FAST FIVE: What The SEC Got Wrong In Its Meme Stock Report

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What The SEC Got Wrong In Its Meme Stock Report Late on Monday, the SEC released a watered down report suggesting popularized retail brokers lured investors to increase their trading via mechanisms like payment for order flow and gamified user interfaces.

The report comes after speculative commentaries on online social media fueled a price rise in shares of highly-shorted meme stocks, before the risk management of clearing agencies resulted in brokers imposing synthetic supply imbalances.

Moreover, the report found that the “act of rebellion,” on the part of retail market participants, did not result in markedly high amounts of short-covering by institutions.

Additionally, the report found that the price rise was “not consistent with a gamma squeeze.” Well, in keeping with the SEC's abysmal track record of publishing catastrophically wrong post hoc “analysis” – like finding that the entire May 2010 Flash Crash the work of one solitary basement-dwelling spoos trader, Nav Sarao – the agency best known for Sucking Elon's C**k has just unleashed another steaming pile of horseshit, and our friends at SpotGamma have fundamentally disagree with the report's conclusion that options were not a major catalyst to the aforementioned price rise.

The report concludes with the staff identifying areas of market structure and our regulatory framework for potential study and additional consideration.

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