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Subject:  Ramifications of Gamestop Frenzy Date:  2/15/2021  11:32 AM
Author:  tjscott0 Number:  41129 of 41170

America loves a good underdog story — and that’s exactly what it got in late January, when a plucky band of netizens on Reddit’s r/wallstreetbets message board decided to stick it to Wall Street by collectively driving up the price of GameStop, a video-game retailer best known for its brick-and-mortar stores.
Regardless of the winners and losers in the GameStop trading frenzy, however, the episode did spark a rare moment of bipartisanship in Congress (albeit short-lived), with both Republican Sen. Ted Cruz of Texas and Democratic Rep. Alexandria Ocasio-Cortez of New York calling for investigations into what happened
At this point, though, polling suggests that bipartisan support for the small-fry investors is high, although Americans from both parties are fairly split on whether they support further regulation of the financial markets.

So what is the federal government doing?
The Biden administration is sending a clear signal to Wall Street that the industry's Washington cops are back on the beat. Regulators and federal prosecutors are probing potential misconduct in the GameStop trading frenzy, as the Securities and Exchange Commission moves to restore harsher penalties on wrongdoers.

The article goes into how "Attorneys in the Justice Department's criminal division are conducting a wide-ranging investigation into possible market manipulation from the trading surrounding GameStop, and recently issued a subpoena to Robinhood as part of that, a person familiar with the matter said. The probe, though, appears to be in its early stages.

Specifically, she indicated the agency is looking into whether brokers such as Robinhood complied with regulations when they limited trading in certain so-called "meme stocks." And she said the agency is looking for signs of market manipulation amid the trading mania."

I see the federal government is putting Robinhood under the microscope. I see butkus regarding looking at hedge funds.
Hm nice to see campaign donations have kept the DOJ firmly leashed at to whom to investigate. And perhaps it right to do so as the stock market is similar to a private club. Best to keep the riff raff under control if one cannot keep them out. After all 84% of stock market share are owned by the 10%* (The top 10% of American households, as defined by total wealth). 50% by the top 1%**.

So a return to business as usual. But is that really possible?
Judging from BLM protests & January invasion of the Capital building it appears the mob is restless and polarization within the country is alive and well.
One can only imagine the the macroeconomic upheaval from a political election disturbance if the stock market is perceived as a "rigged" game vastly tilted toward the wealthy whom can drive stocks prices up or down mostly for their benefit.

There is a lone voice from the wilderness calling for an investigation of the hedge funds:Senator Warren.
Elizabeth Warren told the SEC to 'grow a backbone' and regulate hedge funds in the wake of the GameStop-Wall Street saga

Sen. Elizabeth Warren said the GameStop saga showed why hedge funds needed heavier regulation.
"It's a rigged game," the longtime critic of Wall Street told CNN on Sunday.
She said the SEC should introduce regulation meant to empower individual investors.
Warren also slammed hedge funds and investors, saying they had treated the stock market "like their own personal casino."

Any bets if she will be primaried in 2024? Likely big money from the financial sector for anyone looking to unseat her.

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