January 28, 2021 9:49 am
Categories: Economy JoshWho News The Bongino Report

robinhood app begins restricting certain trades amidst market mania

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After a wild ride on the stock market yesterday for GameStop and other Reddit-fueled investments, the Robinhood trading app has halted investing today for other options that the Reddit investing forum r/WallStreetBets has signaled they will be targeting next. TD Ameritrade and Schwab have also limited trading for those properties.

“…brokers took steps to restrict the trading in GameStop stock and options and other related securities. In some cases, investors would only we able to sell their positions and not open new ones,” CNBC reported, noting that both Robinhood and Interactive Brokers endeavoured to curb trading.

Trading for GameStop and other options were stopped in reaction to the volatility in the market spurred by amateur investors on Reddit. This led many to question the notion that the stock market is a “free market” at all.

In a statement, Robinhood said, “We continuously monitor the markets and make changes where necessary. In light of recent volatility, we are restricting transactions for certain securities to position closing only, including $AMC, $BB, $BBBY, $EXPR, $GME, $KOSS, $NAKD and $NOK. We also raised margin requirements for certain securities.”

Dave Portnoy tweeted “And it turns out @RobinhoodApp is the biggest frauds of them all. ‘Democratizing finance for all’ except when we manipulate the market cause too many ordinary people are getting rich”

Robinhood halted sales for GME, which are the shares in GameStop, and then halted trading for AMC Entertainment as well, as AMC Entertainment was up next for the Reddit group of independent investors. Nokia stock is also looking at volatility in the market.

Investing apps, social media platform Discord, and the NASDAQ, have all rallied around the larger, more establishment investment firms, seemingly against the little guy. The big money is protected, while the small investor is being locked out. The reason would be that the large investment firms hold most of the money that fuels the market.

But the restrictions placed on small investors while the larger investors were allowed to continue their market manipulations brought out populists on both sides of the political aisle, and found them in agreement. As Portnoy noted, when Alexandria Ocasio-Cortez and Donald Trump Jr. are in agreement, it’s a pretty clear indication that something is wrong.

The money held in hedge funds and large investment funds is not simply the property of the wealthy. Many of the the funds were short selling GME and AMC are funds into which it’s likely that other small investors have placed their savings, often through pension funds.

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