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Robinhood CEO among those grilled by U.S. lawmakers over GameStop trading frenzy – CBC.ca

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Key players in the GameStop saga faced questions Thursday from U.S. House lawmakers concerned that even as investing becomes more democratized the scales are still tilted in favour of the big Wall Street institutions.

GameStop shares soared 1,600 per cent in January before retreating sharply. The drama entangled huge short-selling hedge funds, a social media message board and ordinary investors wanting in on the hottest new trade.

Some of the toughest questions and harshest criticism was directed at Vlad Tenev, CEO of Robinhood, which operates an online trading platform that is popular with individual investors. Tenev defended Robinhood against allegations that trading restrictions it put in place at the height of the GameStop frenzy disadvantaged those smaller investors in favour of bigger institutional clients.

The head of the financial services committee, Democratic Rep. Maxine Waters, brusquely grilled Tenev on those restrictions. She also asked Tenev about Robinhood’s close relationship with Citadel Securities, which she maintains poses a conflict of interest.

At issue is the common practice in the securities markets of payment for order flow, in which Wall Street trading firms such as Citadel Securities pay companies like Robinhood to send them their customers’ orders for execution. In addition, platforms like Robinhood give the trading firms data on stocks its users are buying and selling.

Robinhood CEO Vlad Tenev testifies during a virtual House committee hearing on GameStop in Washington, on Thursday. (House Financial Services Committee/The Associated Press)

CEO apologizes

Both Tenev and Ken Griffin, the CEO of Citadel, denied that Citadel had any role in Robinhood’s decision to restrict trading in GameStop and some other volatile stocks.

Tenev said Robinhood imposed the trading restrictions solely to meet capital requirements set by regulators. Still, he apologized to Robinhood customers.

“Despite the unprecedented market conditions in January, at the end of the day, what happened is unacceptable to us. To our customers, I apologize, and please know we are doing everything we can to make sure this can’t happen again.”

The panel’s senior Republican, Rep. Patrick McHenry, put forward conservatives’ view that the GameStop episode shouldn’t be used by Washington to bring new regulations on the markets.

Also appearing was Keith Gill, who earned a handsome profit and a legion of online followers for making the case for GameStop shares on Reddit and YouTube long before the big surge in the price in January. Gill, known as Roaring Kitty on YouTube, is known for his cat-themed T-shirts and a bright red runner’s headband in widely followed videos.

For the hearing, Gill wore a jacket and tie, although the headband could be seen in the background hanging on poster of a kitten with the words “Hang in There.”

GameStop investor Keith Gill testifies on Thursday. (House Financial Services Committee/The Associated Press)

‘Roaring Kitty’ denies touting

Gill told lawmakers that he reaped a profit on his investment because he did his homework, and not because he touted the stock.

“The idea that I used social media to promote GameStop stock to unwitting investors and influence the market is preposterous,” Gill said.

“My posts did not cause the movement of billions of dollars into GameStop shares. It is tragic that some people lost money and my heart goes out to them.”

GameStop shares rose as high as $483 US in January but reversed course this month and now trade around $45, still more than double where they traded at the start of the year.

Small investors were initially seen as the winners after they mobilized against Wall Street heavies on the subreddit chat forum WallStreetBets. Their buying swelled the share prices of GameStop and other beaten-down companies beyond anyone’s imagination.

Not coincidentally, the rally inflicted billions in losses on the hedge funds that had placed bets that the stocks would drop, a practice known as short-selling.

Some of the lawmakers at the hearing have been critical of short-selling, although defenders of the practice say it’s a tool for uncovering a stock’s true value and hedging against possible losses.

Chicago-based Citadel stepped in with a few other funds to rescue Melvin Capital Management after it sustained billions in losses on its GameStop bets. Gabriel Plotkin, Melvin Capital’s founder and chief investment officer, denied those investments represented a bailout of his firm.

As the GameStop frenzy escalated, the acting head of the Securities and Exchange Commission said the agency is examining the trading restrictions imposed by Robinhood and other online brokerages as well as possible stock manipulation, and the role that short-selling may have played in GameStop’s extreme price swings.

“Rather than new regulations, what is likely needed is a course on risk management and prudent decision making,” said Willie Delwiche, investment strategist at All Star Charts.

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Peel and Toronto's top doctors want to be placed in lockdown level of Ontario's framework for coronavirus restrictions – CP24 Toronto's Breaking News

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Toronto’ top doctor is asking the province to place the city in the grey lockdown category of its framework for COVID-19 restrictions as of Monday, allowing non-essential retail stores to reopen while keeping most other businesses closed.

Medical Officer of Health Dr. Eileen de Villa shared her recommendation during a briefing at city hall on Wednesday, calling it a “modest step towards more flexibility in daily life.”

If approved by the provincial government the designation would allow non-essential retail stores to reopen across the city, including those located in shopping malls.

Most stores, however, will be limited to no more than 25 per cent of their regular capacity. Grocers, convenience stores and other businesses that primarily sell food will be allowed up to 50 per cent of their regular capacity.

“Based on the data in front of us it is clear that reopening widely such as under the red category of the provincial framework is not advisable at this time given our case counts,” de Villa said, noting that the number of samples that have screened positive for a variant of concern in Toronto have doubled over the last week. “Moving out of the stay-at home order is a reasonable course of action for Toronto although I will add that while there are evident reasons for a change in status there remains reasons or risks that underscore how moving back into grey status is, or will be, a delicate balance.”

The province lifted its state of emergency order last month and began gradually moving regions back into its framework, with the exception of Toronto, Peel and North Bay which have remained under an extended stay-at-home order.

As part of Toronto’s potential move back into the grey zone, de Villa has issued a Section 22 order that will establish a series of additional requirements for workplaces with active outbreaks, including the mandatory wearing of masks at all times by employees.

De Villa said that she has also asked the Ministry of Labour to conduct a “workplace inspection blitz” in the city.

“Returning to the province’s framework represents a modest step towards more flexibility in daily life which can be taken because we all worked to limit the spread of COVID-19 but it is important that we all act in ways that do not squander these hard earned small steps forward,” she told reporters. “It is a question of preserving what we have gained.”

Wednesday was Toronto’s 100th consecutive day under a lockdown but the recommendation made by de Villa could represent a slight loosening of restrictions for the first time since this summer.

Of course, restaurants and bars will remain takeout-only and other businesses like gyms and hair salons won’t be able to reopen for at least two weeks.

Indoor gatherings of people from different households will also continue to be prohibited, though outdoor gatherings of up to 10 people will be allowed.

“I am very sympathetic to those who will not be able to reopen going into grey but I think the best way in which we can avoid that further lockdown later on, which I think everybody to a person says would be the worst case scenario, is to take these cautious steps one at a time and to follow public health advice and keep doing what we have been doing in many respects and then the day may not be too far down the road where we can do more,” Mayor John Tory said during Wednesday’s briefing.

Peel’s top doctor has also asked for region to be kept in grey

De Villa’s announcement on Wednesday afternoon came hours after Peel’s Medical Officer of Health Dr. Lawrence Loh confirmed that he would also be advocating for his region to be placed under the grey lockdown category in the province’s framework.

The recommendation from Loh comes despite a vocal campaign from Mississauga Bonnie Crombie to have the region moved into the red zone, which would have allowed indoor dining to resume at bars and restaurants with capacity limits.

“From five cases just two weeks ago we now have over 100 confirmed case of variants in our community and 600 that have screened positive and these numbers give me pause,” Loh said earlier in the day. “Our hospitals are also seeing admissions related to spread of variants and while ICU occupancy has improved from the peak of the second wave it still remains at levels similar to what e saw in wave one in the spring of 2020. Reopening too quickly risks eliminating the gains we have made and putting lives and wellbeing at risk.”

Peel’s rolling-seven day average of new cases has risen from 194 at the this time last week to 213.

It also has the highest weekly incidence rate of any public health unit when adjusted for population.

Loh said that if conditions were different he would “absolutely recommend loosening measures more quickly,” as he did in July but can’t do so while cases are rising.

Speaking with reporters during a subsequent news conference on Wednesday afternoon, Crombie conceded that she was “extremely disappointed” by the decision but said that she understands the reasoning behind it.

Nonetheless, Crombie said that she wants the data reviewed on a weekly basis so that Peel can be moved to the red zone as soon as possible.

The province has typically said that it will not move regions to a new level in its framework until it has two weeks worth of data.

“It is extremely unfair that businesses in neighbouring regions have been allowed to reopen more fully. Think about this for just a moment if you will. If you are standing at Dundas Street at Winston Churchill Boulevard restaurants and stores on the south side of the street are open for business for in-person shopping and dining while on the north side of the street they are closed because the north side of the street is in Mississauga. That is simply unfair and also inequitable,” Crombie said.

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Trudeau 'optimistic' that timeline for rollout of COVID vaccines can be accelerated – CP24 Toronto's Breaking News

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  1. Trudeau ‘optimistic’ that timeline for rollout of COVID vaccines can be accelerated  CP24 Toronto’s Breaking News
  2. AstraZeneca doses set to arrive tomorrow — but questions remain about who gets them first  CBC.ca
  3. First doses of AstraZeneca COVID-19 vaccine arrive in Canada amid confusion over who should receive them  CP24 Toronto’s Breaking News
  4. LILLEY: A jab for all by summer?  Toronto Sun
  5. Vaccine preference a problem for EU leaders  Irish Examiner
  6. View Full coverage on Google News



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Nova Scotia to Receive AstraZeneca COVID-19 Vaccine – Government of Nova Scotia

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  1. Nova Scotia to Receive AstraZeneca COVID-19 Vaccine  Government of Nova Scotia
  2. Nova Scotia hasn’t decided if it will accept deliveries of AstraZeneca vaccine  CTV News
  3. COVID-19 vaccines to be made available in Nova Scotia pharmacies  CBC.ca
  4. VOICE OF THE PEOPLE — March 3, 2021  TheChronicleHerald.ca
  5. TOM URBANIAK: Nova Scotia needs a child advocate  TheChronicleHerald.ca
  6. View Full coverage on Google News



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