They’re back. It’s not the businesses making a comeback; it’s the same reckless behavior wrapped in new tickers. Meme stocks are ripping on no news, no turnaround, just vibes, and short interest déjà vu from 2021. Kohl’s surged nearly 40%, not because of earnings, not because of strategy, but because some folks online decided it should. That’s all it takes now. Retail’s lit again. But scroll the forums, and it’s all heat, no floor, no fundamentals. If this feels familiar, it should. GameStop. AMC. Bed Bath & Beyond. We’ve seen how this plays out.
The move looks smart, until it isn’t. And the fall is usually as sharp as the rise.
But this isn’t about Kohl’s. It’s not even about stocks. It’s about memory. Or lack of it. The meme resurgence tells us less about opportunity and more about the refusal to learn. Investors aren’t just repeating a trade; they’re repeating a mistake. This isn’t a rerun of a trade. It’s a rerun of a train wreck and if you know where to look, the signs are everywhere.
What Meme Stocks Did To Retail Last Time
We don’t need to guess how this plays out. We’ve already lived it. Back in August 2023, I laid it bare in Why You’re Almost Guaranteed to Lose Money Trading GameStop, AMC & Other Meme Stocks. The pattern was clear: online hype caught fire, retail flooded in late, and institutional money used the wave to cash out. Social chatter turned into FOMO flows. Stocks surged. Then came the rug pull.
Most retail traders weren’t early; they were ammunition. They bought the highs and sold the pain. Meanwhile, professionals, armed with liquidity and exit plans, let the frenzy work for them.
GameStop soared above $480 at its peak. Today, it trades under $30. AMC touched $72. It now limps below $5. That’s not “hold the line” loyalty. That’s capital destruction. And yet, with the same names trending again, the crowd looks ready to walk into the fire a second time.
The Real Lessons From The Meme Stock Bubble
The meme stock bubble wasn’t just a wild moment—it was a classroom. And in my January 2024 piece, What We Learned From The Stock Market Meme Bubble, the takeaways were clear. First: narrative is not strategy. A good story might move price in the short term, but it doesn’t anchor value. Second: short interest, while flashy, is not a catalyst. It’s a setup, not a reason to buy.
Third, and maybe most crucial: community isn’t capital. Online unity might create a movement, but it doesn’t replace liquidity or discipline. And finally, behavioral traps ruled the day, confirmation bias, herd mentality, and the illusion of control all played leading roles.
As I wrote then: “Retail got a taste of power—and then a dose of reality.”
The lessons were there in plain sight. Anyone willing to step back from the noise could see the cracks forming. But in every mania, reason is the first casualty. And now, as the same trades cycle back into fashion, we’re finding out just how few people were paying attention.
What’s Happening Now
We’re seeing the signs again. This time it’s Kohl’s. The stock jumped nearly 40% in a single session on absolutely nothing. No earnings release. No new strategic plan. No operational inflection. Just movement. And in 2024, that’s all it takes to light up Reddit threads and X timelines with déjà vu-level energy: “Squeeze coming.” “Institutions are scared.” “This is the next GameStop.”
According to Barron’s, it’s meme traders driving the action, again using short interest as a battle cry, not a risk signal. And that’s the issue. The crowd sees a high short float and mistakes it for an opportunity, not a warning. The irony? The very setup they’re piling into is the one institution are often waiting to sell into.
What’s changed since 2021? Not much, except now there’s no stimulus check liquidity, no novelty in zero commissions, and far less of a surprise factor. What’s left? Noise with no fuel. Urgency built on fumes.
As I warned in my May 2024 piece, The Risk Of Losing Big On GameStop And Other Meme Stocks: “Retail investors often confuse movement with meaning. Just because a stock moves doesn’t mean it’s moving for you.”
This time may look familiar, but the backdrop is very different. And when the music stops, it won’t be the short sellers left standing without a chair.
The Psychology Driving Meme Stock FOMO
This latest meme stock wave isn’t driven by analysis; it’s driven by psychology. Recency bias leads traders to believe that because a squeeze happened once, it will happen again. Survivorship bias keeps them focused on the few who struck it rich last time, not the thousands who got burned. Add in community bias where being part of the crowd feels like validation and you’ve got a cocktail for poor decision-making.
What’s really fueling this is social reinforcement. TikTok clips showing fake P&L gains. X posts hyping charts with no context. The illusion of credibility from anonymous accounts shouting conviction. It’s all theater. And with every like, share, and comment, that group think spreads.
What’s missing? Due diligence. Valuation. Anything resembling a thesis beyond “shorts will cover.” This isn’t investing. It’s a TikTok trend with margin calls. The danger isn’t just that these trades unravel. It’s that the behavior behind them keeps getting rewarded by attention, not outcome. And when the feedback loop breaks, the fallout is real.
The Structural Problem
Even when meme stocks spike, most traders don’t win. The reason isn’t just timing; it’s structure. Liquidity vanishes at the top. Platforms freeze. Bid-ask spreads widen. Right when you should sell, conviction freezes. Hesitation takes over. Emotion takes over. No plan, no discipline, just the hope it’ll go higher. Nail the entry? Great. Now try getting out before the bid vanishes.
These trades sell the illusion of repeatability. But the structure doesn’t support the outcome. Most retail investors are playing a game where the rules shift mid-trade. The system isn’t built for fast exits or disciplined decision-making at scale.
And that’s the catch: meme stocks promise outsized gains but offer little in terms of practical execution. By the time you hear the alarm, the exits are already jammed. That’s the meme stock playbook. It’s hard to win when the game isn’t designed for you to leave with chips.
What’s Next For Meme Stocks: A Familiar Trap
We’ve seen this script before and it doesn’t end well.
Here’s what’s likely next. One or two meme names pop, and Kohl’s is already on that path. Maybe Bed Bath & Beyond will return from the dead via some illiquid microcaps. Social media does the rest. Reddit threads light up. TikTok gets flooded with charts and rocket emojis. “The squeeze is on.” Retail starts piling in. FOMO kicks in hard. Flows accelerate.
Then the air starts thinning. Liquidity evaporates. The same volatility that attracted traders begins to repel them. Without fundamentals or fresh capital, prices collapse under their own weight. Retail holds the bag, again.
The difference this time? The players who won last time weren’t even on the field. Institutions aren’t surprised. Market makers are prepared. There’s no novelty here, just a rerun.
But it’s a rerun with worse odds. No stimulus tailwind. No surprise factor. No second wave of liquidity. This isn’t momentum. It’s old muscle twitching in a dead trade. And those hoping for a different ending are ignoring the script.
The Meme Stock Sequel Will End the Same Way
Meme stocks aren’t back because the fundamentals changed. They’re back because memory faded and the crowd got bored. That’s not opportunity; it’s risk in disguise. In any greater fool game, the last one is the one who loses most. So, take this as a warning, not a headline to chase. Just because stocks are moving doesn’t mean they’re moving toward profit. Ask anyone who is still holding AMC. You’ve seen this movie before, and the ending didn’t change. And like every sequel, this one’s got the same ending, just fewer people left to cheer.