The stocks in GameStop, the video game seller, have increased to 83% this week, bolstered by boisterous traders on Reddit.
GameStop stock closed at a new record today of $65.01 after closing at $43.03 yesterday. It wasn’t even worth $20 ten days ago, and five months ago, one can get a share for a fiver.
It is a Bitcoin-like growth for the video game retailer. Furthermore, the 51% rise in the last day came in a similar form as a cryptocurrency pump scheme: the vocal Redditors, urging others to buy, buy, buy, and blasting anyone with the temerity to sell during the rally.
The crew helped fuel the price up so quickly that trading of the asset on the New York Stock Exchange was halted at least four times on Friday so that things will cool down.
The r/wallstreetbets subreddit described itself as “like 4chan found a Bloomberg terminal,” having over two million users. And all of the posts in the top 10 as of Friday evening have been devoted to stock in GameStop, which went by the ticker GME.
A popular post features Mel Gibson’s meme as William Wallace from the movie “Braveheart” commanding his motley army to hold. At the top, it says, “F*cking ban anyone who sells GME.” There are three rockets as well, for it is ostensibly going to the moon.
“F*cking ban anyone who sells GME.“
However, there is a villain in this story. It is not the English, but a short-sell investment newsletter named Citron research, which has predicted GameStop would return to $20, likely because of the much sadder r/GameStop subreddit for the recollections of former employees.
“This is a failing mall-based retailer,” said Citron Founder Andrew Left yesterday, before GME rose another 50+%. “So the amount of people who are so passionate about putting GameStop higher, not based on any fundamentals, it just shows the natural state of the market right now—or as [investor] Seth Klarman said it today, a bunch of frogs in a pot of boiling water.'”
To which the Redditors stated, “FUD!” There was no way a company that announced 400 to 450 store closures last September might be a bit overvalued when its stock bombarded above both General Mills and General Motors.
Citron has stopped commenting on GME stock after getting so much hostility from Redditors, indicated Left.
There is something to the price rise; Ryan Cohen, who has co-founded petfood company Chewy, has taken control of three board seats last week. Cohen is predicted to take the company from its spot near the food court into eCommerce.
Perhaps he’ll do the Dogecoin next time.
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