GameStop frenzy prompts Yellen to call meeting with SEC, Fed
Treasury Secretary Janet Yellen will meet with key financial regulatory agencies to scrutinize recent price surges in GameStop stock and other companies, the latest move by policymakers to respond to market maneuvers tied to a group of investors on Reddit.
The meeting, which will take place as soon as Thursday, will focus on findings from the Securities and Exchange Commission, according to a Treasury official. It will also include the Federal Reserve, the New York Fed and the Commodity Futures Trading Commission, which oversees derivatives.
“Secretary Yellen believes the integrity of markets is important and has asked for a discussion of recent volatility in financial markets and whether recent activities are consistent with investor protection and fair and efficient markets,” the department said in a statement.
The frenzy in a range of stocks has increasingly drawn in policymakers, particularly after brokerage Robinhood Financial suddenly limited trading in GameStop, AMC Entertainment and other stocks, citing demands from a clearinghouse for $3 billion to back up trades as it continued to rack up purchase orders from its customers.
In addition to the volatility that has hit shares in GameStop, AMC and other struggling companies, the CFTC has also said it is keeping an eye on derivatives trading in silver, as prices for the precious metal have soared in recent days.
Some believe the rally was started by a Reddit post from last week that called for users to start buying silver in an effort to increase the price, which moderators later deleted.
However, others on the website have disputed the community's involvement and called investment in silver a "scam." Another recent post called attributing movements in silver to the online group a "hedge-fund coordinated attack."
