WASHINGTON (AP) — The drama surrounding the trading in shares of GameStop, AMC Entertainment, Blackberry and other beaten-down companies has suddenly thrust Wall Street near the top of a crowded list of issues that President Joe Biden's regulatory team needs to tackle early in its term.
A number of wealthy institutions on Wall Street bet the stocks of these companies would fall, only to be thwarted by small investors who banded together on social media and sent the prices higher. Many of the small investors trade on online platforms such as Robinhood, which suddenly restricted the buying of shares of GameStop and other companies, sparking outrage from the social media crowd and politicians alike.
Biden's financial regulators — especially at the Securities and Exchange Commission — will likely have to address questions about a number of Wall Street practices, such as short-selling and whether the business model of online trading platforms is as investor-friendly as the companies say it is. The airing of complex issues will come in addition to anticipated efforts by regulators at the SEC, the Consumer Financial Protection Bureau and other agencies to overturn Trump-era rules deemed more favorable to the financial industry than to consumers or retail investors.
