May 14, 2024

Thomas Hogan, former Chief Economist for the U.S. Senate Committee on Banking, Housing, & Urban Affairs, weighs in on the recent rally in meme coins and the surge in GameStop shares.

Video transcript

Roaring kitty is back, right? And so all the Gamestop and like a lot of explosions and, and prices of those meme coins and meme stocks that they have become basically right because I mean, these are essentially meme stocks. If you, if you talk about uh gamestop, like their business model has not changed like that business is gonna fail at some point. Um but they're getting pumped because all, all these people are coming in to take advantage of the short squeeze. And basically, like my take on what happened last time was that it was something cool, but it did not, I don't think create a lot of long term value for uh for investors there. You know, that that company, like their business model is not good. They, they actually did try to revise it a little bit because they had access to low funding after their price went up, they were able to, you know, borrow and get money at a lower rate and so tried to take advantage of some new technology and possibly get into internet gaming. But it, it, you know, it didn't work out. So like their business is gonna fail and that stock price is gonna go down eventually.

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