AMC Aand GME Stock Reappear as Major Players in the Meme Rally
Following his first appearance on social media in three years, Keith Gill—who ignited the meme stock rally during the pandemic—saw a sharp increase in GameStop (GME) and AMC shares on Monday. The New York Stock Exchange briefly stopped trading GME stock many times early on Monday due to the spike in shares.
For the first time since June 2021, Gill, also known online as “Roaring Kitty,” shared a social media message on Sunday night.
Keith Gill’s Impact
In 2020 and 2021, Gill gained notoriety as a primary instigator of the GameStop (GME) short squeeze. In February 2021, the House Financial Services Committee summoned the former financial broker and analyst to appear regarding possible investigations into market manipulation.
The Response of Ordinary Investors
With remarks like “He’s back,” “Game on,” and “It’s time for the memecoin supercycle,” which alluded to the surging values of lesser cryptocurrencies, retail investors cheered Gill’s comeback. On Monday, GME stock surged by about 74.5% after he posted. The NYSE repeatedly stopped trading on GME stock during the first hour of trade on Monday due to the volatility.
GameStop’s stock had been largely steady this year as of Friday, when it closed at 17.46.
AMC Entertainment’s Growth
AMC Entertainment (AMC), a chain of theaters, also experienced a notable boost on Monday, surging by 78.4%. Even with this increase, AMC’s stock had, as of Friday, lost around 53% of its value in 2024. The shares are still far higher than their record low of 2.38 from April.
Prior Short Squeeze
The shares of GME stock increased by 688% in 2021. Through internet message boards, individual investors orchestrated a purchasing frenzy of the video-game retailer’s shares. Short sellers were taken aback by this buying frenzy because they had bet that the stock would decline. If these “shorts” didn’t repurchase the shares, the price would continue to rise. Otherwise, their losses would be limitless.
This was a novel and contentious strategy for increasing GME stock.
The Ascent and Decline
Strangely, the reason GME stock rose was because it had dropped so much and a large number of investors thought it would continue to decline.
A third of the value of GME shares had been lost over the preceding five years by 2021. By the end of 2019, shares of GME were under the hands of short sellers, who were betting on the price to decline. This extreme bearish wagering set up the stage for a huge short-squeeze bounce.
Pop Culture Allusion
The movie “Dumb Money” covered the whole story of the short squeeze scandal.
