In the aftermath of the GameStop short squeeze, Rep. Maxine Waters (D-CA), the chairwoman of the House Financial Services Committee, says that Congress has concerns about the use of social media in financial trades and that it intends to investigate the amateur investors on Reddit's WallStreetBets community.
The effort to topple hedge funds involved in shorting GameStop and AMC stock, among others, garnered widespread support from numerous high-profile tech and social media personalities including Barstool Sports' Dave Portnoy and the tech youtuber Linus Sebastian aka LinusTechTips.
"Well, of course we have to put some, some, uh, concerns about technology and the speed at which certain, uh, entities, uh, have access to information quicker than anybody else can make quick decisions," said Waters in an interview on MSNBC on Thursday.
"They could be very profitable. Yeah, we're concerned. And we think that, uh, uh, technology certainly plays a role. In the way some of our entities operate and, uh, they, uh, put it in advantage, uh, by the way that they have access to the kind of resources that enable them, uh, to make decisions, to buy and sell quicker, uh, and to be on top of things before others, uh, can even know what's going on.
The interviewer asked: "What about free resources? Should people be able to use anonymous chat rooms? To pump up a stock to tell a story and not have to hold any accountability. On the other side, banks are highly regulated, but something like Reddit isn't we don't even know who those."
"No, we don't. And that's what we're going to find out," replied Waters.
"We're gonna find out. Uh, you know, we hear a lot about how it works. And, uh, what the different forms are that operate WallStreetBets is a forum that we are going to be focused on. This is where a lot of exchange of information goes on all the time, but we're going to ask the questions and we're going to dig into it," she said.
"And we got to find out exactly what was done and how it was done," Waters concluded.