Thursday: thinking about compliance

When I was listening to Bloomberg the other day, a woman (not an anchor and, alas, I do not recall her name or what company she worked for) commented that she felt like the market was not correctly pricing in regulation / compliance changes that were coming very quickly. She then went on to talk primarily about oil and gas, but I cannot stop thinking about her remark in the context of the meme stock thing.

So I looked up what turned out to be Rule 6, and got hung up on the collared shirt requirement and then went ‘round trying to find coverage of what people were saying about whether or not Robinhood had met its regulatory requirements for vetting its customers for doing options.

Oh boy.

If you had asked me yesterday, even, “Will Robinhood survive the meme stock event?” I would have said, yeah, sure, probably some fines, some disclosures, some tick boxes, etc.

Now?

I kinda have a lot of doubts about whether Robinhood will be a going concern in a year. All their reasonable customers can easily go to a competitor; the only people who really have to be on Robinhood are the people doing the things that are finally attracting enforcement attention. Usually, when that happens, the End is Nigh.