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Wall Street protesters. Photo: Tayfun Coskun/Anadolu Agency via Getty Images

Keith Patrick Gill, known on YouTube and Twitter as Roaring Kitty, released his opening statement ahead of testimony before the House Financial Services Committee on Wednesday about his role in the surge of GameStop's stock price.

The big picture: Gill will join the CEOs of Reddit, Robinhood, Citadel and Melvin Capital at Wednesday's hearing. The committee plans to "examine the recent activity around GameStop (GME) stock and other impacted stocks with a focus on short selling, online trading platforms, gamification and their systemic impact on our capital markets and retail investors," per a statement by Rep. Maxine Waters (D-Calif.), chair of the committee.

Context: Gill first took a long position in GameStop a year ago, when he noticed the embattled video game retailer was among the most heavily shorted stocks on the market.

  • He spent months posting about it to the r/WallStreetBets subreddit, a forum of several million amateur investors and spectators who eventually piled into the stock in part to get revenge on hedge funds who were betting that its price would fall.
  • The ensuing phenomenon — in which GameStop's price soared from a low of $2.57 last year to over $480 per share — sparked debate about the role of retail investors, hedge funds, short-sellers, market manipulation and more.

What they're saying: "I’ve been asked why I decided to share my investment ideas on social media. My investment skills had reached a level where I felt sharing them publicly could help others," Gill will testify.

  • "Hedge funds and other Wall Street firms have teams of analysts working together to compile research and critique investment ideas, while individual investors have not had that advantage. Social media platforms like YouTube, Twitter, and WallStreetBets on Reddit are leveling the playing field."
  • "And in a year of quarantines and COVID, engaging with other investors on social media was a safe way to socialize. We had fun."

The bottom line: "The idea that I used social media to promote GameStop stock to unwitting investors is preposterous. I was abundantly clear that my channel was for educational purposes only, and that my aggressive style of investing was unlikely to be suitable for most folks checking out the channel. Whether other individual investors bought the stock was irrelevant to my thesis — my focus was on the fundamentals of the business."

Read Gill's full statement.

Go deeper

Dion Rabouin, author of Markets
Feb 17, 2021 - Economy & Business

Hedge funds will be the villain at GameStop hearing

Illustration: Annelise Capossela/Axios

The House Financial Services Committee will convene a hearing tomorrow on "recent market volatility involving GameStop stock and other stocks" to continue the whodunnit of the current state of financial markets, especially U.S. stocks.

What's happening: Chair Maxine Waters will question the CEOs of Reddit, Robinhood, Citadel Securities, Melvin Capital and Keith Gill, also known as Roaring Kitty or u/DeepF--kingValue.

Dan Primack, author of Pro Rata
Feb 17, 2021 - Economy & Business

What the House's GameStop hearing could mean for private markets

Illustration: Sarah Grillo/Axios

The House Financial Services Committee tomorrow will hold its GameStop hearing, including testimony from the heads of Robinhood, Reddit, Citadel and Melvin Capital. Plus the trader known as "Roaring Kitty," who had better be wearing his headband.

What we know: Conventional wisdom is that the hearing will be lots of sound and fury signifying nothing.

China's political power grows with its capital markets

Illustration: Aïda Amer/Axios

Thanks to a mandate for outside investment and its strong rebound from the coronavirus pandemic, China’s financial markets are drawing record high chunks of global capital — particularly from U.S.-based investors — and are poised to keep growing.

Why it matters: As more money flows to China’s markets, its political leaders will have a clear mechanism to increase the country’s political power, giving China another potent weapon to challenge the United States’ position as the world’s financial superpower.