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Yes, I am 100% assuming that Robinhood is acting is "good faith" (the fact that I'm defending Robinhood feels gross to me). If Robinhood just wanted to make mo
by nrmitchi 6y ago
Yes, I am 100% assuming that Robinhood is acting is "good faith" (the fact that I'm defending Robinhood feels gross to me).
If Robinhood just wanted to make money, they would have let this continue. People like to complain that RH gets payment for order flow, but they just knowingly cut off that order flow.
It feels like Occam's Razor should apply here. Either:
1. Robinhood felt that it's long term prospects were better if it's users weren't able to gamble and most likely lose all of their money, thus being scared away from the stock market forever.
2. There is a secret cobal that Robinhood, who was previous the "bad guy" of the financial world, is now in and tricked it's users into buying a stock that would be worthless just so that Robinhood could shut of trading at the peak, and let their secret hedge-fund buddies make a ton of money.
I'm not inclined to believe the conspiracy theory when there is a more more reasonable option.
- unethical_ban 6y agoThe same firm, Citadel, that fills much of RH's orders is the firm that propped up Melvin Capital (the group that shorted GME and needed a bailout). Option 3: The cabal is there, it isn't secret, and they were on the hook to lose so much money that it was cheaper to essentially sacrifice the RH brand than to let the short get fucked to infinity. Edit: They have stated on a blog post that this was a risk management move on their part - not strictly in the interest of the customer. The market is broken.