The frenzy around GameStop and other meme stocks from earlier this year may have quieted down a bit, but the SEC is still diligently on the case, trying to get to the bottom of what happened. That apparently includes subpoenaing big time investor Michael Burry, famous for betting against the 2000s housing bubble, and an early champion of GameStop’s unlikely revival.
“So, who got an SEC subpoena over $GME?” Burry wrote on September 24 in a now-deleted tweet that included a copy of a letter from the regulatory agency. “Actually, I know who, they’re on my subpoena. With all that’s going on in the world…”
The head of the Scion Asset Management firm stunned Wall Street and gamers alike back in 2019 when he revealed that he was bullish on GameStop’s fortunes, holding a 3 million share stake in the struggling brick-and-mortar chain. Those shares were trading for just over $US5 ($7) when Burry, whose windfall from predicting the 2008 financial crisis was dramatized by Christian Bale in the Oscar-winning film The Big Short, told Barron’s that the soon-to-be-revealed PS5 and Xbox Series X/S would buoy the company’s fortunes.
Still, GameStop’s stock stayed in the dumpster throughout 2019 and most of 2020. Things did improve around the time of the new console releases, but by then other financial forces had begun to hijack the GameStop stock price, including a burgeoning scene of investor shitposters on the WallStreetBets subreddit. By earlier this year, all hell had broken loose, the stock price spiked at over $US300 ($412) a share, and Burry was calling the whole thing “unnatural, insane, and dangerous,” and calling for the SEC to step in and investigate.
Well, he certainly got his wish. SEC Chair Gary Gensler recently announced that the agency is very close to publishing its post-mortem on the “gamifying” of the stock market, though apparently not before it talks to a few more key players like Burry.
In the meantime, the fallout from the GameStop meme stock fiasco continues. The SEC announced today that it has charged two traders involved in the frenzy with committing “fraudulent schemes” around stock exchange rebates. Earlier this month, Massachusetts fined MassMutual, the former employer of GameStop meme lord Keith “DeepFuckingValue” Gill, $US4 ($5) million for failing to supervise his trading activity outside of work.
Despite all of this, and the fact that you still can’t buy a PS5 or Xbox Series X/S in its stores, GameStop stock is still trading for an unfathomable share.
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