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."
Memorial Day rang in the unofficial start of summer here in the United States -- and with it, the unofficial start of summer travel. Whether consumers traveled by air or by land, they probably experienced some form of frustration over the weekend. Flyers faced delays and cancellations, and drivers faced the most expensive gas prices ever recorded on Memorial Day. Zach Griff, Senior Aviation Reporter for the Points Guy, joins Cheddar News' Closing Bell to discuss.
Next-generation gaming ecosystem Joystick recently raised $8 million in a seed round and is in the process of raising a $110 million Series A funding round. Gaming ecosystems are a relatively new type of platform in the Web3 space, allowing users to maximize their play-to-earn gaming opportunities, exchange crypto-currencies, and sell their digital assets. Joystick says its platform is flipping the current model on its head by giving players the opportunity to keep 100% of the revenue they earn. Robin Defay, co-founder and CEO of Joystick, and Michael Le, co-founder of Joystick and TikTok content creator, join Cheddar News' Closing Bell to discuss.
Abe Stein, Head of Innovation at Sports Innovation Lab, joins Cheddar News' Closing Bell, where he explains why the top four spots on his company's 2022 list are European soccer clubs and discusses Sports Innovation Lab's plan to publish data on women's pro sports teams in the not-too-distant future.
Joel Birch, Co-Founder and CEO of Stacked, joins Cheddar News' Closing Bell, where he explains why he doesn't see any new catalysts that would lead to a Bitcoin rally at the moment. He also reiterates that now is a good time for long-term Bitcoin investors to buy low.
The dating app Bumble has sponsored bills and pushed lawmakers to criminalize the online practice of sending unsolicited nudes or “cyberflashing." Payton Iheme, Bumble's head of public policy for the Americas, joined Cheddar News to discuss why the app was going after the harassing behavior beyond its own platform. "Now, while we went to work internally in the company, and we created something called private detector to automatically blur those images so the user can decide if they want to see them, there's nothing for the rest of the internet," she said. "And so that's why we went to work with these laws."
The holiday weekend saw Disney+ and Netflix competing head-to-head for streaming views as the Disney behemoth kicked off the unofficial start to summer with its release of "Obi-Wan Kenobi" and Netflix responded with the first part of "Stranger Things" Season 4. The streaming giants caught the eye of Wall Street, and Seth Schachner, the managing director at consultancy Strat Americas, joined Cheddar News to break down the heavy hitters. "This is a very tough, competitive game, and I don't see it getting any easier," he said. "I think you'll probably see more consolidation."
Amid high inflation, shoppers are pinching their pennies in the grocery stores and becoming more frugal when food shopping. However, supermarkets like Kroger are pushing back against passing on the higher costs and demanding reasons for the higher food prices from suppliers.
The founder and president of Cyborg Mobile Kobie Hatcher has been on a strong trajectory to disrupt his industry with a program called The New Technologists. It's not only meant to address the diversity gap within large tech companies but also help pave the way to transform the lives of young BIPOC students. He joined Cheddar News to talk about how he's working to make a difference with the lack of diversity in tech. “There's truly no lack of talent out there. It's just identifying them and letting them know that, hey, I've been in the tech sector for over 20 years. I see you. I know what you can bring, bring it, we need it," Hatcher said.
