The “meme stock” revolution found its face in early 2021, thanks to the efforts of former financial analyst Gill, also known as u/DeepFuckingValue on Reddit and Roaring Kitty on YouTube and X. Gill was able to force hedge funds which had bet against companies like GameStop and AMC Theatres to cut losses by driving up the prices of these stocks. Currently, Gill is back on social media, sparking another surge in GameStop shares, following a nearly three-year hiatus. Nonetheless, his strategy remains unclear this time.
Gill broke his quiet on Sunday on X with a straightforward meme that showed a gamer “locking in.” Speculative retail buyers on Reddit’s r/wallstreetbets forum went into buying frenzy after seeing this cryptic post. GameStop ($GME) reached a level not seen since June 2021 on Tuesday morning, rising to $64.83. With a series of movie clips that featured scenes from epic fights and Marvel’s Thanos proclaiming, “Fine, I’ll do it myself,” Gill kept up the enthusiasm and drove the stock up by more than 370%.
Short sellers were severely impacted by this resurgence of interest in GameStop, and on Monday, they are reported to have lost $1 billion. While other meme stocks, like as Blackberry and Nokia, had very slight rises, AMC saw a Tuesday opening of $11.82, up from the $2.95 on Friday. GameStop and AMC saw numerous trade halts as a result of the volatility; on Monday, GameStop experienced nine halts, while on Tuesday, AMC experienced 21 halts.
This time, unlike the 2021 spike, Gill hasn’t offered any in-depth analysis or insight into why GameStop is a wise purchase. In the past, he invested more than $50,000 in 2019 and progressively increased his shares, providing strong evidence that the stock was undervalued. These days, his messages are laced with allusions to popular culture, forcing investors to decipher sequences from programs like Mr. Robot in which the word “Stay” appears on a computer screen and suggests holding onto $GME shares.
Gill’s cautious attitude might have resulted from the scrutiny he endured in 2021, which included being called before Congress and MassMutual, his former employer, being fined $4 million for neglecting to keep an eye on his trading activity. An additional complaint alleging market manipulation was eventually dropped against him. When former SEC Chair Jay Clayton discussed his worries about the meme stock phenomena on CNBC, likening it to gambling and raising doubts about its role in the markets, there was a renewed focus on his activities.
It’s still unclear whether regular investors will be able to duplicate the 2021 magic, despite all the hype. Many may now be eager to sell and collect profits or reduce losses on their shares of GameStop and AMC, which they held onto while prices sank following the first surge. A joke on r/wallstreetbets picturing the user as a “previous bagholder” who gains from new customers encapsulated this feeling. In these areas, some doubters are already forecasting a brief bubble.
Concerns over Gill’s intentions and potential benefits from recent price swings are further raised by his lack of candor regarding his present ownership in GameStop. Some investors are hesitant to rely on his influence because of this uncertainty. The new spike seems to be motivated by a want for the another David vs. Goliath triumph, akin to the narrative depicted in the Paul Dano film Dumb Money, which stars Dano as Gill.
However, like to numerous sequels, this one might fall short of the original. Meme stock traders have to accept the hazards associated with their high-stakes game, even as they condemn trading halts and blame celebrities like Clayton of supporting hedge funds. One investor lands on the moon for every one that returns to Earth in ruins.
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