GameStop fiasco brings market's trust deficit into full relief

JUST days after the release of the Edelman Trust Barometer titled "Declaring Information Bankruptcy", Wall Street experienced an information crisis firsthand, courtesy of Reddit and GameStop. The wild January ride has put a focus on investing versus speculation versus gambling, in the context of an environment where many betting outlets have been paused due to Covid-19, and technology has enabled free and fast access to markets.

This has attracted many new market participants. How will they fare in the long term? Will this democratise markets and make them more inclusive, so more people benefit from long-term value creation? Or will it lead to a different "investor class" that views investing as a new form of (sometimes very costly) entertainment?

The GameStop fiasco brought the market's trust deficit into full relief. Hearings are planned in the House Financial Services Committee and Senate Banking Committee of the US Congress. CFA Institute, a global association of investment management professionals, will be actively following these events, and we are engaging with various industry stakeholders about investor protection and ways to foster the integrity and transparency of markets.