If the first “Game Stopped?” U.S. House Committee on Financial Services hearing wasn’t enough political theatre for you then you’re in luck, as Rep. Maxine Waters states there will be two more at some point in the future. Looking at the February hearing schedule reveals they are not planned for this month, however, so we’ll just have to stay put.

The second hearing will include: “Experts on all sides of the issue.” Who could this be? Are they going to bring in experts on short interest? Does “all sides of the issue,” indicate individuals from GameStop? Ryan Cohen? Who knows.

The third hearing is what worries us: “SEC & regulatory response/solutions.” History tells us that the little guy is going to be the one bearing the burden of new regulations, in the guise of, “safer trading for all.”

Source

On Thursday, February 18, 2021, from 12:00 p.m. (ET) full Committee Chairwoman Waters and Ranking Member McHenry will host a virtual hearing entitled, “Game Stopped? Who Wins and Loses When Short Sellers, Social Media, and Retail Investors Collide.” 

Gabe Plotkin of Melvin Capital’s testimony for the “Game Stopped? Who Wins and Loses When Short Sellers, Social Media, and Retail Investors Collide,” taking place Feb. 18 at 12 p.m. ET. has been released. 

Plotkin begins his testimony by stating that has been “humbled” by the unprecedented events, as many investors “on all sides” have experienced losses.

I am humbled by these unprecedented events. Many investors on all sides have experienced losses. I am here today to share my personal experience and to be helpful in this conversation.

Plotkin then goes on to deny the claims that Citadel bailed them out, instead insisting that their cash injection was simply a proactive investment.

Melvin Capital was not “bailed out” in the midst of these events. Citadel proactively reached out to become a new investor, similar to the investments others make in our fund.

The cherry on top here is Gabe admitting that the extent of their fundamentals on shorting GameStop is that selling video games in physical stores is being overtaken. I’m surprised he didn’t just say it’s the next Blockbuster.

In fact, we had been short GameStop since Melvin’s inception six years earlier because we believed and still believe that its business model – selling new and used video games in physical stores – is being overtaken.

If your short position was based upon physical stores being an outdated business model, why would you not close your position upon Ryan Cohen, the man who beat Amazon at e-commerce with Chewy, purchasing 9% of the company? What about when RC Ventures sent a letter to the board urging a digital transition, and hired an attorney specializing in hostile takeovers?  What about when Cohen increased his stake? When the news released that Cohen and his Chewy team had been awarded 3 seats on the board, why not close the position then Gabe?

Greed. That’s why.

Read the full testimony here on house.gov

Keith “Roaring Kitty” Gill’s Testimony before the U.S. House Committee on Financial Services is out. In the statement, Gill touches on his initial investment thesis and how it has adapted to the developments over the years.

The investment I made was risky, but I was confident in my analysis, and I was willing to accept the loss if I was proven wrong. My timing was far from perfect, and many of the options contracts I purchased expired worthless because GameStop’s stock price remained depressed longer than I expected.