What sets the current meme stock hype apart from 2021's?
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Memestocks are witnessing a revival in recent weeks after Keith Gill, a trader who previously ignited the memestock craze, posted on Reddit for the first time in three years. Also known as "Roaring Kitty," Gill shared images of his portfolio containing GameStop shares and call options worth billions, inspiring excitement from his dedicated fans. (CNN has not confirmed the validity of these pictures.)
GameStop shares have increased by roughly 75% and have undergone abrupt, unpredictable swings since Gill's first post. On Friday, thousands of his followers flooded his live stream with inquiries and messages. Prior to Gill's appearance, a video of meowing kittens was played. The trader then arrived on his webcast, drinking a beer and wearing flashy white sunnies.
Similar to the original memestock mania in 2021, the rekindled 2024 memestock market has aroused feelings of déjà vu for former participants. However, there are some notable distinctions between the recent trend and the 2021 episode.
One significant disparity is the decline in trading volumes. The highest trading volume for GameStop shares in 2021 amounted to approximately 789 million, recorded on January 22, 2021, when the stock soared by 51%, according to data from FactSet. The largest transaction volume this year occurred on June 7, totaling 279 million shares; the stock plummeted by 39% that day.
Decreased trading volumes could be attributed to various factors, such as modifications in the economy, Wall Street, and the world in the past three years. In 2021, people were confined to their homes due to the pandemic, investing their stimulus cash in a variety of products such as exercise equipment, raw ingredients for homemade bread, and stocks. The economy was thriving, and interest rates were at an all-time low.
Nowadays, interest rates have reached a 23-year high. With ongoing inflation undermining American savings, the economy remains stable but is showing signs of slowing down as the Federal Reserve attempts to tackle skyrocketing prices without triggering a recession. This reluctance towards assumption of higher risk has moderated traders' willingness to invest as compared to three years ago.
Nevertheless, GameStop, as well as other memestocks, continue to possess financial weakness according to Craig Sarembock, a financial advisor at Bartlett Wealth Management.
Despite the recent surge in GameStop shares, its worth has diminished by 65% from its peak in 2021. The gaming retailer reported a Q1 loss of $32.3 million, which was an improvement from the $50.5 million loss during the preceding year. The retailer's sales plunged by 20% to $900 million compared to the previous year.
Sarembock remarked that memestocks, despite the potential for short-term profits, are a risky investment for long-term investors.
Why oil companies are pocketing massive profits under Joe Biden
Approximately four years ago, while campaigning for the previous presidential election, former President Donald Trump proclaimed that President Joe Biden would "destroy" the oil business.
Biden and Trump will face each other in the upcoming presidential election, with Trump vowing to revoke Biden's environmental policies.
Despite Trump's assertions, the oil and gas industry in the U.S. has been incredibly successful under the current president, despite the Biden administration's endeavor to transition to renewable energy sources.
During his three-and-a-half-year presidency, U.S. oil production and gas company profits have surpassed existing records.
The five most significant US-based oil and gas companies based on market capitalization, as per S&P Global - ExxonMobil, Chevron, ConocoPhillips, EOG Resources, and Schlumberger - have pooled more than $250 billion in earnings between 2021 and 2023. This figure is 160% higher than the first three years of the pro-oil administration of Trump.
The recent financial success of the oil and gas sector illustrates the limited influence of any US president on the international oil and gas market, regardless of stance on fossil fuels.
Check out the complete article.
Elon Musk threatens to outlaw Apple devices at his firms
Elon Musk is displeased with the new Apple and OpenAI partnership, as informed by my colleague Hanna Ziady.
In a tweet on Monday, Musk stated that he would restrict Apple devices at his corporations - SpaceX, X, et cetera - if Apple decided to integrate OpenAI at the operating system level.
If Apple follows through with its plans, Musk contended that this would constitute "an unacceptable security violation."
Furthermore, Musk indicated that visitors would need to relinquish their Apple devices at the door, where they would be kept in a Faraday cage, an enclosure that suppresses electromagnetic waves vital for communication, such as cellular and wireless internet capabilities.
"Apple is clueless about how your data is being used once they pass it on to OpenAI," Musk stated in a separate post. "They're basically selling you out."
Musk's remarks surfaced shortly after Apple announced their collaboration with OpenAI during its yearly Worldwide Developers Conference, an initiative aimed at integrating generative artificial intelligence features into Apple devices.
Find out more here.
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In the context of investing strategies, some individuals might view the recent meme stock market revival as an opportunity for potentially lucrative returns. This business-related activity could be an appealing choice for those who are interested in high-risk, high-reward investments.
Alternatively, financial advisors may caution against investing heavily in memestocks due to their inherent volatility. They might suggest focusing on more stable business ventures as part of a diversified investment portfolio.
