The House Financial Services Committee hearing on Thursday on the GameStop trading frenzy threatens to be full of noise and bluster. The DealBook newsletter came up with questions lawmakers could ask the key players that might elicit the most illuminating responses.
Vlad Tenev of Robinhood
You’ve been lobbying for real-time settlement of stock trades, saying the current two-day delay led to Robinhood’s trading curbs. If there had been real-time settlement, would your brokerage firm have had enough capital to avoid restrictions at the height of the frenzy?
Robinhood says it offers retail investors free trading, but that’s because your company sells customer trades to market makers like Citadel Securities. Can you explain the benefit to firms that pay you to execute trades?
Brokerage firms lend their clients’ shares to short sellers. Would you consider asking Robinhood users to opt in to allow the lending of their holdings?
Ken Griffin of Citadel Securities
How is letting firms like Citadel Securities pay to execute retail customers’ orders good for mainstream investors?
Gabe Plotkin of Melvin Capital
How does allowing stocks in companies like GameStop to have short interest of more than 100 percent — that is, more of a company’s shares being sold short than are available to trade — make financial markets more efficient, as short sellers claim?
Jennifer Schulp of the Cato Institute
You say in your opening statement that the “unintended consequences” of regulatory changes in response to the meme-stock mania should not be underestimated. What are the consequences of not acting? Should investors expect episodes like the GameStop frenzy to become a regular feature of markets?
Steve Huffman of Reddit
You’ve said there wasn’t much your company could do to guard against market manipulation, but why shouldn’t your company be held liable if there is fraud on its platform?
Keith Gill, trader
Away from your persona as “Roaring Kitty” on YouTube, you were the director of financial wellness education at MassMutual. With your “financial wellness” hat on, what would have been the message you gave clients about investing in GameStop?
In your opening statement, you say you are “as bullish as I’ve ever been” about GameStop. What’s your price target?
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