Meme Stock Fever Is Spreading Like It’s 2021 With Kohl's Soaring

0:00Some people treat ChatGPT like some kind of smart search engine, and some use it to get work done. ChatGPT Work is a new way of working in ChatGPT that can take action across your apps and files, stay with a project for hours if needed, and turn a goal into finished work. It's designed to help you move from a chaotic starting point to a reviewable first version. So all the source materials, briefs, and scattered information that you have to grind through to turn into something useful can just become something useful. Put ChatGPT to work on your most ambitious ideas and projects. Get started at ChatGPT.com by selecting Work Mode, available on Plus and Pro plans.

0:42Healthcare doesn't always work great. If you've ever waited on a refill or couldn't schedule an appointment, you get it. That's the kind of stuff Optum is changing. They're using data and technology to integrate patient care, pharmacy, and everything else. So healthcare is connected, not complicated. What's that look like? Cheaper prescriptions that are easier to get and care that looks at the whole person, how you need it. Optum is helping make healthcare work as one for everyone. Learn more at business.optum.com. As industries evolve faster than ever, companies need an environment that accelerates strategic growth.

1:17And Michigan delivers on that promise. From emerging startups to global enterprises, Michigan offers what executives value most, a resilient, innovative ecosystem, diverse communities that attract top talent, and a quality of life that supports work-life balance. With our unified Team Michigan approach, businesses scale faster and compete at the highest level. Michigan, pure opportunity. Seize your opportunity at michiganbusiness.org. Bloomberg Audio Studios. Podcasts. Radio. News. This is Bloomberg Business Week Daily. Reporting from the magazine that helps global leaders stay ahead. With insight on the people, companies, and trends shaping today's complex economy.

2:03Plus, global business, finance, and tech news as it happens. The Bloomberg Business Week Daily Podcast. with Carol Masser and Tim Stenebeck on Bloomberg Radio. Well, it does kind of feel like 2021, at least some vibes. With meme stocks and crypto back in the spotlight, coal shares more than doubled amid an influx of mentions by retail traders on social media, with the stock price soaring as much as 105 % when the equity market opened today. And then there's open-door technologies. It jumped as much as 120 % yesterday. It extended its gravity-defying rally from last week. Investors continue to pile into the stock that has found a sudden fandom among retail traders and social media platforms.

2:45I mean, this is one that is certainly on our radar. One of the reasons Open Door has been moving is due to Eric Jackson. He's the founder of Toronto-based hedge fund EMJ Capital. He made a series of posts on X encouraging buying. And Eric joins us from Toronto on this Tuesday. Eric, good to have you here with us. Do you, first of all, take issue with this being Open Door, a meme stock? Yeah, I think, Carol, that all the meme stocks from 2021 were dumb businesses. I couldn't understand it at the time why retail traders were getting so wrapped up in AMC, GME, and BlackBerry. I think those were the big three.

3:26Those are all like walking dead businesses. So when I got into Opendoor and then I first started tweeting about it last Monday, it's hard to believe. it feels like a century ago, like 245. Like I got into it because this is a real business and it's got a real platform that it's built and it's definitely fallen on hard times. That's why the stock's down like 99 % or whatever it is from its all time highs. But I just think that the market got overly pessimistic about it. And I've seen this movie before with Carvana. Like that's one of my like, you know, greatest heads on my wall, I guess. you know, from the past is that I got into Carvana early, not at$3.50, but at$15.

4:14And today it's like close to$400. And I just see so many similarities between these two businesses. And, you know, people just get overly prisoner of the moment, pessimistic about these companies, and everyone's negative Nelly, and everyone loves to dance on the grave and say that these companies are circling the drain, nobody would have believed at$3.50 that Carvana was going back to$400. Nobody can believe now that it was$0.70 last Monday. Now it's whatever it is,$3. Today, this thing is, I think, going to$82. Yeah. Okay, so let's talk about that. It's$2.80 right now, down about 12%, 13 % as we speak, just on the day today.

4:54You have a price target of$82. That's pretty wild. Make your case to us on why you see it moving that high. Well, I mean, I'll be even wilder, Tim. I think today it should be trading at 40 bucks. You know, it's it's, you know, like basically that if you look at go back and look at Carvana, OK, use this as a comparison to Opendoor. Both of these companies, they're trying to e-commerceify some niche that hasn't been e-commerceified before. For Carvana, it was buying and selling used cars. For Opendoor, it's buying and selling homes. It's a huge business, obviously, in both cases, a national business, where just having like one or two or 3 % market share nationally, you know, is talking billions and billions of dollars and power, because it's all so fragmented today, you know, with the dealers in the car industry and with the agents, you know, in the real estate industry.

5:53And basically, you need a lot of debt to run both of these businesses. And so the problem that both of these businesses came upon is that although they were flying high in the pre-COVID and then briefly post-COVID era, when interest rates were low, when Powell started raising rates, suddenly investors got nervous and these stocks crashed. And the assumption was that they're going to go under. They're going to file for bankruptcy. So they're priced as if they're going to go bankrupt. And I don't believe that's true. Carvana, you know, in fact, I was on a podcast in June of 2022 with Josh Brown and Michael Batten, where I called both, like I said, both would turn around.

6:34Carvana did and Open Door didn't. I was dead wrong. Like it took a lot longer for them to get to the point where they're about to turn profitable, but they are about to turn profitable. So for Open Door, do you expect to inject and invest more money into it and then take a profit or because it sounds like you've done the research, looked at the business, maybe talked to the company, that this is more of a long-term buy and hold strategy for you? Which is it? Well, I've been fortunate to be early on a bunch of companies. I was really early on Alibaba even back in 2009, 10, when it was still a private company.

7:17It was valued at 10 billion. and I thought it was going to go up. Carvana, you know, some other ones. Like what I've learned, Carol, is that, you know, like it's always hard to not avoid the temptation of firing up the terminal or turning on business TV and getting emotional about the macro headlines of the day and get shaken out of these positions. And sometimes when you, you know, these companies are pretty rare, you know, that can truly 100 bag or 100 X, right? But like, you know, it's so easy to get shaken out of these positions or like in the case of Carvana. Like I got like I said, I got into it at 15.

7:55I would say I got out of it, you know, the bulk of my position and around like probably 130, 140, 150, somewhere in there. And I'm thinking, oh, I'm so smart. I made 10x my money. Pat myself on the back here, you know, and I know this company really well. I still was optimistic about Carvana. I still am today. But I thought like, I'm just going to trade it, trade in and out. And, you know, the truth is you don't make as much money as if you do nothing and just let it sit there. So I'm not like jumping into to add more, Carol, but, you know, because I want to see how the things play out. But, you know, I'm going to try to avoid that temptation and just sit and do nothing.

8:31How much can you give us an idea how much you have put into it? And is it all your money? Is it investor money? Well, I run a fund, Carol. It's a it's a it's a small fund. I'll be frank with you guys. It's like I had a huge I had a huge billionaire that basically was like a cornerstone investor for me in 2016, 17 when I started EMJ Capital. And he said, I like the way you think, Eric. You know, you look at companies differently. You find these like little hidden jewel companies. How about I give you some money to manage? And I did and did great. Like it was kind of like a Cathie Wood type arc, like 2017 up to, you know, probably February 2021 was amazing.

9:10Shot the lights out. And then 21 and 22, I got crushed. And I didn't diversify my, what do you call it, customer base. And so like 99.5 % of the capital in the fund was this billionaire. And he took it out, which was his right. And I'm still friendly with him. But I was sort of like left scrambling and trying to figure out what to do. And so kept the lights on, pivoted to building a team to build AI models, you know, but, you know, it's been hit and miss the last few years. And then it was only like probably, you know, three months ago that I realized like, hey, you know, we're doing, I keep finding these companies.

9:51Why don't we just sort of go all in on that? Let's get the AI models totally focused on finding these hundred baggers before the fact. So the remaining capital we have, which is a few million, we put in, you know, obviously, we didn't put it all into Opendoor or anything. We have other positions. There's sort of like five key positions I have right now. Iron, cipher mining, BTQ technologies, and Ethereum. Those are the kind of the big five I'm focused on. And, you know, we'll see where we go. And, you know, all I got is my reputation, guys. All right. No, no, no, we get. Now I've got, I've got, I've got, you know, I've got people, you know, whatever, calling up or emailing and saying, you know, this is great.

10:29You know, we want to get behind you. So we'll see where it goes. Seems like a lot of folks on social media, a lot of folks on social media are getting behind you. Have you talked to Chamath Paliha Patia at all about this? He is, you know, had famous involvement with Open Door back when it went public. I haven't talked with him. I, I, not emailed, but I texted, or not texted. I tweeted him. I tweeted him when this thing got started last week, because obviously I think it would be a tremendous redemption arc for Chamath to come back into this stock. I don't think he has anything to be ashamed of, of being involved with Open Door to begin with, or any other co-founder.

11:09Like Keith Ravoy is a guy who wrote the business plan originally. I think he's one of the smartest guys out there. Everybody who was associated with this company was, you know, it was a good company. You know, it's just, you know, the macro changed and the rates rose and stuff. And so I don't think Chamath is anything to be, you know, ashamed of. But I think it would be amazing if he came back in on the ride to 82, which would double the all-time highs, which is previously$39. Eric, forgive me for being blunt about this question, but if you look at your Twitter feed, there's just a, it's like all open door.

11:40I mean, I had trouble, you're spending a lot of time retweeting and interacting with folks on there. And I understand that's part of the game these days, but maybe a critic could see that and say, you're really trying to just pump this stock up at this point. Defend it on its fundamentals and convince people that this is not, you know, for lack of a better term, pumping it up and then selling. I don't know what to tell you. I mean, unfollow me, Tim, if I'm bugging you. Mute me or block me. And I'd say that to anybody else. I think anybody who knows me knows I'm not a pumper or whatever. I mean, I have been, obviously, I've been inundated, called a pump and dumper, a grifter.

12:21Jim Cramer said this was a parlay yesterday. I don't know what that means. You can explain it to me. Yeah, whatever. I mean, people are, you know, they're not familiar with the open door story. So whatever. They want to sit back behind their anonymous Twitter feeds and cast aspersions. I don't care. I'm here to make money. I don't have it. I got to feed my family. I got to grow this business. I got to do well for my investors. And if people want to take shots, whatever, you know, you know, I just don't have time for it. I really love the community that we've built. I mean, it's it's amazing. This morning I was retweeting all these people from, you know, you name it, Turkey, Korea, Japan, Africa, Nigeria, Brazil.

13:06I mean, everyone around the world and they're all in on Opendoor. Yeah. You know, I don't know that it's going at 82. I don't know. I don't know. Crystal ball. I wasn't, you know, I don't know. I might be wrong. I was wrong for many, many years about Opendoor, but I don't think I'm wrong right now. I think now is the time this thing is turning and you can either get in, make a lot of money or not. And I got people already telling me how much money they've made and it's life-changing and all this. That's fantastic. I mean, it doesn't, doesn't help me, but I'm happy for them. This is a community.

13:36Eric, you did, you did say, no, I, I hear you. You said you're hoping to hold onto it. Like, that's your plan. But I mean, if all of a sudden the stock took a downturn, I mean, it's a$2.84 stock. So I'm not quite sure what kind of downturn, but is there something that you would quickly change your thoughts or you're going to ride it, even if it rides down a lot? I can't say I'm going to ride it forever, Carol. I mean, not forever, but I mean, if it went down 50 percent, would you stay with it? I think it's less about the percentage drop. I mean, there's obviously going to be volatility, especially in the early days of these kinds of names.

14:17And, you know, they report earnings in a couple of weeks. So, you know, if it's a terrible report, I mean, the thing would, you know, would have a negative reaction to the downside and then reverse to the upside if it was good news. I think it is going to be profitable, and I think it's going to be the start of a string of profitable quarters, which is what needs to happen for this thing to get up to 82. But, you know, one thing that's different about OpenDoor is, like, there is more diverse opinion about management. I think with Carvana, like, obviously, everybody on Twitter and Wall Street hated it.

14:48But if you talk to people that actually knew the business, I think people really admired the CEO, Ernie Garcia, and the management team. And those guys bought a lot of stock when Carvana was low, right before it bottomed. Nobody's done that here at Opendoor, which is the norm for most of these. I mean, most times these insiders, you know, they just don't. Brian Armstrong from Coinbase never bought a share from the time he went public at$400 down to$38 back up again. He just sells, sells, buy a house in LA. But there's more controversy about the management here at Opendoor, Tim. Not to cut you off.

15:21Yeah, that's OK. Some people think Carrie Wheeler, who's the CEO, is great, and some people don't. And so if I discovered three months from now that, gosh, I don't know about her. I mean, one thing I might think about is, what's the chance of an activist coming in here, which I think is very high? So that might keep me in. But if I concluded the management's terrible, I can't stand it anymore, then obviously I'd have to exit. I don't think that's going to be the case. Eric, before we let you go, other stocks that you are buying right now, that you're holding right now, what are people missing and what are you getting?

15:58Earlier today, Tim, hot off the presses, I tweeted this out already. I bought some IREN and CIFR. Both of those are Bitcoin miners. Make a lot of money from that, but they're more excitingly, they're kind of like a core scientific. And just, you know, CoreWeave bought Core Scientific recently, but it was kind of a lousy price for Core Scientific. Iron and Cypher are way bigger, have way more kind of energized gigawatts that are coming online in the next year that somebody like an Oracle or a Meta or, you know, Google has to do a deal with. So I like those and I like BTQ Technologies. BTQQF is the ticker.

16:38It's still an OTC ticker. I bought it at 21 cents in December. It's now at like five bucks. So it's been a 30 bagger for me so far, but I think it's going to meet the criteria and be a 100 bagger when all is said and done. All right. He's looking for the diamonds in the rough, no matter how low the prices are. Hey, Eric, appreciate you taking so much time with us this afternoon. It's great to check back in with you. It's been quite a few months, so we love it that you took the time. Eric Jackson is the founder of the Toronto-based hedge fund EMJ Capital. I would never block him on Twitter. I still follow you on Twitter.

17:12check out his Twitter feed too, because he does share a lot of what he's working on as well. Yeah. Pretty clear. I'm pretty transparent and stuff out there. Some people treat ChatGPT like some kind of smart search engine, and some use it to get work done. ChatGPT work is a new way of working in ChatGPT that can take action across your apps and files, stay with a project for hours if needed, and turn a goal into finished work. It's designed to help you move from a chaotic starting point to a reviewable first version. So all the source materials, briefs, and scattered information that you have to grind through to turn into something useful can just become something useful.

17:50Put ChatGPT to work on your most ambitious ideas and projects. Get started at ChatGPT.com by selecting Work Mode, available on Plus and Pro plans. Let's talk about healthcare for a second. It doesn't always work the way people expect it to. If you've ever waited on a prescription refill or had a hard time getting the care you needed, you know the feeling. The system should just work better for everyone. That's exactly what the people at Optum are trying to do every day. They're a healthcare company linking patient care and pharmacy services and using data and technology to drive the whole system so care is connected, not complicated, for patients and providers.

18:29Things like making it easier to get care that looks at the whole person, from primary care doctors to mental health support and even in-home care, and then using technology to make sure they all work together. Technology designed to help doctors spend less time on busy work and more time with their patients. And those prescriptions? Optum is working to bring costs down, save patients money, and make it easier to get refills. Little by little, Optum is helping make healthcare work as one for everyone. Head to business.optum.com to see how. Wise is the smart way to manage the currencies you need around the globe.

19:05If you've ever sent money internationally using a traditional bank, there's a good chance you've paid more than you realized. Hidden fees, exchange rate markups, and extra charges can quietly add up before your money even arrives. There's a better way. Try Wise. Wise uses the exchange rate you'd usually find on Google, helping you avoid the unwelcome surprises that often come with international transfers. Whether you're sending money to family overseas, spending while on your holiday abroad, or paying bills across borders, Wise makes moving money simple, transparent, and straightforward. Wise offers 24-7 customer service and runs over 7 million daily checks to spot and stop fraud.

19:43And most transfers happen in under 20 seconds, which means your money arrives in less time than you've been listening to me. Join millions, saving billions. Be smart. Get Wise. Visit wise.com or download the Wise app today. T's and C's apply.

20:02You're listening to the Bloomberg Business Week Daily Podcast. Catch us live weekday afternoons from 2 to 5 Eastern. Listen on Apple CarPlay and Android Auto with the Bloomberg Business app. Or watch us live on YouTube. Back to a headline that you mentioned just in the last few minutes, Carol. SpaceX has warned investors that Elon Musk could return to politics. Musk may serve in similar roles to his previous position as senior advisor to President Donald Trump and devote significant time and energy to such roles, this according to documents. It's great to have back with us Bloomberg Businessweek senior reporter Max Chafkin.

20:37Max is the co-host of the Everybody's Business and Elon, Inc. podcast, also the author of The Contrarian, Peter Thiel, and Silicon Valley's Pursuit of Power. He's here in studio with us. We didn't expect to have you back this soon, as much as we love it. I feel like you knew something here when you told us that, you know, never say never when it comes to Elon Musk and staying out of politics. I mean, this is one of these things where any investor who's learning this from the risk factor statement of the prospectus is a little bit behind the curve. It's been pretty obvious for about a year that Elon Musk's political activities have a bearing on his businesses.

21:13But this, of course, is an acknowledgment of that. And also, I guess, Tim, as you're kind of hinting, maybe a suggestion that Musk has plans to reenter the floor. Although he sort of said as much on Twitter a week ago when he launched the America Party. All right. But does this take it to if he's putting this language in the tender offer for SpaceX? I mean, does it kind of make it even more formal or official? I mean, does it take it to another level? I mean, we saw these risk factors. I'm less familiar with them as they apply to private marketing fundraising. But, of course, they do show up in public market fundraisings as well.

21:52you know, on quarterly reports, annual reports. I just had a quick peek at the last Tesla earnings release back in April. It had two new risk factors, one related to essentially perceptions about the stability of the management team, kind of a wordy way of saying negative stories about our CEO and another about tariffs and a host of other things. So, I mean, I think this is more an acknowledgement of something that is that Musk himself has talked about. And this is not, I mean, maybe this, in some ways, I guess this is confirmation that people inside of SpaceX are aware that Elon Musk has discussed very recently plans to continue his political journey.

22:35And this is a reflection of that. But how that journey could look might be a lot different than what that journey was over the last year or so, given the very public fallout that he's had with President Trump. Do you think it would take the form of a new political party and supporting candidates, perhaps Democrats and Republicans who maybe want to slash the deficit? Well, we've talked about this a lot. We've talked about this here some and also on the Elon Inc. podcast. I think there's a I think there are reasons to be somewhat skeptical of a political party in the formal sense, like a like another effort to start like a reform party or some true alternative.

23:11I think the idea of Elon Musk somehow trying to formalize this political movement, you know, in the same way that the Tea Party is not an actual political party. It's like a constituency of voters. You could imagine something like that. And and what Musk has said is, you know, or hinted at at the very least, is a plan to back certain candidates in the Senate and in Congress and then try to use that to be, you know, as a sort of point of leverage in negotiations over over bills and so on. And I think, you know, there's something to be said for that, right? If he were able to, say, peel a few Republican Senate or House votes away, like that would give him more leverage over Trump than he has now.

23:55There are also reasons why this could backfire spectacularly. All right. Let's just remind everybody, as Max has been reminding us, that, you know, he has talked about, you know, kind of staying exposed to politics or staying in politics. We're talking about Elon Musk. In fact, here's what he had to say on May 30th from the Oval Office. Well, I expect to continue to provide advice whenever the president would like. I hope so. I mean, yeah, I expect to remain a friend and an advisor. And certainly, if there's anything the president wants me to do, I'm at the president's service. All right. Again, that was Elon Musk there with Donald Trump, the president of the United States, back on May 30th.

24:37So, Max, if we read something like this, I mean, who knows? Is it going to be what? Was that the day with the black guy? That was the black guy. I just wanted to. That was parenting mishap. Yeah, sorry. The reason I ask is because you were on our program yesterday. The whole big take. It's the cover of Bloomberg Businessweek. The issue is on my desk. Right. It's all about this. This is like the financial filing equivalent of a black guy, right? An acknowledgement that there is risk here and risk for his company. I mean, just now, as we're talking about this, Musk has been tweeting sort of semi-taunting the Trump administration over reports around the Golden Dome, reports that the Defense Department might look for alternatives to SpaceX.

25:21So he's obviously moving into a sort of different position relative to the Trump administration. I'd say it's kind of similar to the one he had with the Biden administration. Although, of course, Musk's politics have changed quite a lot since then. Yeah, I guess that's what I was curious. Like, you know, is it that he's going to go back and become buddy again? Or like we just don't like in what form or is he kind of like this and just figuring out a different involvement in? Well, I mean, I think Musk has carved out an identity that puts him further, that puts him to the right of President Trump.