Hedge fund anger in the US: It could get uncomfortable for speculators - Biden on alert

2021-01-30T17:50:13.924Z

The excitement over the extreme volatility of shares in the video game retailer Gamestop and other companies in the US financial market has reached the highest political level. Will there be a change?

The excitement over the extreme volatility of shares in the video game retailer Gamestop and other companies in the US financial market has reached the highest political level.

Will there be a change?

A modern fairy tale is taking place in the USA:

small investors
successfully defend themselves against

large investors
.
The roller coaster ride of the

Gamestop share
brings the American financial market upset.
The debate has reached a

political level
- the business practices of

hedge funds have
come under fire.
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Washington / New York - In the USA, the stock exchange is coming under fire: The future chairman of the banking committee in the US Senate, Sherrod Brown, announced a hearing "on the current state of the stock market".

It was time for the

SEC

and Congress to make the

economy work

for everyone, not just

Wall Street

"The people on Wall Street only care about the rules when they're the one who hurts," Brown's statement said.

Gamestop share: Fight David against Goliath - hedge fund machinations under fire

The background to this is the great annoyance of investors about restrictions on trading in papers from

Gamestop

and other companies, through which they see themselves slowed down in the event of a profit.

The

online broker Robinhood in

particular

came under massive criticism and suspected that it was

discriminating

against small investors compared to

large Wall Street investors

At companies such as

Gamestop

or the cinema chain

AMC

, hedge funds have recently lost a lot of money by betting on falling prices, among other things because hobby traders joined forces in online forums and stocks * of various companies successfully increased:

The fact that

Robinhood

restricted the trade in the papers so that they can only be sold but no longer bought is now a

political issue

and has

triggered

debate about regulation

According to the US media, the chairman of the finance committee in the US House of Representatives, Maxine Waters, is planning a hearing.

It will deal with the latest

turbulence in the financial market

and the role of hedge funds in general.

Other high-ranking Democratic politicians are calling for clarification.

The new US President Joe Biden * said that his administration is closely monitoring what is happening in New York.

Representatives of the Republican Party also expressed incomprehension for

Robinhood's decision

Gamestop share on Wall Street: Robinhood in need of explanation - Tesla boss intervenes

After the storm of outrage and the first complaints from investors who see themselves being driven out of price gains, Robinhood announced in the evening that

it would relax

the

trading restrictions on the securities

again.

The shares of Gamestop then rose in after-hours trading by over 70 percent, those of AMC by almost 50 percent.

The papers of other companies, such as the smartphone pioneer

Blackberry

, for which restrictions also applied, also grew strongly.

Robinhood boss Vlad Tenev told the US financial broadcaster

CNBC

that the trade restrictions had been decided to protect his own company and its customers.

Even