US financial services committee names witnesses for GameStop hearing
15 February 2021 US
Image: Jason_Yoder/adobe.stock.com
In the wake of the GameStop ‘meme stocks’ drama, the US House Committee on Financial Services, which oversees the country’s financial services sectors, has revealed the witnesses due to testify at this week’s hearing on “predatory” short selling and its impact on retail investors.
Speakers include Robinhood CEO Vlad Tenev, hedge fund Citadel CEO Kenneth Griffin, Reddit CEO and co-founder Steve Huffman, Melvin Capital CEO Gabriel Plotkin, and day trader Keith Gill, who is credited with rallying the retail interest in GameStop through Reddit forum WallStreetBets.
Tenev is expected to face questions around the events that forced the Robinhood trading platform to briefly ban buy orders on several volatile stocks including GameStop to allow the broker to refinance its collateral account with its central counterparty.
The move was widely condemned by the retail community with many suggesting Robinhood was protecting short sellers. The US Securities and Exchange Commission also voiced concern.
Plotkin and Griffin will be ambassadors for the short selling and securities lending communities and will likely face tough questions about whether the practice creates systemic market risk and unreasonable downward pressure on stock prices.
US congresswoman and committee chair Maxine Waters announced the hearing at the end of January citing a need to address “predatory short selling” by hedge funds which she claims are “preying on the pension funds of hard-working Americans”.
Waters said she wanted the hearing to examine the recent activity around GameStop and other impacted stocks “with a focus on short selling, online trading platforms, gamification and their systemic impact on our capital markets and retail investors”.
The virtual hearing, entitled ‘Game Stopped? Who Wins and Loses When Short Sellers, Social Media, and Retail Investors Collide’, will take place on 18 February
at 12 PM ET (5 PM GMT).
Since taking the reins of the committee in 2019, Waters has focused on protecting customers and investors and is not afraid to haul big tech leaders and CEOs of large financial institutions before the committee, including Facebook founder Mark Zuckerberg and Twitter founder Jack Dorsey.
The hearing is a response to the bizarre skyrocketing of GameStop’s share price which captured the world’s attention and made January the most-revenue-generating month for US equity finance on record — $453 million, a 75 per cent year-on-year increase.
The genesis of the GameStop event came in the form of Citron Research’s Andrew Left announcement that his fund was short GameStop, after which Reddit forum WallStreetBets took umbrage with the perceived attempt by short sellers to crush the franchise which forum posts from the time indicate users have fond memories of.
Speakers include Robinhood CEO Vlad Tenev, hedge fund Citadel CEO Kenneth Griffin, Reddit CEO and co-founder Steve Huffman, Melvin Capital CEO Gabriel Plotkin, and day trader Keith Gill, who is credited with rallying the retail interest in GameStop through Reddit forum WallStreetBets.
Tenev is expected to face questions around the events that forced the Robinhood trading platform to briefly ban buy orders on several volatile stocks including GameStop to allow the broker to refinance its collateral account with its central counterparty.
The move was widely condemned by the retail community with many suggesting Robinhood was protecting short sellers. The US Securities and Exchange Commission also voiced concern.
Plotkin and Griffin will be ambassadors for the short selling and securities lending communities and will likely face tough questions about whether the practice creates systemic market risk and unreasonable downward pressure on stock prices.
US congresswoman and committee chair Maxine Waters announced the hearing at the end of January citing a need to address “predatory short selling” by hedge funds which she claims are “preying on the pension funds of hard-working Americans”.
Waters said she wanted the hearing to examine the recent activity around GameStop and other impacted stocks “with a focus on short selling, online trading platforms, gamification and their systemic impact on our capital markets and retail investors”.
The virtual hearing, entitled ‘Game Stopped? Who Wins and Loses When Short Sellers, Social Media, and Retail Investors Collide’, will take place on 18 February
at 12 PM ET (5 PM GMT).
Since taking the reins of the committee in 2019, Waters has focused on protecting customers and investors and is not afraid to haul big tech leaders and CEOs of large financial institutions before the committee, including Facebook founder Mark Zuckerberg and Twitter founder Jack Dorsey.
The hearing is a response to the bizarre skyrocketing of GameStop’s share price which captured the world’s attention and made January the most-revenue-generating month for US equity finance on record — $453 million, a 75 per cent year-on-year increase.
The genesis of the GameStop event came in the form of Citron Research’s Andrew Left announcement that his fund was short GameStop, after which Reddit forum WallStreetBets took umbrage with the perceived attempt by short sellers to crush the franchise which forum posts from the time indicate users have fond memories of.
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