WallStreetBets Rebellion Rally Is A Bubble That Will Burst, Peter Boockvar Warns - American Airlines Gr (NASDAQ:AAL), GameStop (NYSE:GME)

Bleakley Advisory Group chief investment officer Peter Boockvar calls the Reddit-fueled rebellion rally a “parabolic bubble” in the CNBC interview.
In a research note, Boockvar warns that mania trades into GameStop Corp. GME and American Airlines Group Inc AAL will ultimately go bust.
“Let’s break down the investment strategy: Find the most shorted stocks, buy calls, write about it, buy the stocks and jam it higher,” said Boockvar.
The prices of these securities far exceed the underlying value of companies.
Boockvar said that markets’ history shows that bubbles start the same way and then pop right “back to where the stock started from.”
He also blamed Fed’s loose monetary policies for the rise in speculation, though he admits that the policy was not intended to help “investors get drunk on dangerous trades.”
“We have to understand that the purpose of essentially free money via zero rates and QE is to encourage risk-taking. It is meant to scare money out of a savings account, a CD, or T-bill and into riskier assets. It thus encourages riskier behavior on purpose,” he added.
According to Boockvar, the euphoria is touching dot-com-bubble euphoria levels.
Price Action: In the pre-market session on the last check Friday, GME is 97.3% at $382, and AAL is up 14.1% at $20.65.
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