Lots More With Luke Kawa on Memestock Mania 2.0

SPEAKER_1 (0:03)

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Joe Weisenthal (0:10)

Tracy, do you think the memestock thing is already over already? I'm serious.

Tracy Alloway (0:14)

Well, you know what? I'm looking at the chart of GameStop, and it went up a lot, and now it's coming down a lot. The thing I think is kind of funny is if you view the entire memestock phenomenon from an efficient markets hypothesis, you get really interesting questions like, why didn't the market already price in the risk or the possibility of roaring kitty coming back on Twitter and tweeting a picture of a guy sitting up in a chair? That should have been priced in.

Joe Weisenthal (0:39)

Yeah, I totally agree. As you know, I am the world's biggest believer in the efficient market hypothesis.

It's always priced in all the time. And for the first time in my life at age 43, something has come along to shake my faith.

Tracy Alloway (0:56)

Was it RFK?

Joe Weisenthal (0:57)

No, it is the fact that the market did not price in. Apparently the possibility that after like three years of radio silence, we would get a tweet of a guy leaning forward from the roaring kitty sending the stock.

Tracy Alloway (1:12)

And then RFK Jr. tweeting that he was investing in GameStop.

Joe Weisenthal (1:17)

I have to completely rethink my fundamental assumptions about how all markets work based on the GameStop chart of the last 10 or so days. I'm completely revisiting all my core assumptions.

Tracy Alloway (1:29)

It's good that the apes have you thinking.

Joe Weisenthal (1:34)

I did a deadlift. One, two, three.

Tracy Alloway (1:36)

Hegemony.

Hegemony. Barges.

Joe Weisenthal (1:41)

This is an after-school special, except.

Tracy Alloway (1:43)

I've decided I'm going to base my entire personality going forward on campaigning for a strategic pork reserve in the US.

Joe Weisenthal (1:49)

Where's the best squid ink pasta?

Tracy Alloway (1:51)

These are the important questions. Is it robots taking over the world?

Joe Weisenthal (1:54)

No, I think that in a couple of years, the AI will do a really good job of making the Odd Lots podcast.

And people will say, I don't really need to listen to Joe and Tracy anymore. We do have…

Tracy Alloway (2:06)

Cha-ching. You're listening to Lots More, where we catch up with friends about what's going on right now.

Joe Weisenthal (2:14)

Because even when the Odd Lots is over, there's always Lots More.

Tracy Alloway (2:17)

And we really do have the perfect guest.

Joe Weisenthal (2:22)

Luke, what do you think? Why wasn't it priced in already?

Luke Kawa (2:25)

Yes. My favorite way is to answer a question with a question. And I think the bigger one is, why the heck, if your management of your GME and your senior stock get memed before, how the hell do you not have a shelf ready to go that says, we can sell shares into this any time?

And as for why folks were expecting this, I would say, look at what you have slash haven't gotten from the The Roaring Kitty Twitter account or anything from Keith Gill since, let's call it mid-2021, didn't participate in the book or the movie effectively made about him. It just seemed like, I don't know if The Roaring Kitty just kind of went into pseudo hibernation.

It seemed like nine lives over and was gone from the scene. So not something that was on anyone's radar, certainly of all the crazy things in markets that happened. This was not one when I was coming back into journalism that I was expecting to get hit over the head with.

Tracy Alloway (3:27)

We are speaking with Luke Kawa, our former colleague at Bloomberg. We worked together with him for many years and then he left us to join UBS and do serious financial jobs. And now he's back in journalism. He's a markets editor over at Robinhood's Sherwood Media, so a very triumphant return to financial journalism.

Joe Weisenthal (3:49)

Well-timed, I guess.

It's great. It's like we're going to go to Robinhood's media arm and immediately the GameStop thing happens. It's like fate, right?

Tracy Alloway (3:57)

That's right. And the other reason we wanted to talk to Luke, other than the fact that he's fun to talk to, is he was one of the first people at Bloomberg who took what was happening on Wall Street Bets fairly seriously, and I think was one of the first writers of our big cover story on Wall Street Bets when it actually started to take off. And this was way back in, let's see, early 2020 Is that right, Luke?

Joe Weisenthal (4:23)