For Rep. Patrick McHenry (R-N.C. 10th District), ranking member of the House Financial Services Committee and proponent of more open financial markets, the GameStop trading frenzy presents an opportunity to further democratize investing.
"This is a true power-of-the-people moment, where you see Reddit users… that communicated with each other about what large sophisticated hedge funds were doing to a particular stock, and so they took action," McHenry told Cheddar.
The committee will hold hearings on the incident in the next two to three weeks, according to McHenry. The goal, he said, is to better understand if there are any legal issues to address and if the David-and-Goliath media narratives pass the muster of closer scrutiny.
"We need to understand if any laws were broken, if any regulations were broken here, and what exactly happened with this larger moment of Reddit users outsmarting and outwitting hedge funds," he said.
The representative also stressed that the hearing would not focus on a single company, such as Robinhood, which has gotten heavy criticism from fellow lawmakers on both sides of the aisle for limiting trading activity of Reddit-targeted stocks in the middle of the buying spree.
Robinhood CEO Vladimir Tenev recently said in a conversation with Elon Musk that the restrictions were meant to help the company conform to capital requirements. McHenry said regulations concerning capital requirements for broker-dealers could also be on the docket.
"We have to make sure that the regulations are appropriate for broker-dealers to hold capital," he said. "We need to understand the clearing process."
Ultimately, he said it should be easier for newcomers, such as the wave of investors who piled into GameStop stocks, to take advantage of financial markets.
"What this moment shows me is that average, everyday investors can be quite sophisticated, and simply having a wealth standard is not a sufficient mechanism," he said. "We need to ensure that people can test into the accredited investor standard, so that these average, everyday investors can get those deeper, earlier access to sophisticated products."
The Rev. Al Sharpton is set to lead a protest march on Wall Street to urge corporate America to resist the Trump administration’s campaign to roll back diversity, equity and inclusion initiatives. The New York civil rights leader will join clergy, labor and community leaders Thursday in a demonstration through Manhattan’s Financial District that’s timed with the anniversary of the Civil Rights-era March on Washington in 1963. Sharpton called DEI the “civil rights fight of our generation." He and other Black leaders have called for boycotting American retailers that scaled backed policies and programs aimed at bolstering diversity and reducing discrimination in their ranks.
President Donald Trump's administration last month awarded a $1.2 billion contract to build and operate what's expected to become the nation’s largest immigration detention complex to a tiny Virginia firm with no experience running correction facilities.
Chipmaker Nvidia is poised to release a quarterly report that could provide a better sense of whether the stock market has been riding an overhyped artificial intelligence bubble or is being propelled by a technological boom that’s still gathering momentum.
Cracker Barrel said late Tuesday it’s returning to its old logo after critics — including President Donald Trump — protested the company’s plan to modernize.
Low-value imports are losing their duty-free status in the U.S. this week as part of President Donald Trump's agenda for making the nation less dependent on foreign goods. A widely used customs exemption for international shipments worth $800 or less is set to end starting on Friday. Trump already ended the “de minimis” rule for inexpensive items sent from China and Hong Kong, but having to pay import taxes on small parcels from everywhere else likely will be a big change for some small businesses and online shoppers. Purchases that previously entered the U.S. without needing to clear customs will be subject to the origin country’s tariff rate, which can range from 10% to 50%.
Southwest Airlines will soon require plus-size travelers to pay for an extra seat in advance if they can't fit within the armrests of one seat. This change is part of several updates the airline is making. The new rule starts on Jan. 27, the same day Southwest begins assigning seats. Currently, plus-size passengers can pay for an extra seat in advance and later get a refund, or request a free extra seat at the airport. Under the new policy, refunds are still possible but not guaranteed. Southwest said in a statement it is updating policies to prepare for assigned seating next year.
Cracker Barrel is sticking with its new logo. For now. But the chain is also apologizing to fans who were angered when the change was announced last week.
Elon Musk on Monday targeted Apple and OpenAI in an antitrust lawsuit alleging that the iPhone maker and the ChatGPT maker are teaming up to thwart competition in artificial intelligence.
