I know RobinHood messed up here. But... they never had a good reputation to begin with. Its an open secret that RobinHood's entire setup is kind of crap.
My understanding is TD Ameritrade is only blocking the purchase of stock on margin. If you have the cash, you're allowed to make the purchase.
The lender. As in all loans. As is in every detail described in one’s margin contract.
That may explain why they had to block trading in the stock. Margin losses almost inevitable at this point. But legal said they couldn't block lending on a single name. Their TOS, however, permit them to suspend trading in single names.
For example, with InteractiveBrokers "long stock positions [of AMC, BB, EXPR, GME, and KOSS] will require 100% margin and short stock positions will require 300% margin until further notice".
The context of this subthread is this message https://news.ycombinator.com/item?id=25942677 about brokers allowing the buying of GME but not on margin (and how they don't have to disallow the use of margin for every stock for that).
Robinhood isn't the only investment platform that allows trades on NYSE obviously. Evidently though, it had the highest volume when it comes to GME it seems.
I was at the gym yesterday and heard like 5 people talking about stocks: gme, amc, bb. Everyone is trying to get in on this and they're trying to stop it. They bogged gme at open to scare people and now it's back up. If they didn't remove the option for users to buy they surely would have bought the dip.
Keep in mind that this is very likely a zero-sum game. At some point the bubble will pop, and as many people as gained money on the way up will lose money on the way down.
GME has now become a $25B hedge fund with a gaming focus. They absolutely have the ability to become long term successful given these black swans they just experienced.
Now, I know *nothing* about their management, but they at least have been given a chance. Their's an Eminem song that they should be playing throughout their buildings right now. If I were them I'd sell more shares, pay down any bad debt, and invest in 10-100 of the best black swan ideas of my rank and file and see what happens.
I think you're confusing their market cap with their balance sheet. A $25B hedge fund has $25B in assets, but a $25B market cap does not mean that they have access to anywhere near that amount of capital.
Sure, maybe they could issue a dilutive follow-on offering and bring in some cash, but who knows where the stock price will be by the time they get through the paperwork on that. And they're currently losing about half a billion per year on about $6B in revenue, so I'm not sure that an extra billion or so in cash is going to fundamentally remake the company....
Didn't know about the $500M lost on $6B in revenue, but gaming is a growing market, they just got a ton of free advertising, so seems like they have a chance to do something great.
$GME is up 11% as of the writing of this post. Who is buying it?
This is actually making me angry to watch.
-edit-
I had like one share - Robinhood just sold my shares without me ordering it. Dunno what happened there.