The Hanged Man

The Hanged Man – Robinhood

The hanged man understands the importance of sacrifice to be able to move forward. The card reflects a particular need to suspend certain action and as a result, this might indicate a certain period of indecision. Pulling the hanged man card means that at a cross-roads where a critical decision is needed, you should consider the decision you are about to make carefully before making it. Although a decision is needed to be able to move forward, the implications of the wrong decision can lead to severe consequences. Keep in mind that taking action is not always the best solution and in certain cases refraining from doing so might bring you just as much, if not more benefits.Robinhood Facts:

  • Founded in 2013
  • Free stock-trading app that makes it easy to buy/sell stocks without professional help
  • Allegedly believe “the financial system should be built to work for everyone”
  • Have been accused by some state regulators of “gamifying” investing (ex – confetti graphics when someone makes a trade)
  • The company also had a complaint filed against them by Massachusetts security regulators in 2020 for violations of state law, “including its aggressive tactics to attract new, often inexperienced, investors.” The U.S. Securities also charged them with misleading customers about revenue sources and failing to satisfy duty of best execution. Robinhood paid $65 million to settle.
  • In January 2021, activist investors who convened on the subreddit r/WallStreetBets decided to invest in the stock of GameStop – a company that short sellers had been rooting for the failure of. The value of GameStop shot up “to the moon”, so short sellers lost a lot of money and the stock market kind of broke.
  • Soon after this started happening, Robinhood started restricting some GameStop transactions (as well as other stocks that became part of this phenomenon) and GameStop transactions dropped dramatically.
  • For a company with a name that basically means “take from the rich and give to the poor”, this was a bad decision and made a lot of people mad.
  • Robinhood said they did it because they had to keep a lot of money on hand in order to process all the trades happening and the GameStop situation was too risky.
  • After this, the U.S. Securities got involved again and said it would “closely review” what happened with GameStop stock and a lawsuit was filed against them in New York.

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