Overnight, U.S. stocks staged a shocking counterattack, and MEME stocks started to force shorts. Three years ago, the core target of the short squeeze war, the game station (GME), soared nearly 120% intraday on Monday, and triggered circuit breakers at least six times during the day due to excessive volatility, and finally closed up 74%, S3 Partners data shows that GME bears have lost a total of $1 billion due to Monday's intraday rally.
Other meme stocks also rose collectively due to Keith's return, with AMC Cinemas (AMC), which is also the core target of meme stocks, closing up 78.4%, Koss (KOSS) up 36.7%, and BlackBerry (BB) up 6.9%. Reddit and Robinhood, a popular brokerage for retail investors, also rose at the same time.
The reason is that Keith Gill, the top of the retail investor circle who detonated the meme stock frenzy in 2021 and then disappeared, is back.
On May 13, local time, Keith Gill (screen name Roaring Kitty/DeepFuckingValue or DFV) posted a meme picture on X, which shows a person leaning forward and getting serious while playing a game.
The tweet, which appears to be another battle cry, has been viewed more than 18 million times on X. Subsequently, he released some more movie clips, which all revolve around the return of the character. Previously, the last time he tweeted was in June 2021, and the content was a video of a cat sleeping.
The return of the "king of retail investors" has excited the army of retail investors on Reddit, the stronghold of retail investors in X and US stocks.
On X, there are people quoting Dune memes and chanting Lisan Al Gaib (Savior); The image of the male protagonist Sweet Tea in "Dune II" has also been replaced with the classic image of Keith Gill wearing a red turban.
The army of retail investors on Reddit are scrambling to re-crown the returning Keith with various meme pictures.
Some netizens on Reddit bluntly said that they had saved $100,000 in the past few years and were ready to gamble everything.
Some netizens said that they don't care if they lose money, and they will only follow Keith to move forward.
Who is Keith Gill? Retail investors take the lead in the big brother, the protagonist of the century's short-squeeze war
Just one tweet can detonate U.S. stocks, why does Keith Gill have so much power?
The reason why Keith has such a high status in the hearts of retail investors is because in 2020-2021, he led the "meme stock war" of retail investors against Wall Street institutions.
Keith is the Director of Financial Education at YF Life and has been posting on Twitter since 2014 to share his investment tips. Since 2019, he has been posting about the stock as an undervalued stock, as WallstreetBets, an investment community on Reddit in the United States.
Founded in 1984, Game Station mainly engaged in the rental and sale of physical game cartridges, and had nearly 7,000 stores around the world in its heyday, which is the childhood memory of many European and American gamers.
However, with the advent of the Internet era, more and more gamers choose to buy games on Sony and Microsoft's digital stores, physical cartridges have almost become "antiques", and the business of Game Station has become more and more bleak, with a huge loss of $795 million in 2019, and the stock price has unsurprisingly fallen sharply, from more than $20 to a minimum of only about $3.
The sluggish performance and plummeting stock prices have naturally attracted many bloodthirsty bears, especially Wall Street institutions. These institutions are betting that the company's share price will continue to fall, hoping to make another profit before the company goes out of business.
Throughout 2020, GameStation became the most shorted stock in the U.S., with the stock price below $10 most of the time.
However, Keith is determined to sing more game stations on the Internet, frequently posting screenshots of the real market on Reddit, no matter how the stock price rises and falls, he only buys and does not sell. It happened that during this period, the game station had the support of the American billionaire Ryan Cohen, who also believed that the game station could become the "Amazon of the game industry" through reform, and bought the stock of the game station in large quantities.
After a multi-party counterattack, by the end of 2020, the stock price of Game Station rose again and again, and the funds in Keith's account changed from $50,000 to hundreds of thousands or tens of millions of dollars. More and more retail investors are looking at Keith with admiration and envy.
At this time, the long and short game is also becoming more and more intense, some technical retail investors believe that the short ratio of game station stocks at that time is as high as 140%, if retail investors continue to buy together, pull up the game station stock price, then because the actual number of shares in circulation is less than the number of loans, so the bears must rush to buy back the stock to reduce losses, and promote the game station stock price to continue to rise, that is, the so-called "short squeeze" market.
However, the short-selling institution Citron scoffed at this, and also issued a report to mock those retail investors who followed the trend to buy game stations, saying that they would lose all their money in the end.
It turned out that the arrogant citron did not see the situation clearly.
At that time, affected by the epidemic lockdown, the number of new retail investors in the United States increased significantly, and these people not only held huge financial subsidies from the Biden administration, but also had experienced the education of the rise of the currency circle, accepted the concept of high-volatility investment, and more importantly, many small retail investors hated Wall Street institutions that represented traditional financial forces, and were eager to fight for a game station that symbolized the fond memories of childhood.
And Keith has become the leading big brother of these retail investors. He wears his iconic red bandana every day on YouTube, calling on everyone to buy the stock of the game station.
On January 4, 2021, GameStation closed at $17.25 per share. By the end of the month, it had rushed to a high of more than $500 per share. Throughout 2021, the share price of GameStation has risen by more than 1,000%, which has also driven other meme stocks such as AMC and BlackBerry, and the highest increase in AMC's range has even reached 2,300%. The hedge fund with a scale of tens of billions of dollars was blown up by Xiaosan and could only be forced to close its positions.
This battle of the century between retail investors and institutions was hailed by retail investors as the "battle between David and Goliath", and was also adapted into the movie "Silly Money", in which Keith contributed a lot.
The battle of the century alarmed Congress Keith announced his withdrawal from the grid
Eventually, the meme stock movement that swept the U.S. stock market alarmed the U.S. authorities. In February of that year, Treasury Secretary Janet Yellen convened a meeting of regulators to discuss the implications of the meme stock movement. Keith, as a central figure, was later summoned to testify before the U.S. Congress.
He stressed to Congress that he was an individual investor, did not belong to any institution, did not provide professional financial advice, and that his views were used only for "educational purposes." He just believes that the main business of Game Station is undervalued by the market, and believes that this company can be reformed to adapt to the digital game retail world.
In his testimony, he also explained why he shared his views on social media:
Hedge funds and other Wall Street firms have teams of analysts who can co-compile research reports and comment on investment ideas, while individual investors do not have such an advantage.
In his written testimony, Keith also insisted that the idea that he alone had instigated a surge in meme stocks was "ridiculous":
To think that the idea of me using social media to market GameStop stock to unsuspecting investors is ridiculous, I know very well that my channel is for educational purposes only...... Whether or not other individual investors buy shares has nothing to do with my argument.
In June 2021, Keith tweeted a video of a kitten asleep and disappeared from social media until his sudden return on May 13 this year.
According to media reports, Keith initially bought $53,000 worth of GameStation stock in 2019 and has since increased his position several times, with his holdings worth about $48 million at the peak of the meme stock price surge.
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