The White House is staying out of the GameStop controversy.
Asked about the market volatility during Friday morning’s press briefing, White House press secretary Jen Psaki punted on the question and directed reporters to statements by the Securities and Exchange Commission.
“They are closely monitoring this situation but it is under their purview at this point of time,” Psaki said, declining to speak specifically about the situation.
It came a day after Psaki — during Thursday’s briefing — also refused to answer directly about the contoversy. The chaos started when a Reddit group called WallStreetBets banded together to squeeze short-sellers out of their positions by buying up stock in video game retailer GameStop and other flailing companies.
The Reddit group temporarily went private. Trading app Robinhood and online broker Interactive Brokers restricted trading in certain securities because of the recent volatility in a number of stocks, igniting controversy.
YELLEN RECEIVED $800G FROM HEDGE FUND IN GAMESTOP CONTROVERSY, WH DOESN’T COMMIT TO RECUSAL
“Given all the volatility surrounding Wall Street and GameStop, what is the Biden administration doing to protect the average American investor if there’s going to be, potentially a major market correction?” a reporter asked.
Psaki referred her to an SEC statement, which said the commission was “monitoring the on-going market volatility.”
“Beyond just monitoring it, has he had any conversations with economic officials about what’s going on?” the reporter pressed.
“He’s briefed by his economic team frequently,” Psaki said. “But I don’t have anything more to read out for you.”
Psaki again pointed to the SEC statement when another correspondent addressed the controversy.
SURGING GAMESTOP STOCK CREATING CHAOS FOR HEDGE FUNDS
A third reporter asked Psaki if Treasury Secretary Janet Yellen would recuse herself from advising the president on GameStop, given that she received around $810,000 in speaking fees from Citadel, the hedge fund that bailed out one of the primary losers in the Gamestop frenzy.
Both Citadel and Point72 infused almost $3 billion into Melvin Capital, which saw massive losses after betting against the pumped up stock. The White House said on Wednesday that Yellen was monitoring the situation.
GameStop stock has rocketed from below $20 earlier to close around $350 Wednesday. The action was even wilder Thursday: The stock swung between $112 and $483. The stock closed at $193.60, down more than 44% — however in after hours trading the frenzy resumed with the stock up more than 50% and approaching $300 per share. — via Sean Tyler Chan / AdChoiceTV News