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Maxine Waters is planning to call multiple hearings on the GameStop frenzy

February 18, 2021. Summarized by summa-bot.

Compression ratio: 58.4%. 1 min read.

WASHINGTON, DC - DECEMBER 02: House Financial Services Committee Chairwoman U.S. Rep. Maxine Waters (D-CA) arrives for a House Financial Services Committee oversight hearing to discuss the Treasury Department's and Federal Reserve's response to the coronavirus (COVID-19) pandemic on December 02, 2020 in Washington, DC. Federal Reserve Chairman Jerome Powell and Treasury Secretary Steven Mnuchin are scheduled to testify.

Congresswoman Maxine Waters plans to thoroughly investigate the GameStop trading frenzy by holding multiple hearings on the matter.

New York (CNN Business)Congresswoman Maxine Waters plans to thoroughly investigate the GameStop trading frenzy by holding multiple hearings on the matter.

Waters, the chairwoman of the powerful House Financial Services Committee, told CNN Business she will likely hold three hearings, with the first one occurring Thursday.

Subsequent hearings could focus on expert testimony and potential legislation, Waters said.

Waters, a Democrat from California, sees Thursday's hearing as "informational," focused on identifying what actions were taken and by whom.

The virtual hearing will feature testimony from Robinhood CEO Vlad Tenev, hedge fund billionaire Ken Griffin of Citadel, Reddit CEO Steve Huffman and Melvin Capital CEO Gabriel Plotkin.

The GameStop trading frenzy shined a bright light on the free trading boom set off by Robinhood, the role of high-speed trading firms like Griffin's Citadel Securities and the populist angst at the heart of the Reddit mob.

In a second hearing, Waters said she plans to bring in experts, including from Wall Street's self-regulator, who can talk about the role of hedge funds and the democratization of trading.

A third hearing would likely be focused on potential legislation, although Waters declined to pre-judge what new laws might be required.

"I don't come with any foregone conclusions," Waters said.

Potential legislative fixes that have been floated include outlawing payment for order flow, the controversial practice in which brokers like Robinhood route retail trades to high-speed trading firms such as Citadel Securities.

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