President Joe Biden’s top economic advisers expressed confidence in US market regulators, with one saying that they should be less concerned with speculation and volatility than with ensuring that the “underlying pipeline” is solid.
This is the job of the United States Securities and Exchange Commission “and if you read their statements, you will see that they are very involved in this case,” said Jared Bernstein, a member of the Biden Council of Economic Advisers, in “Fox News Domigo.”
His comments follow a week of Wall Street frenzy centered on the video game retailer GameStop Corp. that burned hedge funds and calls from some Democrats, including Senator Elizabeth Warren, for the SEC to address market manipulation.
“What’s going on with GameStop is just a reminder of what’s been going on on Wall Street for years and years and years,” Warren said on Sunday on CNN’s State of the Union. “It’s time for the SEC to get out of it and do its job.”
The SEC is operating under the leadership of interim President Allison Herren Lee, while Biden awaits confirmation from Gary Gensler’s Senate, his choice to lead the agency.
“The president’s main concern is that the responsible regulator, the Securities and Exchange Commission, has to ensure that there is no volatility and speculation in the market – that is a constant – but that the underlying pipeline of the financial markets remains sound,” he said. Bernstein.
Read more: Gensler confirmation nowhere in sight while GameStop tests the SEC function
The SEC said on Friday that it is “closely monitoring the extreme volatility of trading prices for certain stocks in the past few days” and analyzing “actions taken by regulated entities that could harm investors or unduly inhibit their ability to trade certain securities” .
Last week, lawmakers on both sides questioned why platforms like Robinhood Markets Inc. restricted trade for some of the companies whose stock prices soared after being posted on social media.
Read more: GameStop Short Nightmare shows some signs of becoming contagious
Brian Deese, head of the Biden National Economic Council, said that stock swings last week are “being properly investigated” by the SEC with “a real focus on protecting retail investors and market integrity”.
He suggested that the government could seek to expand its monitoring, saying “we will look closely at the broader political issues associated with the stock markets”.
The chairmen of two House and Senate commissions pledged last week hold hearings on recent stock market swings, but no date has been announced.