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I'm really confused why the general public is enraged at the brokerages' decision to stop new buy orders for GME. It's very clear that retail is going to lose
by fairity 6y ago
I'm really confused why the general public is enraged at the brokerages' decision to stop new buy orders for GME.
It's very clear that retail is going to lose their shirts in the end of all of this. By blocking new buy orders, the brokerage is effectively protecting its naive clientele.
This isn't some government conspiracy. This is a firm trying its best to operate in the best interest of its clients.
- GVIrish 6y agoThe brokerage (Robinhood) is absolutely not protecting their clientele. If they were, they would've explained what they were doing when they did it or shortly thereafter. The silence is an indictment.
- fairity 6y agoMy guess is they are staying silent to avoid legal liability in the case that the run-up continues onwards in a significant manner.
- dathinab 6y agoI think the large majority of the cliente is fully aware that they will lose out on this long term. So it's not about protecting the client. If it would be about protecting your clients it would be like your care (=a utility) not allowing you to drive into the mountains for a hike (=user action) because the weather is bad (=makes action risky). I think no one would say that this is ok or acceptable, but if the utility is a broker and the action is buying stock on a high risk it is ok?
- fairity 6y agoI agree there are some retail traders who are going in with eyes wide open. However, due to the power of greed, a significant portion is not. And, the end result will be people losing their retirement income. So, the difference between your analogy is in the severity of the risk. Your car shouldn't let you drive into the mountains for a hike if it knows there's a 20% chance you're going to lose a limb that prevents you from living a happy life.