[koheripbal]

Very likely is that the SEC is making phone calls to the big trading firms. Firms don't restrict transactions like this much voluntarily.

They are going to call the Reddit CEO and have wsb shut down under the threat of SEC enforcement actions.

Looks like the wsb discord is down.

[jimbob45]

Same stuff goes down on 4chan and several other sites. Not to mention the fact that the SEC has neglected to investigate insider trading for years now.

IMHO why the fuck is shorting legal to begin with. Short insurance should be mandatory for short trading.

[koheripbal]

> the fact that the SEC has neglected to investigate insider trading for years now.

Obviously false: https://secsearch.sec.gov/search/docs?utf8=%E2%9C%93&affilia...

> 4chan and several other sites...

Scale dictates enforcement priorities, obviously. Like a lot of people, they don't deal with issues until they are large and impact the market. They are ABSOLUTELY going to intervene here. First with some immediate action, and later they'll craft a new rule to guide social media on stock advice being not allowed on their platforms (IMO).

> why the f** is shorting legal

Short selling rewards investors who believe that certain stocks are overvalued or that the company is covering up fraud. They helped bring Lehman Brothers down, as well as Enron, Wirecard, etc... In those instances, the shorts were instrumental in reverting stocks down to correct (sometimes zero) prices. Without them, bubbles would rise higher and poop much bigger. That sort of volatility destroys liquidity and confidence in the market.

> Short insurance should be mandatory for short trading.

There are naked short limits already, but yeah, this issue with GameStop should have those rules re-evaluated, because they obviously didn't work in this case.

[mrec]

> bubbles would rise higher and poop much bigger

Please don't fix this, it's perfect.

[jcfrei]

> They are ABSOLUTELY going to intervene here.

I wouldn't be so certain about this at all. Matt Levine has a good take on it: https://www.bloomberg.com/news/newsletters/2021-01-26/will-w...

[tony101]

> "First with some immediate action, and later they'll craft a new rule to guide social media on stock advice being not allowed on their platforms (IMO)."

What about Section 230?

[bilegeek]

Well, the IRS doesn't go after rich people because they don't have the funding[1]; they only go after the people they can afford to go after[2].

I know the IRS is different from the SEC, Apples to Oranges. But like you said, they've neglected insider trading; it's probably for very similar reasons, because those being investigated just have too much power to take down. I'm sure the SEC will hammer these easy targets on WSB well before they even dare touch the Big Boys.

[1]https://www.nytimes.com/2019/05/03/sunday-review/tax-rich-ir...

[2]https://www.propublica.org/article/earned-income-tax-credit-...

[koheripbal]

If you look at the SEC website, they list all their current complaints filed against people for Insider Trading.

There are many [1].

[1] https://secsearch.sec.gov/search/docs?utf8=%E2%9C%93&affilia...

[boringg]

SEC got neutered when the previous US administration got into power. The administration before that was actively pursuing cases.

[koheripbal]

False: https://secsearch.sec.gov/search/docs?utf8=%E2%9C%93&affilia...

[boringg]

True: https://wp.nyu.edu/compliance_enforcement/2017/10/09/trump-v...

[koheripbal]

No - false. They cherry picked a data window...

> January 2016 through the end of the SEC fiscal year on September 30, 2017

If you look at the followup data, you can see both administrations are similar...

https://www.law.nyu.edu/sites/default/files/Fig3-SEEDNov2020...

...and then if you actually read my above link, you'd see numerous Insider Trading prosecutions (which was the original false claim made above).

[TuringNYC]

Could you note any major cases the previous administration pursued that didn't involve some lone scapegoat trader and/or a minority everyone could agree to dislike? Were there any actual cases after the 2008 mortgage/cdo/cds crisis, for example?

[TuringNYC]

Prediction: SEC will go after one or two retail traders who are minorities and blame the entire episode on their probably harmless tweet or post.

[sayhar]

I don't know why you're being voted down here. These are legitimate articles in major publications that are broadly accepted by experts in the field. Sad!