Sec. Galvin Calls For 30-Day Suspension Of GameStop Stock Trading

BOSTON (WBZ NewsRadio) — Secretary of the Commonwealth Bill Galvin is calling for the New York Stock Exchange to temporarily suspend trading in GameStop, after a group of Reddit users fueled a frenzy in the company's stock earlier this week.

At the end of 2020, GameStop's stock was valued at nearly $19 per share. As of Thursday morning, the stock briefly jumped to $469.42 per share, later decreasing to the $230-240 range by the afternoon.

"This is unreasonable, it's irrational, it's also undermining the integrity of the marketplace," Galvin said.

The jump in the share value for the video game retailer was partially fueled by the subreddit group "WallStreetBets." In response to the surge, TD Ameritrade and Robinhood both restricted trades for users on several stocks, including GameStop. The subreddit group was also temporarily locked.

Secretary Galvin said the issue is not just the danger to the market. He is warning that although investing in the stock seems to be a get rich quick play for investors, it's likely too good to be true.

“The problem here is a lot of small and unsophisticated investors who think they’re going to make out are not, they’re going to lose,” he said. Galvin's office is concerned about those smaller investors, including people in the Commonwealth, who will not be able to make up any losses that incur while trading.

Meanwhile Massachusetts Senator Elizabeth Warren released a statement on social media on Wednesday, taking aim at "wealthy investors" who are raising alarm at the stock's value increase.

"With stocks soaring while millions are out of work and struggling to pay bills, it's not news that the stock market doesn't reflect our actual economy," Warren said. "For years, the same hedge funds, private equity firms and wealthy investors dismayed by the GameStop trades have treated the stock market like their own personal casino while everyone else pays the price. It's long past time for the SEC and other financial regulators to wake up and do their jobs -- and with a new administration and Democrats running congress, I intend to make sure they do."

Galvin said the frenzied movement in the stock "demands" that the NYSE take action, by suspending trading in the company for 30 days, or another extended period of time.

WBZ NewsRadio's Jeff Brown (@JeffBrownWBZ) reports.

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(Photo: Getty Images)

Written by Rachel Armany

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