A fork of Rural Dictionary
Used to describe a very painful, (and sometimes embarrassing), situation that one cannot get out of immediately. This could imply financial, social (where one gets mocked and doesn't have a come back) , physical (getting one's foot caught under a boulder); this could be used in all aspects of life.
Example one: "Hey, did you want to come along on that three week expedition with us?" "No, sorry dude, I'm tapped out. Fiscally, I'm hanging by a wedgie". Example two: "Dude, I just got pwned by Mike. There's no way I could top that comeback. He's got me hanging by a wedgie.