White House press secretary Jen Psaki answers reporters’ questions about Janet Yellen and the increase in GameStop shares.
Treasury Secretary Janet Yellen said on Thursday that her meeting with key federal regulators this morning will focus on whether recent market volatility, driven by an army of renegade traders snapping up shares of GameStop and other heavily sold companies, justifies “additional actions”
“We need to understand deeply what happened before we took action, but we are certainly looking carefully at these events,” said Yellen during an interview on ABC’s “Good Morning America” program.
GAMESTOP NAYSAYERS SEE PURCHASE STOCK WITH $ 6B LOSSES
Yellen called a meeting with the heads of the Securities and Exchange Commission, the Federal Reserve, the Federal Reserve Bank of New York and the Commodity Futures Trading Commission after days of big fluctuations in GameStop, AMC Entertainment and other favored shares on the Reddit forum ” Wallstreetbets. “
GameStop shares, which were around $ 19 in early January, rose to $ 483 and fell to $ 61 last week, a price rise so dramatic that TD Ameritrade and Robinhood temporarily placed restrictions on negotiation of the traditional video game reseller. The stock price continued to spin this week, closing above $ 200 on Monday, but dropping to less than $ 100 during Thursday’s trading.
INCREASING INTEREST RATES MEANS PROBLEMS FOR SHARES
| Ticker | Safety | Last | change | Change % |
|---|---|---|---|---|
| GME | GAMESTOP CORP | 67.37 | -25.40 | -27.38% |
“We really need to make sure that our financial markets are functioning properly and efficiently and that investors are protected,” said Yellen. “We will discuss these recent events and discuss whether or not recent events warrant further action.”
The madness escalated after local brokers put their support on the stock, betting that stock prices would rise even if Wall Street short sellers bet exactly the opposite. Short sellers – who bet on falling stocks by selling stocks they don’t own – lost billions.
But movements reverberated across the market last week, with major indices falling on Friday. Analysts say losses to major investors who have sold shares are forcing them to sell other shares to raise money.
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The stock market roller coaster, seen by many as a 99% war waged against wealthy Wall Street titans, has also raised questions among lawmakers across the political corridor about increased regulatory oversight and concerns about unprofessional investors who apparently were prevented from trading GameStop shares for a brief period.
Robinhood Financial, through which many of Reddit’s investors made their trades, said it cut back on trades due to a $ 3 billion demand to support the moves and hedge the risk. Critics accused the app of trying to protect Wall Street investors who shorted stocks.
“Secretary Yellen believes that market integrity is important and has called for a discussion of recent volatility in financial markets and whether recent activities are consistent with investor protection and fair and efficient markets,” said a Department of Finance spokeswoman. Alexandra LaMann treasury to FOX Business on Wednesday.