Share the AMC insanity: ‘Ape’ cult hits its last stand as stock falters

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To follow the market travails of AMC Entertainment, a money-losing movie theater chain, is to come to terms with the phenomenon of how mass psychosis has taken over stock investing.

Yes, there have always been manias in the markets, but this one is different. What we have in the AMC imbroglio is a mania fueled by a cult-like conspiracy theory that is causing damage far beyond a few warped souls losing their shirts.

The AMC cult begins with an odd theory that shares are secretly controlled by a cabal of evil hedge funds that want to put the company out of business by illegally shorting the stock. In a regular short sale, a trader borrows a stock, sells it, then (hopefully) buys the stock at a lower price to return to the lender.

Hedgies, the conspiracy goes, take it a step further by magically creating fake or synthetic shares that put enormous downward pressure on the stock. They had their way for years until the so-called AMC Apes got involved.

‘Crush the bad guys’

The Ape rallying cry can be seen on Reddit message boards urging the following to buy AMC and crush the bad guys — essentially taking back the markets from Wall Street and return them to the people. Like most cults, us-against them do-gooding resonates with people looking for a life. Shares began to climb around this time last year, taking a penny stock to new heights as the Apes predicted a short squeeze that will send AMC stock “to the moon.” They will get rich and teach Wall Street a lesson.

If there’s evidence the manipulation theory is true no one has seen it. The Apes did drive the stock above $70 in June. But they’ve been down 80% ever since. Far from sticking to Wall Street, hedge funds have traded in and out of the stock opportunistically.

Despite all of this, the cult has continued to grow and has kept buying while the stock falters, delaying the inevitable hard landing because of AMC’s continued disastrous fundamentals and the Fed popping the market bubble with higher rates.

In this photo illustration an AMC logo seen displayed on a smartphone with binary code on a laptop screen.
The motive behind the Reddit users to buy AMC stock was to get rich and teach Wall Street a lesson in the process.
SOPA Images/LightRocket via Getty Images

The latest example came last Tuesday when AMC pre-announced widening operating losses. Shares exploded double-digits pre-market. AMC cultists found a sliver of good news that the company is expected somewhat higher revenues. After a day or so of gains on decent volume, reality set in and the stock resumed its more recent decline.

In hindsight, it was inevitable that the lure of the cult would carve out an investing niche. We are all hooked on technology that encourages groupthink and this technology makes stock trading seamless for the masses.

With the COVID lockdowns, people literally had nothing to do than gamble their stimmie checks. Fed added unprecedented liquidity meaning buying stocks for a time was a no brainer. Throw in societal dysfunction — message boards replacing face-to-face communication — plus the very human tendency for confirmation bias, and you can get something like QAnon of stocks.

But people get hurt believing in stuff that defies rational thought, and the AMC cult is and will be no different. Eleanor Terrett of Fox Business listened in on a group call where one of the aforementioned Apes said: “To you new Apes … I know you all are red … I get it. I didn’t sell at $77 … I’m not selling now. I’ve lost enough to buy a house with cash.”

This gent said he bought in January so he’s still in the green for now. Many others won’t be so lucky because cults — not to mention pyramid schemes — never end well.

The NYC Partnership for Crony Capitalism

Governor Hochul, Mayor Adams attend Officer Rivera's funeral.
Gov. Kathy Hochul recently met with embattled Manhattan DA Alvin Bragg.
EPA / Justin Lane

It was impossible not to shed a tear witnessing that amazing sea of multicultural blue stretched up Fifth Avenue Wednesday during the funeral procession for the slain officer Wilbert Mora.

New York’s Bravest were mostly silent during the beautiful and sad eulogy, but you know what was on their minds: A plea to the local politicians and business leaders to reverse years of progressive attacks on the police and give them the tools to restore civil order. 

Governor Hochul, however, won’t do that because she’s too afraid of alienating the Democratic Party’s lefty fringe during a primary challenge. Neither will the gutless souls who run the city’s largest business lobby group, also known as the Partnership for New York City.

Sources tell me the Partnership’s CEO Kathy Wylde has now joined Hochul in a pathetic kumbaya moment: Both want to give one of those progressives handcuffing the police, namely the wacky Manhattan DA Alvin Bragg, chance to do his job. 

This is the same Alvin Bragg who recently announced during a crime wave he was not going to do his job and prosecute most criminals. That announcement caused such a stir among Wylde’s membership — the NYC business elite — that she demanded meetings with Bragg.

Manhattan District Attorney Alvin Bragg
Bragg reversed some of his controversial policies, including calling for commercial robberies committed with knives to once again be prosecuted as felonies.
Steven Hirsch

It’s easy to understand the politics involved in Huchul looking to cut Bragg “some slack.” Wylde’s about face involves something more inchoate but just as sinister: “crony capitalism.” Her members — banks, real estate companies and big investors — do a ton of business with the state so she needs to do Hochul’s bidding to keep the money flowing. 

Asked about her flip-flop, Wylde tells the Post: “Do you care more about demonizing the DA than fixing the situation? We are facing a crisis and the DA has to be part of the solution. We are helping the DA gather information and cooperation from businesses whose employees and customers are victims of the deteriorating situation in NYC.”

My question for Kathy: Do you think making your members a few bucks on Albany’s largesse is worth turning the city over to criminals?

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