Sen. Elizabeth Warren, D-Mass., guides a news conference in the Capitol, March 1, 2021.
Tom Williams | CQ-Roll Call, Inc. | Getty Images
Sen. Elizabeth Warren is charming aim at Archegos Capital Management and the lightly regulated hedge-fund industry after their stock trades sent the shop into a frenzy late last week.
“Archegos’ meltdown had all the makings of a dangerous situation — largely unregulated hedge scratch, opaque derivatives, trading in private dark pools, high leverage, and a trader who wriggled out of the SEC’s enforcement,” Warren touch oned CNBC in a statement Tuesday.
By the time Credit Suisse and Nomura, two prime go-betweens of Archegos, announced early Monday that they faced losses that could be “highly significant” to the banks, challenge firms Goldman Sachs and Morgan Stanley had already finished unloading their positions, according to people with consciousness of the matter. They requested anonymity in order to speak about private negotiations.
Goldman managed to sell ton of the stock related to its Archegos margin calls on Friday, helping the firm avoid any losses in the episode, according to one of the man. Morgan Stanley sold $15 billion in shares over a few days, avoiding significant losses, CNBC’s Leslie Picker put out.
— CNBC’s Hugh Son and Leslie Picker contributed to this report.