So it kind of sounds like the same systemic flaws in our "too big to fail" financial system that were there back in 2008 are still there. (Can you say "liquidity"?) And it's rare that Wall Street is so desperate, they'll come right out and demonstrate the rigged nature of the game.
Yesterday, Merrill Lynch, Robinhood, and Ameritrade all stopped customers from buying GameStop and AMC shares yesterday -- although you were allowed to sell. This morning, they've cautiously allowed extremely limited trading to resume (if you own less than five GameStop shares).
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And as happens whenever Reddit is involved, rumors were flying and their day traders were practically hysterical. Upon learning that SEC enforcement was rumored to be asking Robinhood for customer trading data, social media lit up with "they're coming for us!" But from what I can tell, the concern is over the huge amounts of money the institutional investors moved into the Reddit stocks.
It was also a big shock to some Robinhood users to get messages that shares of the stock they were holding onto were sold without their agreement to stabilize the market. (A dig into the fine print shows they reserve that right. Not necessarily a bad thing, under some circumstances. But was this really a case of market stability -- or Robinhood cashflow issues?)
For what it's worth, I don't see this happening. Too much public outrage at prosecuting day traders for what hedge funds do all the time. And certainly, politicians feel the same way:
Much more to come, I assume. Hopefully it results in some ordinary people getting some degree of financial security out of all this drama.
