Connect with us

Business

Melvin Capital’s Gabe Plotkin was target of anti-Semitism

Published

on

Melvin Capital's Gabe Plotkin was target of anti-Semitism

The head of the hedge fund at the center of last month’s GameStop frenzy says Redditors targeted him with anti-Semitic insults and text messages.

Melvin Capital founder Gabe Plotkin made the disturbing claim in prepared testimony he plans to deliver at Thursday’s House Financial Services Committee hearing on the recent populist revolution in the stock market.

Melvin became a prime target of rookie traders on Reddit’s WallStreetBets forum because it had taken a short position in GameStop, meaning it was betting that the struggling video-game retailer’s stock price would fall.

While Reddit users encouraged each other to “trade in the opposite direction” of Melvin’s investments, they also took aim at Plotkin personally, he said.

“Many of these posts were laced with antisemitic slurs directed at me and others,” Plotkin said in his testimony. “The posts said things like ‘it’s very clear we need a second holocaust, the jews can’t keep getting away with this.’ Others sent similarly profane and racist text messages to me.”

WallStreetBets has a reputation for being foul-mouthed and crass. Its users frequently refer to each other as “retards” — an offensive slur for people with intellectual disabilities — and Keith Gill, the Redditor credited with spearheading the GameStop rally, goes by “DeepF—ingValue” on the forum.

But Reddit CEO Steve Huffman defended WallStreetBets in his prepared testimony, saying the 9.1 million-member message board is an online community with “significant depth.”

“WallStreetBets may look sophomoric or chaotic from the outside, but the fact that we are here today means they’ve managed to raise important issues about fairness and opportunity in our financial system,” Huffman said.

Plotkin’s testimony also detailed how the unprecedented surge in GameStop’s stock price affected him professionally as well as personally.

Melvin Capital — which Plotkin named after his grandfather — closed its short position in GameStop at a loss in the last week of January as the company’s stock price soared to a peak of $483 a share.

Melvin had held that position since it was founded six years ago because the fund believed GameStop’s business model of selling video games in brick-and-mortar stores was “being overtaken by digital downloads through the internet,” Plotkin said.

Melvin abandoned the bet “not because our investment thesis had changed but because something unprecedented was happening,” Plotkin said. “We also reduced many other Melvin positions at significant losses — both long and short — that were the subject of similar posts.”

Despite the turmoil, Plotkin insisted that the $2.75 billion investment Melvin got from Ken Griffin’s Citadel and Steve Cohen’s Point72 in late January was not meant to bail out the fund as it grappled with heavy losses.

“To be sure, Melvin was managing through a difficult time, but we always had margin excess and we were not seeking a cash infusion,” he said.

Continue Reading
Advertisement
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Business

Michaels to be acquired by Apollo for $3.3 billion

Published

on

By

Michaels to be acquired by Apollo for $3.3 billion

Arts-and-crafts retailer Michaels said it has agreed to be acquired by private equity giant Apollo Global Management in a deal that values the company at $3.3 billion.

The going-private transaction values Michaels’ outstanding stock at $22 a share, a 47 percent premium to the closing price on Feb. 26, the last trading day before the media reported that Michaels was in play, the companies said.

The deal with Apollo — controlled by billionaire Leon Black, who has been weathering a scandal over his ties to dead pedophile Jeffrey Epstein — is valued at a total of $5 billion including debt.

Michaels shares on Wednesday rose $4.08, or 23 percent, to $22.10 in early trading.

The arts-and-crafts retailer has more than 1,200 stores in North America and it had been a go-to stop for consumers looking for something to do during quarantine.

In the fourth quarter, its comparable sales increased by 16.3 percent compared to a year ago.

“Our Michaels strategy and the work that we have done in the past year have led to phenomenal business results, strengthened our core business and positioned Michaels for long-term sustainable growth,” Michaels chief executive Ashley Buchanan said in a statement.

“As a private company, we will have financial flexibility to invest in, expand, and improve our retail and digital platforms.”

Continue Reading

Business

Olbermann slammed for saying Texas shouldn’t get COVID vaccine

Published

on

By

Olbermann slammed for saying Texas shouldn't get COVID vaccine

Left-wing political pundit Keith Olbermann is drawing heat again, this time after he said that Texas shouldn’t get the COVID-19 vaccine.

In response to a tweet from Texas Gov. Greg Abbott who announced the end of the state’s mask mandate, Olbermann tweeted: “Why are we wasting vaccinations on Texas if Texas has decided to join the side of the virus?”

The tweet sparked a pile on across the Twittersphere with people from both sides of the aisle chastising the former ESPN and MSNBC talking head.

“Ah yes millions should be left to suffer and die because their Governor (who they are already trying to oust) is a festering pile of feces…or…or hear me out…we could support the communities he plans to sacrifice,” tweeted writer Mikki Kendall.

“I just think it’s wrong to make gross generalizations about the lives and potential deaths of an entire population. It is mean-spirited and unhelpful on every front,” wrote a Dallas Morning News reporter, Evan Grant.

Brandon Friedman, a former Obama administration official kept it short, writing: “Delete this, Keith,” while Daily Beast editor-at-large Molly Jong-Fast tweeted: “People deserve to stay safe and healthy no matter who they voted for.”

This isn’t the first — and likely won’t be the last — time the bombastic Olbermann has been in hot water after voicing his opinions.

Last November, he was slammed on Twitter for calling President Trump “a whiny little Kunta Kinte,” in a ham-fisted attempt to twist the name of the “Roots” character into a crude insult.

Continue Reading

Business

Magic Johnson joins board of Fanatics

Published

on

By

Magic Johnson joins board of Fanatics

Basketball legend Earvin “Magic” Johnson joined the board of Fanatics, the sports licensing company said Wednesday.

The former Los Angeles Laker — who led his team five times to the NBA championship — has agreed to join the board as one of three independent directors, including Mindy Grossman, chief executive of WW (formerly Weight Watchers) and Gerald Storch, a former CEO of Toys R Us and Hudson’s Bay Company, which owns Saks Fifth Avenue.

The high-profile appointment comes as the privately held Fanatics, which makes jerseys and other gear for professional sports leagues and teams as well as universities, has been reportedly working toward plans to file for an initial public offering.

While an IPO is clearly an available path to us, there is no update on any timeline,” the company said in a statement. “Our focus remains on building a great global company and strengthening our vertical commerce business model.”

Led by founder Michael Rubin, Fanatics has been on a fundraising tear, securing $350 million in August, which values the company at $6.2 billion. The National Football League and Major League Baseball are also investors in the company, which sells licensed apparel mostly online.

In a statement, Rubin said of Johnson, “He’s an NBA legend and a titan in the business world, but more importantly he recognizes and leverages his platform to advance diversity and inclusion across all business sectors.”

The hoopster heads up Magic Johnson Enterprises, an investment company that focuses on ethnically diverse and underserved urban communities. In 2012, he became co-owner of the Los Angeles Dodgers and holds ownership stakes in the WNBA’s Los Angeles Sparks, Major League Soccer’s Los Angeles Football Club, and eSports franchise Team Liquid. His company also owned more than 100 Starbucks stores until 2010.

“It’s an honor to be invited to join the Fanatics board of directors,” Johnson said in a statement. “I’ve been impressed with the evolution of the company and its ability to transform the industry over the past several years.”

Continue Reading

Trending