Senate panel to hold hearing amid GameStop frenzy

People walk by a GameStop store in Brooklyn on Jan 28, 2021 in New York City.
People walk by a GameStop store in Brooklyn on Jan 28, 2021 in New York City.PHOTO: AFP

WASHINGTON (BLOOMBERG) - The Senate Banking Committee will hold a hearing on "the current state of the stock market," incoming chairman Sherrod Brown said on Thursday (Jan 28), as a growing number of lawmakers criticised moves to curb Reddit-fuelled trades in companies like GameStop.

"People on Wall Street only care about the rules when they're the ones getting hurt. American workers have known for years the Wall Street system is broken - they've been paying the price," Brown said in a statement.

"It's time for the SEC and Congress to make the economy work for everyone, not just Wall Street."

While Brown did not announce a date for the hearing, a rare bipartisan collection of lawmakers joined in criticising platforms like Robinhood Markets for limiting trading in some stocks, saying it unfairly disadvantages regular people who should be allowed to trade as freely as hedge funds.

Progressives including Representative Alexandria Ocasio-Cortez and Senator Elizabeth Warren, as well as Senate Banking Republican Pat Toomey said the moves merit closer regulatory scrutiny.

House Speaker Nancy Pelosi called trades "interesting", and said the relevant agencies should examine the issue.

Toomey, who is poised to become the top Republican on the Senate Banking Committee, said he is disturbed by Robinhood and other platforms blocking trades.

"I find it very disturbing that a platform would suddenly freeze out investors," Toomey said.

"People should be free to make the investment decisions they choose."