[casino play for real money]Jim Cramer: The Pushers of Meme Stocks Are Actually Sticking It to Themselves

  Do the people who create and push meme stocks know that they think they may be sticking it to the man but they are actually sticking it to themselves?

  This morning I saw a post on WallStreetBets babbling about Corsair Gaming (CRSR) , a high-end mostly gaming equipment company, and I said to myself, here we go again. Corsair’s stock will jump eight or nine points, and then the hedge funds will come in and short the stock and make a killing at the meme-ists expense.

  Who can blame the shorts? As much as I like Corsair, as much as I have championed it, with the exception of GameStop (GME) and AMC (AMC) , stocks don’t go up for no reason. They usually have a catalyst, something that creates a substantive reason to buy, not just the hope that it will be the next GameStop or AMC. I think that whole rap is wearing thin and that’s what anyone who bought Corsair at $42, the high of the day, is certainly thinking.

  Now I could hear someone say, “Cramer you love Logitech (LOGI) and that’s up huge, why can’t Corsair which has amazing equipment go up just as much or more.” Corsair’s stock is up 4% and Logitech’s zoomed 33%. I see the logic, ha, in that analysis but the two aren’t exactly comparable and the breadth of Logitech’s portfolio is much bigger than that of Corsair. The latter did beat estimates by 25 cents, 58 cents versus 33%, but the fact is the stock dropped 10% when those numbers were reported. That’s because Corsair is considered a pandemic play and now people want to go out, not stay in and play video games. It’s the same thinking that’s plagued the whole group after some really amazing earnings reports. Activision Blizzard (ATVI) and Take-Two (TTWO) both reported incredible beats yet ATVI is only up 6% and, incredibly, Take-Two’s stock is down almost 10%.

  That means the staying power of Corsair, up 22% on the post on phenomenal 36 million shares traded, out of a float of 31 million, implying endless in and out trading, has to be called into question even if you are, like me a big believer in Corsair.

  In fact Corsair might be very similar to Wendy’s (WEN) , another stock I like so much that was taken up by the WallStreetBets crew up to almost $30, where I am sure many hedge fund shorts came in and sold the stock because the analysis and buy recommendation was the definition of pablum. The bottom line idea of the post? Buy Wendy’s because the salad is great. I can’t even describe it as fatuous because that would be too kind a description.

  Of course that stock then plummeted to $24, crushing anyone who bought it around $30 and making the hated hedge funds fortunes.

  Do I know that it is hedge funds that are doing it? Do I talk to them because I am a Baby Boomer who wears a suit? Dream on. I am sure the sycophants will claim that they do but I could wear a wire for weeks and you’d never get a hedge fund manager to speak on a cell or in person to me.

  Ultimately it doesn’t matter if it is a hedge fund that wins or a reader who loses, the point here is that meme anointing is not a way to make money except for the initial buyers, who may be pumping and then dumping, and the short sellers who come in when the stock is impossibly high for the day.

  I do applaud the WallStreetBets people for moving on from just AMC and GameStop every single day. But let’s remember that if there is no reason to buy a stock other than a post or a meme, the staying power is questionable at best and it’s more important, if you weren’t the one pumping, to dump it and move on.

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