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First, it was a bankrupt car-rental agency in the depths of a pandemic that had shut down global travel. Then, it was a brick-and-mortar retailer selling things for computers that are easily available online. Then it was an early smartphone technology well and truly killed by further advances in smartphone technology in which it played no part. And then it was a movie theater chain in the depths of a pandemic that had shuttered movie theaters.

Now, they have been joined by perhaps the most perfect meme stock of them all, one combining all of the contrarian fury of the crowd and much of the rest of the Zeitgeist of the moment: a Medicare insurance startup recently gone public via SPAC (and by a SPAC from the space’s Pied Piper and true believer—and meme stock afficionado, at that—Chamath Palihapitiya) under assault from a short-seller for, you know, lying to people about how many customers it had.

Briefly, we have to add. They were joined by Clover Health briefly.

Clover slipped to $16.92 when the day ended as retail investors on Reddit set their sights on other targets. The stock rose as high as $28.85 per share earlier in the session./Meanwhile, other so-called meme stocks were catching a bid on Wednesday, with Clean Energy Fuels surging.

And it seems the old-tried-and-true Reddit favorites may be the way to go.

[GameStop] named two Inc. veterans as its chief executive and chief financial officer, and shareholders voted Ryan Cohen as chairman… Mr. Cohen said GameStop has a lot of work to do to turn itself around and doesn’t plan on telegraphing its strategy to competitors. “You won’t find us talking a big game,” said Mr. Cohen….

Mr. Cohen said at the meeting that the company was fortunate to have such a special group of investors holding its shares. “You guys inspire us to think bigger, fight harder and work longer each day,” he said, adding that the investors have ushered in a whole new era at GameStop.

And what a new era this computer thinks it will be.

The Qraft AI-Enhanced U.S. Large Cap Momentum ETF, trading as AMOM on the New York Stock Exchange, removed major technology companies from its portfolio this month, as it shifted to favor retailers and other post-pandemic trades…. The standout among the stocks added in June was GameStop…. The AI calling the shots thinks it will move even higher in June, and the shares have already gained more than 6% since the stock was added to the fund for the first time.

Anyway, if you detect a whiff of weariness in this blog around this whole phenomenon, well, all we can say is we’re not alone.

"SEC staff continues to monitor the market in light of the ongoing volatility in certain stocks to determine if there have been any disruptions of the market, manipulative trading, or other misconduct," a spokesperson for SEC said in a statement.

"In addition, we will act to protect retail investors if violations of federal securities laws are found."

You know, like the ones they are looking for at Clover Health.

Clover Health slides 23% as Reddit trade finds new targets [CNBC]
GameStop Remakes C-Suite, Board in Turnaround Push [WSJ]
This robot-run fund thinks GameStop stock will soar in June, and predicts a fall for Tesla and Amazon [MarketWatch]
U.S. SEC says observing the market as "meme stocks" rally [Reuters]

For more of the latest in litigation, regulation, deals and financial services trends, sign up for Finance Docket, a partnership between Breaking Media publications Above the Law and Dealbreaker.


gamestop 3

Goofballs Still Burning Melvin Capital, Et. Al.

GameStop may not be selling weed or ice cream or dog food, but it and its ilk are certainly selling a lot of stock.

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GameStop Chairman Offers Masterclass On Legal Pump-And-Dump

His Bed Bath & Beyond trading may “stink to high heaven,” but if he left no paper trail he’s probably in the clear.


It’s Technical

GameStop’s gravity-defying rise, that is.