interesting in his prepared remarks he makes a passing comment on citadel, instead focusing on citadelecurities which is a separate company that he also runs, but had more of a direct relationship with robinhood as it pays for their order flow so he'll focus on citadel securities and their roles in market maker and how that plays into the retail trading environment right now. >> his seat, leslie, may end up being one of the hottest today as that firm has faced criticism about what, if any, role they played in what robinhood ended up doing with curbing some of the trading to which mr. griffin has said in an interview, he called that completely absurd, a completely absurd theory he'll face a lot today from these lawmakers in washington. >> there were a lot of conspiracy theories floating around there, but it certainly raises the question about conflicts of interest that are embedded in this market structure that we see today. now with regard to citadel -- >> forgive me for interrupting you, leslie. i'll go to the hearing maxine water, the chair of the committee has now begun. >> and othe

citadel reached out to become a new investor. similar to investments others make in our funds, it was an opportunity for citadel to buy low and earn returns for its investors in and when the funds value went up. to be sure, melvin was managing, but we always had margin access and not seeking a cash infusion. i'm here to testify today i grew up in a middle class family in maine, went to a public high school. >> we are going to temporarily on live coverage of congress and you continue watching on c-span.org.

he has got citadel hedge fund, he has citadel securities. they are huge players on both sides. i think they will try to go at if there is any conflicts there, making money on one hand, benefited the other, there are supposed to be two separate companies. people, i know ken griffin, okay? i know him because i've covered him for years. i know citadel but it is not a household name like a steve cohen is. it may soon become a household name. i hear they will hold his feet to the fire. that will be interesting to see what he says. i don't remember him at many hearings in the past. this is a first for him. it will be interesting to see you who he deals -- neil: i will interresult you. i do want to dip in. robinhood ceo is now speaking here. we're trying to learn who, what, where, why, it happened it got a out of control for vlad tenev. let's listen in. >> mr. vlad, use your limited time to talk directly to what happened january 28th, your involvement in it? >> certainly. madam chair, madam chair, the witness has the opportunity to give their own testimony. >> you are not recognized,

but how could citadel know? it transacts directly with brokers and even if you stipulate that there has been a cost savings, it is unclear to me how much of the cost savings is being passed on to the retail investor, and how much of the cost savings is actually being pocketed by robinhood as profit. we know there is no commission at the front end, but what is the hidden cost of two investors at the back end of the transaction? can you give me clarity about the hidden cost? >> that is a very important question. in 2020, robinhood provided our customers in excess of $1 billion in price improvement. that price improvement is measured relative to the national best bid and best offer which is the reference price for all major exchanges. >> i ran out of time so i will yield back. >> madam chair? madam waters: we were having a technical problem. mr. taylor, you are recognized for five minutes. >> we'll point out that today and this week has been very hard for my home state of texas and my district in callan county -- c

griffin with citadel. when you do not pay as much for index funds or apple or anything like that, you're apt to me shows you are trying to encourage more trades, which puts more money in your pocket, not helping people build equity through smarter investing. i would ask two things. who exactly do you believe you are democratizing finance for and how do you plan to address these conflicts of interest? mr. tenev: i believe our business model has become the industry standard for a reason. it is because it is good for customers. it has led to the democratiz ation of the market. we are proud to market on uniform terms without taking into account any of the payments we generate from them in the routing. >> recognized for five minutes. thank you. >> thank you for holding today's hearing. i am concerned about investors in the state of wisconsin and across our country. to make sure they have access to the market, excess that is fair and equal to the big banks and hedge funds in wall street. we have seen improvement

citadel has been muddy for some time. citadel face hundred thousand dollars. 2017, 2.6 million. 2018, 2.5 million it seems like a lot of money it is to me. but over the same time, citadel has revenues generated in the amount of $13.2 billion it seems to me that the punishment for the improper trades, and it wasn't just trading center dot some other things. it seems that the punishment so small given the amount of revenue generated over the same time. it seems citadel has at least an opportunity to build into its cost of doing paying penalties. and that concerns me. it concerns me that the punishment does not seem to deter citadel. it deters me because i know of circumstances where persons who are not in the market do things that are much less harmful and they can go to jail. so the question i have is this. what kind of systems do we have in place to protect from the very things i have called attention to? ms. schlup: as a former enforcement attorney, i can say that regulators have the same concern with fines or other puni

citadel has been naughty for some time. 2012, pardon me, 2014, citadel faced $800,000 in penalties. 2017, 22 point $6 million. in 2018, 3 .5 million. 2020, 90 7 million. and another 2020, 700,000. this seems like a lot of money, it is for me, more than $124 million. but over the same time, citadel had revenues generated in the amount of 13.2 billion dollars. it seems to me that the punishment for the improper trade and improper actions, citadel also did some other things that were not proper. it seems that the punishment is so small given the amount of revenue generated for the same period it seems citadel has at least an opportunity to build into its cost of doing business, paying penalties. that concerns me. it concerns me that the punishment does not did seem to deter citadel. it concerns me because i know of circumstances where persons who are not in the market, they do things that are much less harmful and they can possibly go to jail. the question that i have is this- what kinds of systems do we have in place and back to you again, ma'am, to prevent the very things i have called to

griffin with citadel. when you do not pay as much for index funds or apple or anything like that, you're apt to me shows you are trying to encourage more trades, which puts more money in your pocket, not helping people build equity through smarter investing. i would ask two things. who exactly do you believe you are democratizing finance for and how do you plan to address these conflicts of interest? mr. tenev: i believe our business model has become the industry standard for a reason. it is because it is good for customers. it has led to the democratiz ation of the market. we are proud to market on uniform terms without taking into account any of the payments we generate from them in the routing. >> recognized for five minutes. thank you. >> thank you for holding today's hearing. i am concerned about investors in the state of wisconsin and across our country. to make sure they have access to the market, excess that is fair and equal to the big banks and hedge funds in wall street. we have seen improvement

it concerns me that the punishment doesn't seem to deter citadel. it concerns me because i know of circumstances where in persons who are not in the market, they do the things that are much less harmful and they can possibly go to jail. so the question that i have is this: what kinds of systems do we have in place and back to you again, ma'am, to prevent the very things that i have called to the attention of my colleagues >> well, as a former enforcement attorney at finra, i can say that regulators have the same concern with fines and other punishments becoming just a cost of doing business. and it's one of the things that are considered along with the rules and regulations allowed around what can be punished. >> the gentleman's time is up. >> may i, for the record mr. green, as you know, we are going to have a series of hearings and our next panel will include the whole bevy of experts also on some of these issues with that. >> may i say something in the record, please >> without objection, you may enter into the record, thank you. >> thank you >>

it is hard to know if that is true for citadel.on. they should point out canada, the united kingdom prohibit this whole arrangement, payment for order flow. they think it is too confusing t makes unclear what the real price is. so i'm not sure mr. griffin didn't answer the question. liz: we have got to run, do you think they are headed that way, there is too. of a conflict of interest they will ban the practice. >> i don't know if they ban it but at a minimum allow customers to on out in an easy way. they may require brokerages to pass on the payments they receive to their customers which is a thing they could do. liz: alexis goldstein, we'll have you back, thank you very much. we are coming right back. don't go away. much more straight ahead. ♪ it's not “pretty good or nothing.” it's not “acceptable or nothing.” and it's definitely not “close enough or nothing.” mercedes-benz suvs were engineered with only one mission in mind. to be the best. in the category, in the industry... in the world. lease the gla 250 suv for just $399 a m

you mentioned citadel. citadel has payment.iness model, the free trade concept works. it was 25 years ago chuck schwab said one day we're going to have no commissions in effect commissions have done nothing but go down over the last 25 to 30 years on wall street free trade is an incredible opportunity for any individual investor that wants to buy or sell stock or be involved in the market that's a plus. that's a plus. when you have an opportunity that really starts to go -- i mean, incredible as this particular trade was, there are regulatory requirements associated with that in order to handle them, you are much better off in terms of -- so free trade is nice, it's good, but it's not enough by itself you have to have another revenue stream you have to have a strong balance sheet. it's great to have assets under management all of those things matter the more separate revenue stream, the greater your balance sheet, more assets under management, the greater the brokerage firm is going to be able to handle increased margin require

you know i think that's not really the story at all the story here is that melvin capital and citadel had been selling counterfeit shares of game stop on the open market for cash they were engaged in a massive counterfeiting fraud and this set up a situation that made the game stock a potential candidate for what's called a short squeeze it was it was pointed out originally by michael berry the guy who gave us the big short back in 2008 this is called naked short selling by melvyn capital it's illegal and it disrupts price discovery and the regulators should have been regulating so what keith gill was involved with that the wall street bets crowd was they were doing something the regulator should have been doing for the several years now and that is stopping melvin capital associated with citadel capital who's got ben bernanke sitting on their board former fed chairman they were engaged in massive fraud as are so much of the hedge funds and players on wall street engaged in massive fraud on a daily basis they paid over $30000000000.00 of fines last year and what's come out in the test

ken griffin of citadel set a few years ago we had t+5, t+2. are we not at t+1 and how realistic that we get there on the path to real-time settlement? bradley: we should be. the reason that we are not is it's a failure of government. by definition, regulation always lags rent --innovation. it's always going to be a gap, and that is ok. but the gap cannot be indefinite or interminable. at a some point it is pretty protectable that as the markets are moving, if apps like robinhood are getting more popularity, people on reddit are paying more attention, you put all that together and clearly the rules that made sense five years ago even don't make sense today. the sec did not do a good job. we have a new administration and it is incumbent on them to step up. taylor: how does robinhood look coming out of this? bradley: obviously not great. to me, the fault for them wasn't so much that they did not anticipate this one thing happening. as you said in a cliff, it was a one in 3.5 million chance of this happening. but they market themselves literally i

citadel ceo ken griffin.ks from him s&p sectors that have lagged technology and health care the two biggest losers you're watching "squawk box" on cnbc so you're a small business, or a big one. you were thriving, but then... oh. ah. okay. plan, pivot. how do you bounce back? you don't, you bounce forward, with serious and reliable internet. powered by the largest gig speed network in america. but is it secure? sure it's secure. and even if the power goes down, your connection doesn't. so how do i do this? you don't do this. we do this, together. bounce forward, with comcast business. ready to shine from the inside out? try nature's bounty hair, skin and nails gummies. the number one brand to support beautiful hair, glowing skin, and healthy nails. and try advanced, now with two times more biotin. ♪ ooh la la by cherie ♪ and try advanced, it was the age of wisdom... ♪ ooh la la by cherie ♪ the moxie showerhead speaker. only from kohler. >>> "the game" stop saga taking center stage in washington we have highlig

you know, citadel's an interesting position here, eric.they've got the hedge fund, two totally separate things. what will you expect to hear from tomorrow? what do you need to hear? >> well, first of all, thank you, liz, for having me on. second of all, i just want to make clear whatever comments i make today, i do not represent finra. that just happens to be a public trust that i have. so my comments are only my own. liz: got it. >> i think what i'd be looking for from citadel and ken and the rest of the panelists are really an understanding of what drove their trading. but as you pointed out, the flow coming off of retail platforms like robinhood is primarily interacted with by firms like citadel, by other large market-making firms. there is no way from at least that side of the business they would have any desire or intention to shut that flow off. those are longstanding, lucrative business arrangements that i think they would not want to put at risk by doing anything untoward. liz: do you see it as a conflict of interest, eric? >> a co

you said that you didn't talk to anybody, citadel, citadel securities did anyone in your organization, since january 1st, contact robinhood? >> are you asking if we have had contact with robinhood -- >> with respect to -- with respect to game stop and what we are obviously talking about. >> so, congressman, we offered to have my colleague who manages that relationship be here today instead. he has firsthand knowledge we of course are talking to robinhood routinely in the ordinary course of business. we manage a substantial portion of their order flow. >> i understand that but did you talk to them about restricting or doing anything to prevent people from buying -- not selling, but buying stock in game stop? >> let me be -- >> anybody in your organization? >> let me be perfectly clear absolutely not >> so if we depose everyone in your organization, we will find that >> that is correct >> okay. thank you. i do want to ask with you thing. mr. sherman was pursuing that. how do you balance the best execution with your order flow for your franchise from robinhood for the need to profit from

citadel securities responded and said citadel securities has not instructed or otherwise caused any brokeraged or limit trading or otherwise refuse to do business and .72 called the allegations baseless writing it had no involvement in roib binhood's or any other -- joining me now are the two lawyers representing a total of 1,000 robinhood users in that class action lawsuit. jeff quanitz and sean burston. robinhood had an agreement that every customer must sign before they use the platform saying this in part, "i understand that robinhood may in its discretion prohibit or restrict the trading of securities or the substitution of securities in any of my accounts," that's the robinhood agreement that every customer signs. the sec bulletin, which the sec is no friend of robinhood or anyone else, it says the same thing. on what grounds are you fueling this suit, jeff? >> well, first of all, of course the sec is going to say that. >> why? >> we have a system that's designed for the 1% to take advantage of the 99%. after '87, after 2001, after 2008 everybody says that they learned. and they go and

theories because griffin owns two separate companies, citadel securities, the market maker and citadelund it was the latter that invested in melvin capital, a hedge fund that invested a short squeeze. gabe plotkin will say his short positions were not an effort to manipulate the price of a stock, brian. >> so this payment for order flow, okay, to your point, it's 545 in the morning, we're going to do this in layman's terms if something is free, free to trade on robinhood, and the company is worth billions, people think how in the world can he be worth billions when he seems to have no product the product is the trader. >> pfof is this just practice, not just limited to robinhood and citadel, there are lots of brokerages that do this. pretty much every has some payment for order flow system in place, and there are several market makers that also pay for this from citadel's standpoint, citadel will pay robinhood for the sake, for example, this morning to execute its trades. why that's helpful for citadel is they operate in a spread business so they are able to make money by executing tho

several of the brokers offer the order flows as a sale to the firm like citadel. however the price that robinhood gets for the order flow is much higher than any other brokers -- any other brokers receives i could go on and tell you we have pulled the s.e.c. filings that robinhood receives 17% per 100 shares stock of traded, and 58% to 100 shares, and i could go on. but question is, why do companies like citadel pay a premium for their order flows of robinhood's users? >> thank you, congresswoman, for that very important question there are several reasons that may be the case. one important one is that our model and formula for payment for order flow works a little bit differently. we actually receive payment for order flow as a percentage of the bid ask spread rather than on a per share basis and we do believe that that's the most optimal way to structure payment for order flow arrangements >> okay. it's not the -- is it not because companies like citadel can make more money off of robinhood users than others? and that's a yes or no, because my clock is going to

being a kid at the citadel is no easy feat. it was a big challenge academically and physically to go through. i loved every minute of it because the alumni network of the citadel is one giant family and i would not be where i am today, would not have achieved so much success in business and be here in congress, without the support of citadel alumni all across the country who have been cheering me on for many years. >> described the rigor? >> as an 18-year-old kid and you have to get up at 5 a.m. for duties and march every day and told when and where and how you have to be and how to act and behave and what you will eat. it was very rigorous. back in those days we were not allowed to have long flowing hair, no makeup, no nail polish, no any of that. back in those days, in the very first year for women, there was an attrition rate of 50%. 44 of us started out and 22 -- in 20 made it through the freshman year. i graduated at the top of my class. that was a tremendous challenge in my life, but it taught me the most important about

is capable of doing that isn't anything against citadel, it's just the realistic truth. liz: tyler does that mean the sec has got to step in we know starting on february 18 vlad tenev of robinhood is good to be on the house financial services committee i hate to see how that goes down do they know enough what the problem is so they can fix the correct issue. >> i think there's a number of issues they will address but there's a couple of things we know off the back we know right now when you have prices of assets that are nowhere close to what we can think of the fundamental value and we know folks are pushing them around, manipulating out in public frankly the things posted on reddit if they were between two hedge fund managers and nobody else all them and they were on an e-mail they would be exhibit to a criminal if not civil case, what we have to know the are the fec rules effective and being enforced on the exchange roles effective in being enforced if these prices were going to 0 instead of infinity do we think exchanges would've stepped in, we obviously have payment

did they have any conversations with anyone at citadel? of this has to be investigated and i think the financial services industry well. romaine: there are people that look at what transpired over the last few months and say, if individuals on some individual bases lost money or made money, it does not matter as long as there is some sort of systemic risk to the broader market. is there some sense you have so far that there could have been or would be some systemic risk by allowing these practices to go on? >> it does matter if you don't have a lot of money. if you are a student or just getting into the market. for many people, this makes a huge difference. and are not really looking at it from a perspective of folks who are on reddit. the biggest systemic risk to our economy in my view is the over financial eyes asian, the speculators asian -- the speculization. why are we having that capital but electric factories, solar plants, new industries? which we could if the government of the federal financing bank -- that is the take away. joe:

our road map begins with the gamestop hearing with the ceo, robinhood, reddit, melvin, and citadel, all sort to testify. >> then the latest on that very cold weather in texas, as the governor warns of continued misery ahead >> and later, walmart drags down the dow, after falling short of the street on earnings we'll break down the quarter, ahead of our exclusive, with the ceo, later on this morning carl >>> guys, a lot of interest in the hearings this afternoon on gamestop, as we mentioned a pretty extensive list of people giving testimony one report, i only hope they dig down deep enough and discover as i assume that there were people disguising themselves as retail steaming on the crowd. >> i hope they dig deep as well. it's hard if you look at the history and track record of hearings on complicated issues and this is nothing short of complicated. we're talking about market structure here we're talking about issues of fairness in the markets. we're talking about the potential for manipulation none of these things are easy to really dig into on the surface, when you've got 54 lawmakers

last night we finally found out what the citadel of democracy is a citadel of.a citadel of psychotherapy. it's a self-help group for people who suddenly know how to help themselves. by direction of speaker pelosi survivors took to the floor of the house to tell their stories of survival. >> some are already demanding that we move on or worse, attempting to minimize, discredit, or belittle the accounts of survivors. in doing so, they not only further harm those who were there that day, and provide cover for those responsible, but they also send a tremendously damaging message to survivors of trauma all across this country. >> mark: you might think that's what tremendously damaging to survivors of trauma is for an insulated ruling class protected by its own dedicated police force to start appropriating the language and status of victimhood for themselves. talk about your cultural appropriation. we don't want to belittle the accounts of survivors as aoc says. aoc survived ted cruz trying to murder her. if you are also a survivor a ted cruz murder attempt, they have

citadel. she is the first republican woman to represent south carolina in the u.s. house and is the states only new faces this term on capitol hill. >> what was your childhood like? rep. mace: i'm the daughter of a retired army general, so i spent the first 10 to 11 years of my life traveling across the united states, different military bases. my father retired to south carolina, where i grew up and i call home. we call it low country. it is a coastal community along beautiful coastline and beaches. i dropped out of high school when i was 17 and my parents said if you're going to stop going to school, you've got to start going to work, and back in those days, my first job was a waitress at the waffle house off the interstate. i learned some very tough lessons and they were tough times but i learned the value of hard work. i had a lot of great experiences during that time. >> why were they tough times? rep. mace: because i dropped out at the age of 18 with no intention of going back. the princi

hot stocks robinhood, reddit, citadel and melvin get grilled ever wonder what really happens to your trade? pick it up, pick it up, pick it up the ceo of lordstown motors. >> hey there, i'm melissa lee. jim cramer's off tonight along for the ride this evening, brian kelly, delano saporu and anthony pompliano, aka pomp. citadel's griffin, reddit's huffman and of course roaring kitty himself all getting marathon grilling by house reps. in case you missed it, kate rooney recaps where a lot of the focus was directed kate >> hey, melissa. there were some tense moments and a lot of people forgetting to unmute. robinhood's ceo, though, got by far the most air time and congress really dug for my motives behind robinhood halting those trades in january. vlad tenev repeatedly denied he was on the side of the hedge funds. >> robinhood's securities put the restrictions in place in an effort to meet increased regulatory deposit requirements, not to help hedge funds. we don't answer to hedge funds we serve the millions of small investors who use our platform every day to invest. >> tenev did apolo

>> martha: she's the first woman graduate of the citadel, nancy mace. brian, thank you. great to see you today. >> great to see you. >> martha: so chicago's mayor, did you see this today? really big turn-around for lori lightfoot. talking about how angry she is at the teacher's union and that children are suffering at the hands of their obstructionism. >> we are failing those children by not giving them the option to return to school. failing grades. depression. isolation. so much more. >> martha: these things are very rile. bill bennett, dan henninger and jason riley next. student loans don't have to take over for the rest of your life. with sofi it's possible to get them paid off and start new. ♪♪ it's totally normal to have constipation with belly pain,

congress woman mace was the first to graduate from the citadel, a new member of congress and already gotten into this with aoc and other members of the squad. good to have you with us today. >> good afternoon. >> i want to ask you about that whole event yesterday where people could sort of step to the podium and talk about their experiences. you know, felt like a therapy session. nobody belittles how frightening this was for so many of you, but what was that exercise about, do you think? >> many cases yesterday what we saw on social media and some cases was that this was politicizing a lot of what happened. you politicize a traumatic event like this and i've been vocal about the events of that and i have not belittled anybody's experiences whatsoever. i was fearful that day.

robinhood makes its money by selling payment to order flow with the big hedge funds like citadel andbe probed in this hearing i think vlad has a lot of downside for him, we could see congress take action against order flow other countries like the uk have banned it and that could be disruptive to their business model. i do think robinhood's going to be in the hot seat today and they're going to have to explain how all of this sort of day trading and -- by the way, it's not just stocks. it appears that most of the trading on robinhood is of these options. so they'll have to explain how all of this option trading is beneficial, and so i think there's a lot of down side here for robinhood today. >> is there upside for investors like you who are looking for fresh ideas to serve the retail investor, perhaps? there clearly is an appetite there not just for gambling, but for participating in the upside for markets and perhaps in the way that the existing platforms are not serving. is that something that you're looking into >> very much so. >> look, i think we heard complaints from the wall

set of ceos are set to appear in front of the congress on this very issue the heads of robinhood, citadel, melviln capital and reddit are set to testify tomorrow. wee see convex about market manipulation in this new era, and of course some questions about conflicts of interest with hedge funds and market makers. morgan, back to you. >> let me ask you this, if i might, kate. is mr. gill likely to appear if he appears, is he likely to talk if he faces the potential of prosecution >> as of this afternoon, gill is set to testify he's the only non-ceo in that group. he's in the company of big ceos of hedge funds he is expected to speak. we haven't gotten word that that has changes since the lawsuit dropped. he is sore of emblematic of this new type of trader and the phenomenon of people -- he did sort of -- and it does seem he's more of a professional traders based on this lawsuit. >> what do you think, headband or no headband when he appears in front of congress what would you advise? >> that's a great question i'll take the over on that i think maybe we'll see a head band. >> wow i would lov

annmarie: that brief exchange we saw was with citadel ceo ken griffin and a democratic senator. was he painted as the villain in all of this from lawmakers? >> the robinhood ceo was painted as the villain. ken griffin got a lot of accusations of hedge funds being bullies. one specific he got grilled over was the idea of a tax financial transactions. he argued that would not be in the best interest of pension funds, the average american saver. the attitude from democratic lawmakers is that wall street is on the side of wall street and nobody else. ken griffin pushed back quite strongly. annmarie: ed ludlow, thanks for that. tim graf still with us. i want to get a sense as a macro strategist, when we saw this gamestop frenzy, did you learn something from this? did this make you worried about other frenzies in the years to come? >> i guess i learned people are really bored. when you limit their options for entertainment, they will turn to things like betting on stocks. this is still a pretty small corner of the financial market, despite the headlines and the moves we saw in gamesto

liz: i want to know if either of you gentlemen believed when ken griffin of citadel -- he founded citadel hedge fund -- and vlad tenev made the following comments when asked whether they worked in conjunction or cahoots, whatever you want to call it, when they had -- when at least robinhood had prevented investors from buying. not selling, only buying their favorite stocks. overnight this happened in mid january, and let's listen in to what they said, and then i'll let you comment. >> let's be crystal clear, that decision you made to restrict the buying but not the selling of gamestop was based, was it based on pressure from anyone on the witness panel here today? >> not at all. zero pressure from anyone. >> we had no role in robinhood's decision to limit trading in gamestop or any of the other meme stocks. i first learned of the trading restrictions only after they were publicly announced. liz: attorney general paxton, i, you know, do you believe that? let's just get to that point. >> well, so i remember ronald reagan saying trust but verify when they were dealing with the soviet group c

that is one reason i want citadel there. robin hood and citadel for example. so again, i'm going to listen to what they have to say, and in the final analysis the truth of what each of these players did or the way they were involved will come out. >> there are other characters in this story as well, congresswoman, like dave portnoy the famous retail trader, elon musk got involved. mark cuban do you think they bear any responsibility >> we don't know that is a whole nother issue, dealing with elon musk and bitcoin and all of that. that will not play in these hearings especially tomorrow. what we are going to do is deal with the players that have been clearly identified that were involved in january 28th i want to know exactly what happened with melvin capital and, you know, if they in fact were the ones who were involved with borrowing the stock, you know, from gamestop and they shorted it i want to know what they did i want to know how long they held it. i want to know what they did in between the time it was borrowed and th

citadel. at that time, my mom taught courses at my high school. i was not going to go back and i was not going to sit for the ged because i heard "test," and i was a 17-year-old kid. but i started college at 17 and was able to get credit for high school work and graduated just a few months later with my diploma in hand at the age of 17. that was in 1995. a year later in 1996, the citadel decided to allow women and they made the decision on the same day that justice ruth bader ginsburg wrote the majority opinion on a supreme court case against the virginia military institute that stated if you are a state funded, government funded institute of higher learning, you cannot discriminate based on gender. that decision literally changed my life. i enrolled in the citadel, i applied and enrolled and was accepted immediately after that, within a few days. that place saved my life and i learned a lot of lessons in those years. greta: why did it save your life? rep. mace: when i was 17 and dropped out o

and robinhood, the relationship between citadel and melvin, how all of the different players connectnd the various incentives there i think you're right, the fact that, you know, you do have this whole little guy versus big guy narrative that has played out, although if you really dig beneath the surface, it's so much more complicated than that. still, you know, this is politics this is washington it will be broadcast, so there is some sort of a theoretical aspect that is to be expected here, especially when you have a situation like this one where it is very complicated. i'd personally love to see it go down, you know, deep into the weeds, and hope it gets there, but i think there will also be some theatrics as well >> yeah, not usually the forum that is good at dealing with nuance and complicated subjects like this. >> no. unfortunately. >> leslie, thank you, we'll check in with you later today. obviously there's a lot to look at with this and a lot to talk about before and after we'll see you soon. >> thank you. >>> okay coming up after the break, a wide ranging interview with bil

they want to figure out if there was collusion with citadel another hedge funds.tly trying to peace through what happened and if they should -- if there's a role that congress needs to play or if they need to mostly let the sec handle this one. tom: the bottom line is come our audience is going to be fascinated by what ken griffin does with citadel. he will show up with an entourage of 40 people to be sure he says all the right words. what will you listen or from someone like mr. griffin? emily: going back to the big lawmaker question, was there any sort of collusion -- tom: what is he going to say, "yes, there was"? come on. emily: he is not going to say that, but that is why lawmakers will be asking questions, listening to what -- tom: they will be giving lectures. jon: tom, course they will. lisa: don't worry about it, emily. we all know they are basically going to be using this as a part. the key is, will anything come of this? as anything ever come of this? key things have come on the seamless talks. can you give us a sense of where we are and how much energy

citadel securities, which handles more than 1/5 of u.s.ity volumes, has paid more than $1 billion for order flows last year. some of these market makers are high-frequency traders who handle orders in fractions of a second. their involvement theoretically benefits customers. bloomberg intelligence analysts calculate it save the retail traders 3.7 billion last year. yet the practice has drawn a lot of criticism. senator elizabeth warren says there are troubling concerns about robinhood's relationship to wall street, and has called for a clearer accounting of the relationship between counterparties. still, payments per order flow has made it much easier to provide services to new day traders, and expand access to stock markets. it may be here to stay, but it is likely to stay under scrutiny. emily: bloomberg's sonali basak with more on the upcoming hearing i am joined by duke law professor gina-gail fletcher. thank you so much for joining us. do you see a problem with payment for order flow? gina-gail: yes. payment per order flow i think is

we are in this real world where they stuck at the citadel, the hedge fund. they made a bunch of money for sid it all securities, the market maker. we have seen other big smart money players profit. silver lake is one of them, specifically on amc, bringing $113 million thanks to convertible bonds they have on the company so this goes to emphasize the point that this is not retail triumph in over the hedge funds. we have seen plenty of classic wall street players come out really well during this gamestop saga. manus: the other thing to note is that margin, for every group brokerage, they decide how much margin you need to stump up. that ramp in margin is ultimately the blocker that stops many institutions and it was not just robinhood that stopped the trading on a number of stocks. they have come back to eight stocks rather than 50, but where are we in terms of mom-and-pop and the investor that does not hold a position? dani: even though some of the trading was blocked, the spreads on gamestop got so blown out that we had market makers making a lot of money ev

that both robin hood and citadel deny.e is done. the listing legacy may well be small scrutiny if not an outright ban on this financial practice. michelle fleury, bbc news. joining me now is amanda cooper, markets editor, insider. thank you forjoining us. what is this hearing likely to achieve here? are we looking at fines? i achieve here? are we looking at fines? ~ achieve here? are we looking at fines? ~ ., , fines? i think that is absolutely - fines? i think that is i absolutely impossible fines? i think that is - absolutely impossible to say. the point of the committee hearing today is to talk precisely about these issues. online trading, payment for order. all the kind of all the players will be giving testimony.— players will be giving testimony. players will be giving testimon .~ . , ., testimony. what is the game bifurcation. _ testimony. what is the game bifurcation. it _ testimony. what is the game bifurcation. it is _ testimony. what is the game bifurcation. it is turning - bifurcation. it is turning tradina bifu

suffering amid the game stop surge was melvin capital management which another hedge for and citadel has since bailed out in these losses citadels founders can grip and who also founded so those securities a big investor in robin hood up also works with t.d. ameritrade and charles robb the companies that were cutting these people out and saying you cannot buy game stop on our apps anymore. are companies that actually have connections to to melvin management who is losing money because of what was happening and it all comes full circle i think that what this goes to show is that one there is the mechanisation behind all of this drive to shut people out and once they saw that so many people had gotten involved and engaged in that raid it had basically taken over to a certain extent and they were a to stop it immediately and now you know these organizations as well as those who actually bought the stocks are calling on congress for 2 very different things one you know the stocks and sells there they just want this to you know it in the individuals they're saying well this is the this is

what has he done with his shares and why and the small fund manager who told billionaire hedge fund citadel and what he's planning now, wall street rallying on the first in february, i would say rallying we have 300-point games for the dow jones industrial in the nasdaq right now but as silver the new target for the reddit rebels goes higher and mining stocks spike, is a wall street best crowd new darlene trade already getting a bit long. plus hillbilly harvest, hillbilly offer is here with the ceo of apple harvest, today makes its public debut and tries to disrupt agricultural space. mother nature also in the business of disruption this hour as a powerful winter storm stops covid vaccinations in their tracks. we will take you to all places fenway park. where this is happening. we have breaking news to begin with free trading up robinhood just cobbled together another emergency lifeline in the last few hours robinhood revealed it raised an additional $2.4 billion after experiencing a cash crunch sparked by an army of individual investors who have been snapping up shares of heavily shorted s

citadel provided a cash infusion about a week ago citadel's flagship fund down about 3% for the monthg some significant losses for the month of january tyler? >> what is the outlook for regulation, not ned of hedge funds. what does your spiedy sense tell you? >> i think that's the number one question i get from a lot of people, you know, where is the s.e.c. on this at this point it's unclear so far they have put out two statements, and they're making sure that the little guy doesn't get hurt here, but you know, it's really different to tell, because like i mentioned people use aliases for this. it's not easy to trade back who started this thing, to push a stock price higher, whether there's any nefarious activity going on it's a complicated because of the disparate nature of these forums, as well as people don't have to use their real names most people don't use their real names to post comments >> yeah. leslie, thank so much. morgan >>> thanks, tyler. ahead on "power lunch," vaccine roll-out continues to hit roadblocks we'll speak to one doctor who took parts in trials of the j & j v

robinhood is making their profit off of citadel.the company made 100 million in the first quarter of 2020. did you think that robinhood was just doing this for charity? no. they are a broker but they're not a fiduciary. so here's the difference. here is the explanation when we show you for fiduciary. the fiduciary standard require advisors put best interests ahead of their own. if two equal products have different fees the advisors is compelled to recommend the one with the least cost to the client even if 2 will bring less revenue to the advisor. this is not robinhood to be clear here. okay. they are held to a suitability standard at robinhood. in this standard advisors merely rerequired investment options fit clients objective, time horizon and experiences. i don't know about but i've been asked repeatedly to explain what a short or short squeeze means. another term floated amongst the robinhood now is the naked short. this allows sellers of an asset the ability to sell without borrowing the underlying asset, aka gamestop. the rob

robinhood takes your data to sell it to citadel to computer and sell in front of you.e. why goldman sachs makes money 52 out of 63 trading days. short selling is wall street's dirty little secret they don't want the little guys in on it. charles: in your opinion what will happen? kabuki theater dies down. something dies down, another hearing in two months, we're back to square one, are small investor on their own still? will they do anything to even make it look like they're trying to level the playing field? >> well, charles, i can tell you this, i know how much you care about our country. i know how much you care about individual investors. the real thing that we should being banging the drum on is if you want to see hedge funds stop making billions while pension plans are making peanuts, pension plan managers around this country should demand their custodial banks do not len made shares out anymore so they can be shorted. we can protect a big portion of society, public employee retirees. the hedge funds are making billions. the plans that are supporting the trade li

, citadel one of the largest hedge funds in the world.adel also had to sit back, melvin capital one of the biggest losers on the shortened gamestop and the committee is expected to ask questions of the ceo of citadel, wrote-- robinhood and melvin capital. robinhood ceo will say no that that is not the case in his opening statement and citadel will push back on accusations robinhood promotes risky options trading while the committee will probably hammer the billionaire hedge fund ceos about shortselling in one interesting character in this will be that gamestop reddit trader better known as brawling kitty. he is still bullish on gamestop and talking to those on wall street i had to say they did not think they would expect new answers and the questions-- it's a comic it'd issue. david: that's the bottom line, there could be a lot of grandstanding and to separate the truth and facts from the grandstanding could be hard to do. it will be fascinating. thank you. let's bring in mike murphy. mike, the big question susan was talking about, was ro

so dell's can griffin -- citadel's ken griffin is set to testify at a hearing today.oined by the chief of melvin capital and the reddit user known as roaring kitty. i love that. let's get to dani burger. roaring kitty. what a name. >> that is his youtube name. he has a name on reddit that is too explicit for us to say on air. if you look at the memo i have here, they have the name here, the explicit one. it is weird to see a very serious congressional memo say a name on it we cannot even say on air. within this memo you get the idea that what the house is looking at is the idea, have laws kept up with the change in trading and social media where users can more easily trade on things like robin hood and can talk about it on reddit, whether or not their username is explicit. they are going to be looking at shortselling, stock manipulation, the game with occasion of the stock market -- gamification of the stock market. we have prepared testimony from the witnesses. vlad 10 a for his expected to say the idea we had help from hedge funds, that is absolutely false and marke