Tesla Profits Plunge 37% Despite Record Sales — Here’s Why

Summary

Prof G Markets – Episode Summary

Episode: Tesla Profits Plunge 37% Despite Record Sales — Here’s Why

Date: October 23, 2025
Hosts: Ed Elson
Guests: Tim Higgins (Wall Street Journal columnist), Luke Kower (Sherwood News markets editor)

Overview

This episode of Prof G Markets focuses on two major topics shaking up financial markets:

1. Tesla's Q3 earnings report—why profits plunged despite record sales, and what it means for the company’s future.
2. The latest meme stock craze, featuring Beyond Meat’s wild stock surge and crash, and the broader phenomenon of meme stocks.

Financial market news is broken down with the show's signature blend of blunt analysis and a touch of irreverence.

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Tesla’s Earnings Breakdown and Market Reaction

Key Discussion Points & Insights

[01:56-10:22]

• Tesla's Q3 2025 Earnings Highlights:
  • Record quarter for deliveries as customers rushed to take advantage of expiring US EV tax breaks.
  • Revenue up 12% YoY, deliveries up 7%, highest auto revenue in nearly two years.
  • Shock Figure: Net income down 37%, attributed to lower EV prices and increased operational costs.
  • Tesla missed on earnings per share (EPS) estimates; after-hours stock fell 4%.

Main Drivers of the Profit Drop

• Reduced Regulatory Credits:
  • Tesla's ability to sell emissions credits to competitors is “kind of evaporating.” (Tim Higgins, 04:22)
  • These credits have been a significant profit source; expected to dwindle further in coming quarters.
• Tariffs and Rising Costs:
  • Geopolitical trade tensions have increased Tesla’s operating expenses.
• Tax Credit Expiration:
  • A “huge bump” in sales was driven by US buyers hurrying to claim tax breaks before they were removed under new Trump administration policies (03:21-06:28).
  • Tim Higgins warns, “You have to kind of ask yourself, is this as good as it’s going to be for a while... given they don’t have a lot of new vehicles in the pipeline?” (03:21)

Market and Investor Sentiment

• Deliveries are solid, but much credited to the expiration of subsidies rather than underlying demand.
• The product lineup (“old in the tooth” — 06:28) is aging; the Cybertruck failed to create new excitement.
• Tim Higgins: “People want new, and the Model Y and the Model 3 for all intents and purposes are old… people want new things every couple years. And that’s one of the challenges that Tesla has.” (06:33)

Tesla’s Big Bets & Future Direction

• Next big launch: the robo-taxi — but with practical uncertainty.
• Some investors are “willing to grin and bear it here for the next few quarters as Musk has suggested. It could be a little rough as they make this incredible transition from being a car company to… a robot company.” (07:38)
• Notably, cash reserves are healthy, crucial due to the high costs anticipated for AI and automation R&D.

Industry Context: Tesla vs. GM

• GM “flushed the bad news” by absorbing EV-related losses up front and raising forward guidance, which markets cheered. (09:07)
• Both companies grappling with a slower-than-expected EV market.

Valuation and The Musk Question

• GM trades at 9x earnings; Tesla at 236x — premised on expectations that Tesla will “be a dramatically different company going forward—a robot company… a humanoid robot maker.”
• “You’re probably also thinking about what’s that future with or without Elon Musk… his pay package comes up for a vote at the shareholder meeting next month. That’s really the big thing… is kind of getting that uncertainty taken care of.” (09:50)

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Notable Quotes

• On the profit collapse:

  “Profit fell something like 37% in the third quarter. Not as good as Wall Street was hoping for. And you have to kind of ask yourself, is this as good as it’s going to be for a while when it comes to Tesla, given they don’t have a lot of… new vehicles in the pipeline in the near term?”
  – Tim Higgins, 03:21

• On product strategy and demand:

  “People want new, and the Model Y and the Model 3 for all intents and purposes are old… in the car making business, people want new things every couple years.”
  – Tim Higgins, 06:33

• On future vision and investor mindset:

  “If you’re an investor in Tesla and a long-term investor… you are making a bet that it’s going to be a dramatically different company going forward—it’s going to be a robot company.”
  – Tim Higgins, 09:50

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Meme Stock Mania: Beyond Meat’s Wild Ride

Key Discussion Points & Insights

[12:47-23:55]

Beyond Meat’s Turbocharged Stock Rally

• Shares soared 1,300% in four days after a debt-for-equity swap, then crashed so rapidly the NASDAQ halted trading.
• The initial rise was linked to a retail trader’s thesis that eliminating debt, high short interest, and new share issuance would trigger a price spike.
  • “Anything can happen… there’s really nowhere to go but up from here.” (Luke Kower, 14:34)
• Online hype, especially from Reddit and Discord, drove the run-up. The original Reddit user who sparked the craze has since been banned.

Anatomy & Lifecycle of a Meme Stock

• Key Features:
  • “It’s a lot easier to be a meme stock if you’ve effectively crashed” because of nostalgia and the “second chance” narrative. (17:04)
  • Heavily shorted with a low share price makes manipulation easier.
  • Prominent online figure makes a strong case, attracts a cohort.
  • Buyer’s binges (not just short squeezes)—demand outpaces short interest.
  • “For a buyer’s binge to continue… it bears a lot of resemblance to Ponzi finance… you need an increasing amount of buyers in demand to keep the price going up.” (Luke Kower, 17:04)
• The ultimate test: Can the company turn meme enthusiasm into lasting performance or capital? Example: GameStop used the meme rally to strengthen operations and pivot.
• Best-case: Meme-primed share price enables fundraising or strategic M&A; worst-case, bag-holders and a brutal crash.

Meme Stock Communication Channels

• Wall Street Bets (Reddit) remains highly influential but is not alone—Discord, international message boards, and social media play key roles.
• “Word gets out by someone having a strong, well-argued thesis that strikes a chord with people…”
  – Luke Kower, 21:50
• Online groupthink and “us vs. them” dynamics, especially among young, risk-taking traders.

Institutionalization of Meme Stocks

• Memes are now mainstream: “These movements are so common and so institutionalized that they are really now part of the system.” (Ed Elson, 23:56)
• Hedge funds track retail buying, some hire meme stock specialists, and meme stock ETFs now exist.
• “What started as this anarchical movement against the system is now a regular feature of the system. They are so frequent that they’re almost boring… Meme stocks are here to stay.” (Ed Elson, 23:56)

---

Notable Quotes

• On meme stock cycles:

  “Having a previous backstory of any kind of success… that’s usually a good prerequisite… The second is you do have to get beaten down a fair bit.”
  – Luke Kower, 17:04

• On meme stocks in 2025:

  “They are so frequent that they’re almost boring. Which begs the question, what is the point of meme stocks anymore? … Are they just instruments for alpha? A gambling habit for the terminally online?”
  – Ed Elson, 23:56

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Timestamps of Key Segments

• [01:56] – Tesla Q3 earnings headline breakdown
• [03:21] – Record sales, but profits plunge; why this matters
• [04:22] – Regulatory credits drying up and impact on Tesla profits
• [06:33] – Old lineup, failed Cybertruck, and hunger for new models
• [07:38] – Investors betting on robotics, AI, and Musk’s vision
• [08:56] – Tesla vs. GM: contrasting EV strategies
• [09:50] – Tesla’s sky-high valuation and questions about Elon Musk’s future
• [14:34] – Beyond Meat meme surge breakdown
• [17:04] – Meme stock lifecycle explained
• [21:50] – Anatomy of meme stock proliferation online
• [23:56] – Meme stocks’ shift from rebellion to mainstream

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Tone & Takeaways

Blunt, data-driven, but wryly self-aware, the episode underscores the volatility and unpredictability of modern capital markets—whether it’s industry giants like Tesla facing hard realities or meme stocks now woven deeply into the financial fabric. Both situations, the hosts argue, reflect a market where narrative, psychology, and online communities often move stocks as much as fundamentals.

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For Tesla Investors:
Short-term pain and mounting uncertainty, but cash reserves and long-term ambitions remain. The company’s transformation into a robotics powerhouse is a high-risk, high-reward proposition—much depends on Musk’s continued leadership and execution.

For Everyday Traders & Observers:
Meme stocks are no longer rare underdog phenomena but a persistent (and arguably institutionalized) feature of modern markets—a far cry from the early days of “sticking it to Wall Street.”

---

Produced by the Prof G Markets team; summary by AI Podcast Summarizer.

Transcript

[Luke Kower]

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[Ed Elson]

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[Luke Kower]

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[Ed Elson]

Learn [e-mail] today's number 12 that is the percentage of people in Japan who say they have eaten a meal on the toilet. The Japanese call it benjameshi or toilet meal. Economists have their own term. They are calling it vertical integration.

[Tim Higgins]

Money markets matter. If money is evil, then that building is hell.

[Luke Kower]

The show goes on.

[Tim Higgins]

Sell.

[Ed Elson]

Welcome to Property Markets. I'm Ed elson. It is October 23rd. Let's check in on yesterday's market vitals. The major indices declined on persistent trade tensions. President Trump is reportedly weighing restrictions on software exports to China. Meanwhile, gold continued its fall before paring some losses in the afternoon. Netflix stock failed to recover from its earnings hit, closing the day down 10%. And finally, semiconductor stocks tumbled after a disappointing earnings report from Texas Instruments. Okay, what else is happening? Tesla reported third quarter earnings yesterday that largely fell short of expectations. Revenue was actually a bright spot, up nearly 12% from a year earlier. Deliveries rose 7% and auto revenue hit its highest level in nearly two years. But net income fell 37% over weighed down by lower EV prices and the company also missed on earnings per share estimates. The stock fell more than 4% after hours overall. Mixed results from Tesla. Here to help us break down these earnings, we are speaking with Tim Higgins, columnist at the Wall Street Journal. Tim, thank you very much for joining us again on the show.

[Tim Higgins]

Well, thank you.

[Ed Elson]

We want to get your reactions to these Tesla earnings. Let's just start with top line takeaways. What did you make of the earnings report?

[Tim Higgins]

Well, we knew it was a record quarter for deliveries. That was as customers rushed out there to take advantage of the end of the tax breaks in the US to buy an electric vehicle as part of the broader Trump administration, getting rid of those things in his kind of anti EV push, a lot of people went out and bought electric cars. So that helped Tesla. It really helped them flush a lot of their inventory. Big surprising number though, was how much profitability fell off. Profit fell something like 37% in the third quarter. Not as good as Wall street was hoping for. And you have to kind of ask yourself, is this as good as it's going to be for a while when it comes to Tesla, given they don't have a lot of new vehicles or really any new vehicles in the pipeline in the near term? That's always a bad thing if you're a carmaker.

[Ed Elson]

Yeah. What contributed to that big drop off in net income? Down around, I think 37%. Why is that?

[Tim Higgins]

Well, several things. Right. A, tariffs are part of it. Tesla pointing that out, it's just more expensive to operate in the current environment. Tesla's traditionally had a very robust ability to sell regulatory credits to its competitors. Those credits out there in the car companies that aren't making as many electric vehicles to meet requirements by the governments around the world in the US that's kind of evaporating. So you saw that number drop for Tesla slightly and the expectation is it's going to drop more dramatically in the future quarters. So those are some big areas of hurt.

[Ed Elson]

So the stock dropped in after hours trading. What do you think the market makes of this?

[Tim Higgins]

I think the initial take from the market is that that profitability figure is concerning as you just look ahead and you look ahead with what the company has to play with in an environment in the U.S. yes, they have brought out a cheaper Model Y SUV, a cheaper Model 3 sedan in recent months, but it's still not, it doesn't really make up for the loss of those EV tax credits, tax breaks that customers were getting in the US So the idea that essentially you have a price increase on your lineup that is rather old.

[Ed Elson]

You mentioned the deliveries, which are up 7%, highest auto revenue in almost two years. I think a lot of people would see that and they would think, okay, this is Good. Tesla's doing well. But you mentioned that pull forward effect where you have the EV credit expiring. It did expire. This earnings report is measuring the previous quarter. Therefore a bunch of people went out and they bought Tesla's ahead of the expiration of that credit. How much of this bump do you think is because of that? Or do you think we're being unfair to Tesla? I only ask the question because people often say we're often kind of Tesla bears on this show. People often say we're being unfair.

[Tim Higgins]

It would seem to be a huge bump from people rushing out to take advantage of that tax break, if you will. You know, maybe we'll see some pickup from the cheaper Model 3, Model Y though. That's to be determined. I mean, when you look at it, you know, people want new and the Model Y and the Model 3 for all intents and purposes are old, in the tooth. And in the car making business, people want new things every couple of years. And that's one of the challenges that Tesla has. They put a big bet on the cybertruck, a very kind of unique looking vehicle that has failed to excite a lot of buyers the way they thought that Elon Musk kind of projected that it would. The cupboard's kind of bare. The next big thing is the robo taxi vehicle. But that is not a vehicle meant for people to drive themselves. It's another vehicle that's probably going to be in low volumes to begin with, if forever, who knows? I mean, the projections are huge, right? But we haven't seen kind of the business plan yet for how that's going to work, work out, people buying it themselves, what markets they can use it in, that sort of thing. So a lot of big questions, a lot of big bets. There are some investors out there who see that as the future, who see humanoid robots as the future and they're willing to just kind of grin and bear it here for the next few quarters as Musk has suggested. It could be a little rough as they make this incredible transition from being really what is a car company to the idea of a robot company and kind of those getting their sea legs for that.

[Ed Elson]

Did we get any updates on the robots or on autonomy in this report?

[Tim Higgins]

Yeah, no. The free cash flow is interesting. They're sitting on a lot of cash now at Tesla, which is I think an important thing because this AI future is going to be very expensive as you're making that transition. The car make. It's still a car maker, right? It's still depending upon Making cars and in a bad economy, if we go into a bad economy, that can just eat a lot of cash. So that's a good position to be in. It's probably a better position than some car companies as they try to figure out how they're going to adapt to the future. Especially in a world where if you're a western car maker, you're looking at what's coming out of China and you're very nervous. The world is changing very rapidly, whether it's going to be Chinese automakers or how AI is going to disrupt the business.

[Ed Elson]

How did this compare to GM's earnings which were released yesterday? What's your picture of GM versus Tesla right now?

[Tim Higgins]

Well, GM seemed to have ahead of it flushed the bad news. It took some hits on the EV business. And then as they look forward, they've raised their guidance and the market was really kind of excited about that potential, that maybe they're putting the bad news behind them. Kind of readjusted for this complicated EV transition that's ahead. On one hand, it's clear that the EV business for everyone is not growing in the way they thought. Yet there's still signs of potential growth.

[Ed Elson]

Yeah. Just as we wrap up here, valuation. GM's trading at 9 times earnings. Tesla's trading at 236 times earnings. Any final thoughts on the Tesla valuation right now?

[Tim Higgins]

Yeah. If you're an investor in Tesla and a long term investor in Tesla, you are making a bet that it is going to be a dramatically different company going forward. It's going to be a robot company. It's going to be a robot taxi service. It's going to be a humanoid robot maker. And you're probably also thinking about what's that future with or without Elon Musk. Remember, his pay package comes up for a vote at the shareholder meeting next month. That's really the big thing that I think is hanging out there is kind of getting that uncertainty taken care of.

[Ed Elson]

All right, Tim Higgins, columnist at the Wall Street Journal. Thank you for joining us. We appreciate your time.

[Tim Higgins]

Thank you.

[Ed Elson]

After the break, a new meme stock has emerged. If you're enjoying the show, give Prof. G Markets a follow.

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[Ed Elson]

This episode is brought to you by State Farm. Listening to this podcast Smart Move Being financially savvy Smart Move Another smart move Having State Farm help you create a competitive price when you choose to bundle home and auto bundling. Just another way to save with a personal price plan. Like a good neighbor, State Farm is there. Prices are based on rating plans that vary by state. Coverage options are selected by the customer. Availability, amount of discounts and savings and eligibility vary by state. We're back with Profgy Markets. Beyond Meat became the latest meme stock this week, with shares surging more than 1,300% over four days. The frenzy kicked off late last week and got an extra boost on Tuesday when Walmart announced it would expand Beyond Meat's products to more than 2,000 stores. Shares soared another 112% yesterday morning, but by early afternoon, the stock gave those gains back. So a run up of over 600% this week for Beyond Meat, the meat alternatives company, until yesterday when the stock corrected so harshly that the NASDAQ actually had to halt the stocks trading. So what is behind the Internet's latest meme stock? We're not so sure. We don't think investors are quite sure either. So to help us understand this meme stock craze, we are speaking with Luke Kower, markets editor at Sherwood News. Luke, thanks for joining us once again.

[Luke Kower]

Oh, great to be back, Ed.

[Ed Elson]

So we want to get your breakdown on what is going on with Beyond Meat here. Absolutely ripping and then falling. And then we see the NASDAQ halts the trading of the stock. Where did this all start? What actually caused this obsession with Beyond Meat?

[Luke Kower]

So I would say it started really last week when the company early last week announced that it had completed an early previously announced intention to swap some debt for equity. So this meant that it would be retiring a fair amount of debt that was due in 2027, still having some convertible notes outstanding that had now have a higher coupon than what they actually previously retired. But their share count would be going up from about 76 million to 392 million based on this change. So that caused the stock to go to an all time low of 50 cents after this. A group of retail traders and one in particular who's a Dubai based real estate developer that Business Insider has reported on. Very good work there to give a shout out. Started just putting out a thesis about. Hey, nope. Now that the debt has been mostly eliminated, this is a very positive Runway for the company. Anything can happen. The new bondholders won't want to sell these new shares until a certain point and there's still a decent amount of shortage interest on the stock. So you know what, there's really nowhere to go but up from here. And so then we saw on Friday the stock go up 20% based on kind of the early innings of that thesis. And then this week in every single session, it's gone up 100% at least intraday at its peak. The, the zenith I would say today was when it was up 146, I believe percent at its peak today, just on the day that was in the pre market session.

[Ed Elson]

Right.

[Luke Kower]

And it managed to close down less than 1%. So we are talking about the, the craziest 4 cent move in a stock that I've ever seen.

[Ed Elson]

You've done a lot of research on meme stocks. Could you just describe for us Kind of generally the life cycle of a meme stock. I mean, it sounds like this, this meme stock movement really occurred because there was a trader who said something on some message boards on Reddit. And then slowly but surely, and then very, very quickly, people started to pile in. But then I think the question becomes, what happens next? So when you look back at all these other meme stocks that we see, and we've seen many of them, what is sort of the overall life cycle? How does it play out? How does it begin? What's the middle, and then what's the end?

[Luke Kower]

So first thing in kind of identifying a meme stock move is you have to look to its history. It's a lot easier to be a meme stock if you have effectively crashed. If this is your second chance, if you've. Because that means you've been at a height before where people can benchmark to you and say, okay, in 20, in 2010, you were worth this. In 2021, you were worth this. You were trading at five times forward sales. All you have to do is get back there again and then we're all rich. So having a previous backstory of any kind of success, whether that's operationally or just being being treated well by the market, that's usually a good prerequisite for identifying a name. The second is you do have to get beaten down a fair bit. I was kind of taught by mentors growing up that you never really short a stock when it's below $5 in terms of a nominal price because, you know, anything can really happen at that point. It doesn't take as much money to be able to move the stock a lot, have it double, have it get out of hand, and have you really hating your life at that point. So what we got in this case was still elevated short interest as a percentage float, though I really got to emphasize that it went down a lot in this case because of how many shares are issued. But having a lot of shorts outstanding is pretty good, not only because it creates the illusion of, okay, there is some. There's an us versus them dynamic, and there's someone here that is going to lose by virtue of my buying behavior. That's usually really good in developing community and camaraderie around a name. And then the next thing is the flows. You see flows that are way in excess of what would be kind of required to, quote, unquote, squeeze the shorts. So it's. That to me, is the indication that it's really a buyer's binge. Buyers have Taken over. You will see it a lot both in terms of just the pure volumes and you will see it a lot in terms of the options flows. And this is the story that. This is the part of the story that we're kind of in and is the most important. I don't necessarily see this as a short squeeze. See it as a buyer's binge and for buyer's binges to continue. I'm not going to call it a pause scheme. I'm just going to simply say it bears a lot of resemblance to Ponzi finance and that you need an increasing amount of buyers in demand to keep the price going up. I don't think that's all too controversial of a statement. So when you're in this kind of stage of the meme cycle, you need to see increasing volumes, increasing options volumes to be able to spur the kind of demand that keeps the stock going up and up and up in seemingly a parabolic fashion. And then kind of the next phase is you either have to prove it or not. No company stays a meme stock forever. Volumes at some point have to plateau and go down. You have to stand on your two feet. You have to show some signs of operational change and performance. For a lot of companies, being a meme stock is what allows for that. It's having the boom in your share price that then allows you to go out and raise a lot more money and, you know, give yourself a new lease on life, give the ability to burn cash for another few years while you figure things out or perhaps pursue transformational. Transformational M and A. That was kind of the thesis around GameStop and what it did. But the very interesting story about GameStop is all it's really done since being a meme stock twice, is get a really, really strong operator in Ryan Cohen, who has controlled cost and now generated positive cash flow for five straight quarters. Operating cash flow for the first time in GameStop's history. So nobody really talks about it as a meme stock anymore. But what investors still do at that point is they ascribe a pretty high value to the cash on its balance sheet because of the idea that, hey, we've given the cash to someone who knows what to do with it. So that kind of, to me is how I see in best case scenarios, things going to for meme stocks, you effectively, you have blow off tops along the way as kind of interest dissipates because you're not producing the same type of consistent and big daily gains that are required to get more and more People interested in the stock, but you have the opportunity the market has provided you with the opportunity to do something new and different with your business or keep doing the same thing for longer.

[Ed Elson]

Yeah, it's sort of either you cross your fingers that management figures their stuff out or cross your fingers that you're not left holding the bag. How do they proliferate online? Is it all Wall street bets? I mean we know that's how GameStop came about. We know how that's how AMC came about. I mean there are many stocks you could choose and many meme stock movements, some more interesting and more explosive than others. But how do they, how does word get out?

[Luke Kower]

Word generally gets out by someone having a strong, well argued thesis that strikes a chord with people. In the case of GameStop, even it was it really I think picked up when Keith Gill was posting, you know, effectively screenshots of his position and thesis on Reddit. But his initial work was on YouTube live streams, really hardcore fundamental analysis that struck a chord with people and got one cohort in and then later, many, many. So I would say there's kind of a variety of sources. Wall Street Bets I would say is still probably the most prominent. But you know, as we're seeing, I've, I've been on Korean message boards for the first time in quite a long while today, so there's certainly other places where it's happening. A lot of discord servers are things where single stocks are discussed. A lot of trading groups and communities there.

[Ed Elson]

Same with all young people, young people who are quite online.

[Luke Kower]

I would presume that yes there the, the Venn diagram here of, of young men who are willing to take more risk and people who have bought Beyond Meat in the past few days is more or less one circle. Yes, but I would say a variety of different places online very much still WallStreetBet centered. What is interesting in this case is that the, the gentleman who brought the thesis forward on Reddit has since been banned from Reddit. Those former posts have been expunged. And one very, very funny thing that interests probably anything else is that a lot of the kind of scraping algorithms that will run how much is this ticker mentioned on Wall Street Bets to try and get a handle of, of how much demand or interest there there might be. I feel like Beyond Meat has broken that scheme because nobody there refers to it by its ticker. They call it fake meat 10 times more than beyond. So if you're scraping there for, for a ticker, you're not going to see it nearly as Much that has changed, I will say, a lot in the past day.

[Ed Elson]

Very interesting. Luke Kauer, market editor at show and News. Appreciate you breaking down how Beyond Meat has become such a sensation. Thank you for joining us.

[Luke Kower]

My pleasure.

[Ed Elson]

Well, if you're reading the headlines, you would probably think that what happened this week with Beyond Meat is somewhat extraordinary or some sort of market defining event. We saw huge headlines in the New York Times, in the Wall Street Journal. Barron's even made a link between Beyond Meat and Gold, calling them Wall Street's newest odd couple. So there's a lot of interest in this Beyond Meat stock and the Beyond Meat story. And it might make you think that this run up is novel or surprising or in some way unprecedented. But we should be very clear. Meme stocks, they may once have been novel, but they are definitely not anymore. They are really commonplace. In just the past few months, we've seen Krispy Kreme, which went up 50%. We saw QuantumScape, which went up 200%, Plug Power up 200%, Navitas up 500%, Opendoor up 1,000%. And in each of these cases, you had a company that had no real change in the business, but rather some sort of online fervor which resulted in coordinated purchasing among traders, and it sent the stock flying. And the same happened here again with Beyond Meat. Now, the numbers might be extraordinary, but the story itself isn't. Because what is clear at this point is that meme stocks are here to stay. They are a regular feature of financial markets. They're practically as common as activist investments and SPACs and even IPOs. They are par for the course, which is just an interesting diversion from what they used to be about, because they used to be extraordinary. When you look back at the GameStop saga or AMC, each of which was touted as a big way for retail to fight against the system, to put Wall Street's back against the wall and to bleed them of billions of dollars. And in some cases, it worked. We saw it with Melvin Capital and Archegos Capital, both of which went out of business. But that's not really the case anymore. I mean, these movements are so common and so institutionalized that they are really now part of the system. When you look at hedge funds, 9 out of 10 hedge funds are tracking retail traders on social media. Many are hiring meme stock experts. And we're even seeing meme stock ETFs that of course charge an expense fee just like any other etf. Put another way, what started as this anarchical movement against the system is now a regular feature of the system. They are so frequent that they're almost boring. Which begs the question, what is the point of meme stocks anymore? Do they accomplish anything? Do they say anything? Do they stick it to anyone? Or are they just instruments for alpha? A way for traders to make a quick buck? A gambling habit for the terminally online? Now, in 2021, maybe that question would have been debated. But four years and hundreds of meme stocks later, we're not so sure. Okay, that's it for today. This episode was produced by Claire Miller, edited by Joel Patterson and engineered by Benjamin Spencer. Our associate producer is Alison Weiss. Our research team is Dan Shalon, Isabella Kinsel, Kristen o' Donoghue and Mia Silverio. And our technical director is Drew Burrows. Thank you for listening to Profg Markets from Profg Media. I'm Ed Elson. Tune in tomorrow for our conversation with Daron Acemoglu.