Somehow fittingly, the Biden White House was pretty much mum on the GameStop controversy that has captured the nation’s attention.
A dramatic surge in trading volume brought about by a group of Reddit users resulted in the struggling retailer’s stock price skyrocketing. The coordinated effort to buy up Gamestop’s call options pushed the company’s stock prices into the stratosphere and crushed short-sellers in the process.
When asked about the controversy at Friday morning’s press briefing, White House press secretary Jen Psaki directed reporters to statements made by the Securities and Exchange Commission.
“They are closely monitoring this situation but it is under their purview at this point of time,” Psaki said — the issue comes up at the 35:45-minute mark in the video below.
Press Secretary Jen Psaki points to the SEC's statement in response to a question about GameStop trades this week https://t.co/5FqAZYPapU pic.twitter.com/bG1NC0etj8
— Bloomberg TV (@BloombergTV) January 29, 2021
CNN White House correspondent Kaitlan Collins asked: “Given all the volatility surrounding Wall Street and GameStop, what is the Biden administration doing to protect the average American investor if there’s going to be, potentially a major market correction?”
After Psaki referred her to the SEC statement saying the commission was “monitoring the on-going market volatility,” Collins followed up: “Beyond just monitoring it, has he had any conversations with economic officials about what’s going on?”
“He’s briefed by his economic team frequently,” Psaki said. “But I don’t have anything more to read out for you.”
A fitting tweet here from The Daily Caller’s Greg Price:
Imagine trying to explain Gamestop and Reddit to Joe Biden
— Greg Price (@greg_price11) January 27, 2021
As Fox News reported, GameStop stock rocketed from below $20 early Wednesday to close around $350. Thursday’s action “was even wilder,” the network said, as the stock swung between $112 and $483. And while it closed at $193.60, the frenzy resumed in the after hours trading with the stock up more than 50% and approaching $300 per share.
The trading app Robinhood and online broker Interactive Brokers would respond by restricting trading in certain securities.
When asked by Fox News White House correspondent Kristin Fisher if Biden will discuss the GameStop controversy with his economic team, Psaki replied that “it’s not the focus” of a planned meeting.
Reminded that it’s a “big story,” the president’s spokesperson shot back, “I know it’s a big story but our focus and our big story is getting the American people back to work.”
Reporter: Will Biden discuss Gamestop with econ team?
Psaki: “They’ll cover a range of topics during that meeting but it’s not the focus.”
Reporter: “It’s a big story.”
JP: “I know it’s a big story but our focus and our big story is getting the American people back to work.” pic.twitter.com/zyjzyPuK3s
— Forbes (@Forbes) January 29, 2021
The SEC, the nation’s top financial regulator, said Friday it is reviewing recent trading volatility that led to the meteoric rise in GameStop stocks.
In a statement, the SEC vowed to protect individual, retail traders and promised to scrutinize actions taken by brokerages that may “disadvantage investors or otherwise unduly inhibit their ability to trade certain securities,” NBC News reported.
“We will act to protect retail investors when the facts demonstrate abusive or manipulative trading activity that is prohibited by the federal securities laws,” the SEC said.
“The Commission is working closely with our regulatory partners, both across the government and at FINRA and other self-regulatory organizations, including the stock exchanges, to ensure that regulated entities uphold their obligations to protect investors and to identify and pursue potential wrongdoing,” the statement added.
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