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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsThe 'Roaring Kitty' Rally: How a Reddit User and His Friends Roiled the Markets
A Massachusetts man who goes by Roaring Kitty on social media helped fuel the frenzy around GameStop. His $53,000 investment in the company briefly reached $48 million in value.https://www.nytimes.com/2021/01/29/technology/roaring-kitty-reddit-gamestop-markets.html
In mid-2019, a Reddit user known as Roaring Kitty on some social media accounts posted a picture on an online forum depicting a single $53,000 investment in the video-game retailer GameStop. The post attracted little attention, except from a few people who mocked the bet on the struggling company. This dude should sell now, a Reddit user named cmcewen wrote at the time. But Roaring Kitty was not deterred. Over the next year, he began tweeting frequently about GameStop and making YouTube and TikTok videos about his investment. He also started livestreaming his financial ideas. Other Reddit users with monikers like Ackilles and Bowlerguy92 began following his every move and piling into GameStop.
IF HE IS IN WE ARE IN💎💎💎, one user wrote on a Reddit board called WallStreetBets on Tuesday. Roaring Kitty who is Keith Gill, 34, a former financial educator for an insurance firm in Massachusetts has now become a central figure in this weeks stock market frenzy. Inspired by him and a small crew of individual investors who gathered around him, hordes of young online traders took GameStops stock on a wild ride, pitting themselves against sophisticated hedge funds and upending Wall Streets norms in the process. Their actions pushing up GameStops price by buying so-called options contracts that offer a cheap way to bet on a stocks direction have shocked established investors because Mr. Gill and his online comrades are the antithesis of the Wall Street titans who have long ruled the stock market.
A screenshot of Keith Gill from his Roaring Kittys YouTube channel.Credit...via Youtube
Working far from well-heeled financial offices, Mr. Gill and his fans socialized on Reddit and YouTube and used no-fee online trading platforms like Robinhood and WeBull. Many were so devoted to their GameStop investment that they spent hours each week chatting in the comments section of Mr. Gills videos, delving into the companys financial filings and arcane details about free-cash flow and video game consoles. Their show of force this week underlines how the financial markets have changed by merging with the world of social media and a younger generation of traders who have been empowered by online platforms. It has also made some in this new generation wildly wealthy.
On Tuesday, Mr. Gill posted a picture on Reddit that showed his $53,000 bet on GameStop had soared in value to $48 million. (His holdings could not be independently verified.) The post was upvoted the equivalent of being liked more than 140,000 times by other users. GameStop, which traded at $4 a year ago, closed on Thursday at $193 after reaching more than $480 earlier in the day. Your example has literally changed the lives of thousands of ordinary normal people, a Reddit user named reality_czech wrote this week to Mr. Gill. Seriously thank you. Larry Tabb, the head of market structure research at Bloomberg Intelligence, said the rise of traders like Mr. Gill would have been impossible even a few years ago because every trade came with a fee and there was less focus on the markets on social media. But with people now stuck at home in the pandemic with easy access to free trading at online brokerages, these guys saw an opportunity and they took it, he said.
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The 'Roaring Kitty' Rally: How a Reddit User and His Friends Roiled the Markets (Original Post)
Celerity
Jan 2021
OP
3Hotdogs
(12,376 posts)1. So yesterday, the stock went from $480 to $193.
How many rubes bought in at $480?
Last week, Bitcoin was at $40,000.
Celerity
(43,358 posts)2. Pre-market now, at this moment, 351,06 +157,46 (+81,33 %)
A lot of that drop was because of the illegal blocking by the trading platforms of small investors, but letting the hedge funds (many with interlocks with the very same trading platforms, so total collusion) run wild and try to illegally cheat their way out of tens of billions in losses.
So many lawsuits coming.