Skip to main content
Publish date:

Fury as trading platforms halt buys on GameStop, other 'meme stocks'

Trading app Robinhood is among those being slammed after a movement originating on Reddit drove up stock prices.
Author:

After a week that has seen the price of so-called "meme stocks" driven up by a determined community of Reddit users, a number of trading platforms hit back on Thursday by preventing people from buying shares in certain companies, including GameStop.

GameStop has been the poster child for the effort led by the Reddit group r/WallStreetBets, a collective of retail investors who have been driving up the prices of certain stocks, calling the bluff of hedge funds and institutional investors who have bet on the stocks decreasing in value – otherwise known as "shorting."

On Thursday, app-based trading platform Robinhood suspended purchases in GameStop (GME) and several other companies that had attracted investment from WallStreetBets including AMC, Blackberry (BB) Naked Brand Group (NAKD), Express (EXPR), Nokia (NOK), Koss (KOSS), and Sundial Growers (SNDL).

This meant that those holding the stocks could only sell them, not buy more, stymying efforts to increase their stock prices further, which is being interpreted as a concession to some of the institutional investors who stand to lose billions after "shorting" the companies, giving them an opportunity to limit their losses.

Several other brokers have suspended purchases in GameStop and some of the other "meme stocks," sparking consternation from commentators and apparently uniting politicians both left and right.

Progressive Democratic Rep. Alexandria Ocasio-Cortez, Donald Trump Jr., and under-fire U.S. Sen. Ted Cruz are among those who have criticized Robinhood for the decision to suspend purchases in GameStop and other stocks, arguing it is siding with Wall Street over American consumers.

If you want a decent explainer on what has happened with GameStop and how it is causing consternation in Wall Street, read this guide from Vice.

The decision by Robinhood to suspend trading is proving particularly ironic considering it describes itself as "democratizing finance for all."

This tweet from 2016 is now being shared liberally, while #deleterobinhood is trending.

Next Up

Chris Finch

Hawks bury Timberwolves in 3-point barrage

Without D'Angelo Russell, the Wolves couldn't keep up with the Hawks.

P.J. Fleck, Gophers football

Kirk Ciarocca returning to Gophers as offensive coordinator

The architect of the 2019 offense will look to revive the Gophers.

Klobuchar - MTP - NBC screengrab

Klobuchar says Congress should pass law to protect abortion rights

Her comments came as the Supreme Court appears poised to weaken — or gut — Roe v. Wade

MPD missing Heard - crop 1_

Police ask for public's help finding Mpls. woman missing a week

The 36-year-old hasn't been seen or heard from recently.

unsplash cold winter breath dark

Hello, winter: List of the coldest wind chills in MN Monday morning

The state went from a relatively mild start of the season, to downright frigid wind chills.

deer

1 CWD-positive deer in Brainerd Lakes area, so surveillance will continue

The CWD monitoring measures were supposed to end after this year.

unsplash - visitor patient doctor hospital emergency - crop

MN program will train, hire 1,000 nursing assistants for long-term care

The facilities are facing a severe staffing shortage.

Minnesota State Fair - main gate day 2021

Minnesota State Fair reestablishes a police department

The fair had been contracting with the Ramsey County Sheriff's Office.

teacher, covid, masks, school

Minnetonka to consider removing middle school mask requirement

The school board has been impressed by vaccination rates among middle school students.

snow, plow

Friday winter storm could hit Twin Cities, southern Minnesota

Meteorologist Sven Sundgaard is already monitoring the forecast.

Sauk Rapids Middle School street view, Minnesota - November 2018_

Teen student arrested for threats toward MN middle school

The Sauk Rapids middle school and high school were closed Monday.

_DSC0318

Rally for trans child outed during Hastings school board race draws big crowd

Hastings has been in the spotlight since the child's family was featured in a CNN story.

Related

Stock market chart

Global stock markets plunge on oil crash, coronavirus spread

It's expected to be one of the worst days on the stock market since the financial crisis.

Sorry, millennials, it's harder than ever to buy a home in the Twin Cities

Final sale prices have now risen for 64 consecutive months

Best Buy's CEO made $16.7 million last year

Half of the total trousered by Hubert Joly was in Best Buy stock.

sun country

Sun Country is going public, will list its stock on the Nasdaq

The airline is looking to raise cash through an IPO.

Bremer bank

St. Paul's Bremer Bank could be sold amid internal split

The trust that controls it can't agree on a strategy with the bank's board.

Best Buy confounds expectations with huge rise in sales

But it's not all good news for the Richfield retail giant.

Nate Schimelpfenig

Customer still getting charged for using the Minneapolis Super Bowl zipline

There have been numerous complaints made about the company involved.