[HN Gopher] Senate Stock Watcher
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Senate Stock Watcher
Author : ericmay
Score : 184 points
Date : 2020-04-10 16:20 UTC (6 hours ago)
(HTM) web link (senatestockwatcher.com)
(TXT) w3m dump (senatestockwatcher.com)
| lowercased wrote:
| the senate website source...
|
| It shall be unlawful for any person to obtain or use a report:
|
| * for any unlawful purpose;
|
| * for any commercial purpose, other than by news and
| communications media for dissemination to the general public;
|
| * for determining or establishing the credit rating of any
| individual; or
|
| * for use, directly or indirectly, in the solicitation of money
| for any political, charitable, or other purpose.
|
| "...indirectly... solicitation of money... for any ... other
| purpose".
|
| The author of the site links to a site which takes donations. Is
| this a violation?
|
| I'm not suggesting he shouldn't take donations; I'm suggesting
| the language in the usage terms are too overly broad.
| voz_ wrote:
| This is news and reporting.
| whatsmyusername wrote:
| Who cares? It's obvious 'the rule of law' means nothing in
| 2020.
| totalZero wrote:
| The easy solution to this problem would be to either require
| Congressmen to publicly announce a transaction prior to effecting
| it, or to tax their capital gains heavily for transactions made
| outside of a predetermined window.
| croshan wrote:
| The general public doesn't have great trading strategies, but
| Senators may be more well informed. I wonder how a bot based off
| of their trades would do.
| neltnerb wrote:
| I suspect they're sophisticated enough to turn something like
| an "index fund of what the people in charge buy" into a profit
| by making sure the timing of the reporting makes it more
| profitable for them.
|
| Since the reporting isn't instantaneous, they of course also
| have insider knowledge of their own trades and that those
| trades would influence markets and when. They could screw
| around with the timing of trades to give misleading stories,
| like selling off a bunch of stuff just before they file a
| report and then buying it after their action tanks the price.
|
| But a virtual index fund that tracked their purchases and sales
| to make a record of how well Senators do in the stock market
| compared to an index fund (which I believe are also run by well
| informed people)? That might shame them into changing the rules
| if it looks bad. Of course, I don't know enough to say they
| aren't behaving themselves.
|
| Some cases that look suspicious might, when taken as a whole
| with their other trades, average out and make clear that they
| lose money even when they have insider knowledge that they will
| lose money. Somehow I doubt that, but if it's truly a blind
| trust or an independent fund it should be true and would
| increase faith in our elected officials to see hard data for.
| tantalor wrote:
| You can fix that by coupling their trades with the "index
| fund", so their bid/ask for X shares at price $Y is combined
| with some # of shares of the common fund proportional to
| shares held by all members. Then the trade is executed
| atomically and we get the same price.
| foobarian wrote:
| I would be pretty surprised if various algo-trading houses
| don't already do it.
| Groxx wrote:
| The "Thoughts & Prayers" button is brilliant.
| kyleblarson wrote:
| It's sickening how all of these lifetime senators and congressmen
| can amass such wealth given the salaries of their elected
| positions.
| nightski wrote:
| What concerns me far more is how long they can remain elected
| vs. any corruption that happens while elected. We needed term
| limits decades ago.
| erentz wrote:
| Yes this is something that needs to be looked at more. How much
| does their wealth grow from the time they enter to the time
| they exit congress. Some politicians seem to get very wealthy
| while in congress.
|
| "You can't get rich in politics unless you're a crook."
| mulmen wrote:
| Would be interesting to create a senate-tracking "index" fund.
| Wonder how that performs against the market.
| noitsnot wrote:
| I think the site is definitely a good start. I would like to
| see accumulated data and charting. Which stocks have been
| bought and sold by week or month, etc.
| A4ET8a8uTh0 wrote:
| I am only half joking, but I can see advertising already. "Make
| money the way insiders do".
| mattkrause wrote:
| The STOCK Act (or Ethics in Government Act, actually) only
| requires reporting within 30-45 days of purchase/sale, so your
| fund will lag behind whatever market-moving events they're
| trading on.
| personjerry wrote:
| If you copy the long term plays it could still be viable.
| Gys wrote:
| If historical data is available, an aggregated result of this
| could be compared to the S&P index. To see if their trades
| actually outperform and therefore if they a better traders than
| average, and if so, this might mean they have better info.
| systemvoltage wrote:
| That's not guaranteed. There are number of reasons one of them
| being by sheer chance.
| pathseeker wrote:
| Yes, that's the point of measuring them. There are enough
| senators making enough trades over time though that there
| should be a clear out-performance bias _if_ they are insider
| trading with much significance.
|
| The whole problem with this approach though is that a smart
| senate inside trader (since the STOCK act) would not do these
| trades him/herself. They would trade inside tips to outsiders
| for favors instead.
| saas_sam wrote:
| There are many examples of sketchy investment behavior in the
| Federal government. I remember this one, courtesy of Nancy
| Pelosi and Visa. I thought I remembered her offloading $MMs of
| FB call options too just prior to railing against them, but I
| can't find an article on that one now that I'm looking. Link on
| Visa: https://www.investors.com/politics/editorials/pelosi-
| corzine...
| mikeyouse wrote:
| Investors.com is partisan garbage. They're famously the ones
| who wrote that Stephen Hawking wouldn't have been able to
| survive under the NHS and that we found yellowcake uranium in
| Iraq after the invasion. Their weird authorless editorials
| get into all sorts of 'the lizards walk among us' areas. As
| for Pelosi, their claim is that she killed legislation to
| limit swipe fees in 2007 -- in order to take part in an IPO
| in 2008 -- to then pass the swipe fee legislation in 2009
| (which would hurt the share price now that she owned the
| stock)? Meanwhile she held onto the IPO stock and bought 3x
| at prices of twice the dollar amount of the IPO?
|
| I'd love to see someone diagram how that is meant to be
| sinister.
| saas_sam wrote:
| Not sure about the first part, but to answer your question
| about the Pelosi example: The idea was that she and her
| husband accepted preferential access to Visa shares during
| IPO in exchange for delaying a bill that was set to pass by
| 2 years, thereby benefiting from 2 years of share price
| growth, not to mention a lower share price penalty given
| Visa had years more time to prepare for it. Did I do a good
| enough job articulating that without a diagram?
| mikeyouse wrote:
| That makes much more sense than they laid out.. then
| again there was that whole global financial crisis that
| happened during that time with George W. Bush in the
| White House, so it seems pretty implausible still?
| Anyway, I found a much more compelling article that
| doesn't end with the sentence, _" The list of financial
| "greed" and sleaze on the left is long. What a bunch of
| hypocrites."_
|
| https://www.thedailybeast.com/how-visa-courted-nancy-
| pelosi-...
| saas_sam wrote:
| Yes, better article for sure, thank you.
| justaguyhere wrote:
| _Then he joined MF Global Holdings and bagged a $14 million
| compensation package -- including $2 million in guaranteed
| bonuses, regardless of performance._
|
| Jeez man, I can't even get a 1% raise, despite being a good
| worker in my team. 2M guaranteed, regardless of performance?
| What a sweet deal...
| adamsea wrote:
| IMHO we don't even need to do that, I'd bet 50% of nefarious
| behavior could be caught by googling for information about
| companies which Senators buy or sell, and seeing if there's
| news which would indicate they took advantage of their office
| (being on a committee approving XYZ, etc).
| igonvalue wrote:
| > We document that a portfolio that mimics the purchases of
| U.S. Senators beats the market by 85 basis points per month,
| while a port- folio that mimics the sales of Senators lags the
| market by 12 basis points per month. The large difference in
| the returns of stocks bought and sold (nearly one percentage
| point per month) is economically large and reliably positive.
|
| https://projects.iq.harvard.edu/files/gov2126/files/ziobrows...
| applecrazy wrote:
| And if they're consistently worse than the average, just
| execute the inverse of their trades and beat the market. :)
|
| Joking aside, I'm surprised that members of Congress have even
| allowed to trade on the markets, given how much inside
| information they know.
| ericd wrote:
| Yeah, seems pretty obvious that they should at least be
| required to do the same sort of advance scheduling of trades
| that execs are.
| dlbucci wrote:
| I think it's actually worse than that: I think they are
| specifically allowed to do more insider trading than the
| average US citizen. I could be wrong though, I just heard
| that once upon a time.
| celticninja wrote:
| seems like the STOCK Act should have closed that loophole,
| https://en.m.wikipedia.org/wiki/STOCK_Act,so it's illegal
| we just have to see if anyone is prosecuted over it.
| jimhefferon wrote:
| If you are surprised the I wonder if you have been paying any
| attention, at all.
| nicota wrote:
| How about this one for suspected informed trading? ~40% in 2
| days...
|
| https://efdsearch.senate.gov/search/view/paper/82AAE77A-D129...
| (you have to agree to the terms first)
|
| Unless I misunderstood something, looks like Mark Begich bought
| KERX stock on 01/28/2013 for 1001$-15000$, sold at 01/30/2013 for
| 15001$-50000$.
|
| KERX closing price on 01/28/2013 was 6.06, and 8.49 2 days
| later... Verified by looking at charts in
| https://www.barchart.com/stocks/quotes/KERX/interactive-char...
| fragsworth wrote:
| God damn, there is no way this is anything other than just
| brazenly obvious insider trading. Completely unethical. Our
| representatives are complete and utter scumbags.
|
| Needless to say, this should be illegal. I honestly wish we
| could retroactively imprison them for doing this.
|
| The current state of the U.S. is so damn embarrassing and
| shameful. I literally cringe when I imagine internationals
| seeing what we do here.
| Cyberdog wrote:
| > The current state of the U.S. is so damn embarrassing and
| shameful. I literally cringe when I imagine internationals
| seeing what we do here.
|
| Sadly, the concept of politicians using their positions for
| personal gain is not a uniquely American phenomenon.
| icedchai wrote:
| As I mentioned above, it's a biotech stock. Those sorts of
| jumps (and dumps) happen all the time around FDA approval
| dates.
| devit wrote:
| Yeah, but perhaps he knew in advance that the FDA would
| approve?
|
| Of course, it could also have been modelling based on
| public info or simple gambling.
| three_seagrass wrote:
| Nobody is surprised that the stock went up or down.
| Wistar wrote:
| It IS illegal as defined by the STOCK Act of 2012.
|
| https://en.wikipedia.org/wiki/STOCK_Act
| missedthecue wrote:
| >God damn, there is no way this is anything other than just
| brazenly obvious insider trading.
|
| How do you figure?
| three_seagrass wrote:
| A U.S. senator buys random pharma stock the day before it
| announces their renal drug passed a trial, and then sold
| immediately after announcing.
| totalZero wrote:
| So he traded the catalyst.
| three_seagrass wrote:
| Keryx didn't apply for FDA approval until months later.
| seph-reed wrote:
| > I honestly wish we could retroactively imprison them for
| doing this.
|
| Imprisonment is long and expensive. Just water-board them for
| a few weeks, record them saying they'll never do it again,
| and send them off with a some self help books on how not to
| be a piece of shit. They'll probably thank you later.
|
| EDIT: I'm now laughing about a self-help book titled: "So you
| just got water-boarded by an angry mob. Now what?"
| icedchai wrote:
| That was a biotech stock. They are very volatile. If he held
| long term he would've done much better. If you search for FDA
| catalyst dates, you can find dates when drugs are going to be
| approved or denied, etc. It's like a coin flip.
| three_seagrass wrote:
| Except Keryx hadn't yet applied for FDA approval of _Zerenex_
| , so the action date isn't relevant. On this day in question,
| they came out of the blue and announced their renal drug had
| surpassed expectations in a trial, so a U.S. senator buying
| them randomly the day before is suspect.
| pembrook wrote:
| True, if Begich was a professional trader focused on biotech
| stocks, that behavior would be entirely normal.
|
| But...the guy is a career politician from Alaska. What are
| the chances he suddenly decides to roll the dice on an
| obscure biotech stock 2 days before a positive piece of info
| drops?
|
| You can see his other disclosures and its all mutual funds
| and blue chips.
| tigerBL00D wrote:
| That explains the stock's behavior. It doesn't explain the
| suspiciously fortunate timing of these transactions.
| [deleted]
| S_A_P wrote:
| My question is this- if one were to build a trading bot that
| bought and sold along with something like this- 1) would it be
| legal 2) I'm curious about the returns vs the market.
| justaguyhere wrote:
| periodic is spelled as perodic. Very neat idea, I hope something
| comes out of it.
| papeda wrote:
| I wonder if it makes sense to forbid members of congress from
| owning anything other than a narrow class of investments (for
| example homes and index funds, though I'm surely missing many).
|
| This sounds like the old "cut their pay!" argument. The rejoinder
| to _that_ argument is that it should be practical for people who
| aren 't already wealthy to hold office, and a low salary would
| hurt that.
|
| This is different because the hit to potential earnings from
| restriction to a basic generic portfolio seems small (maybe not
| relative to the upside from insider trading, but to what members
| of congress would make as average citizens). Heck, it's still
| possible to trade in index funds off insider information. But the
| advantage seems smaller.
| bmm6o wrote:
| No need to limit asset classes, this is the problem blind
| trusts are designed to solve. It's the tool that anyone who
| wants to avoid the appearance of impropriety uses.
| jimhefferon wrote:
| But the current majority, at least in the Senate, seems not
| to need to care about the appearance of impropriety.
| Cyberdog wrote:
| A question to people who might pay more attention to the
| functioning of Congress than me: Is much of their day-to-day
| business actually secret? If Congress is about to pass a bill
| which will benefit company X, can't we all go on to the House or
| Senate web sites and read the drafts of those bills and have the
| same "insider information" that they do? Are we just mad that
| they're paying more attention to what they themselves are doing
| and how it will benefit certain companies' stocks than normal
| people who have better things to do with their lives than track
| what Congress is debating from day to day?
| rrrrrrrrrrrryan wrote:
| Most of the actual negotiations do happen behind closed doors,
| and there are likely many times during their term when a
| congressperson would know of market-moving macroeconomic news
| before it's been publicly disclosed.
| intrepidhero wrote:
| I'd like to see someone dig up all the most egregious examples of
| suspected insider trading here and post it in the relevant voter
| guides for each member's reelection.
| throw2945015 wrote:
| How about making one for Congress?
|
| In 2011, "60 Minutes" reported that members of Congress could
| legally trade stock based on non-public information from Capitol
| Hill. video [0], write-up [1]
|
| [0] https://www.youtube.com/watch?v=2zh30lm7aSQ
|
| [1] https://www.cbsnews.com/news/congress-trading-stock-on-
| insid...
| noitsnot wrote:
| The Senate is part of Congress but The House doesn't disclose
| trades. The Stock Act of 2012 prohibits insider trading for the
| Senate and provides that trades are disclosed, which is why the
| data is available for that branch.
|
| https://en.wikipedia.org/wiki/STOCK_Act
| heyoni wrote:
| Ok this is really awesome. Now if you would just go ahead and
| create an API for this, so I can set my TD Ameritrade to trigger
| trades off of this information, that would be great.../s
| tasty_freeze wrote:
| It would be great if
|
| (a) elected officials could hold only cash, bonds, and index
| funds, specifically bonds and index funds that are open the
| general public and have at least $XX assets, to prevent
| engineering an index fund available only one one or a few people.
|
| (b) pay them better to make up for the loss of gravy. Sure, the
| pay raise would not be sufficient to make up for the lost income,
| but it should be high enough that none of them could complain
| they can't live on the salary. Paying the senate majority leader
| under $200K / year is not enough, considering they often have
| living expenses in Washington and their home state. Lower ranking
| members get paid less. Pay the leader $1M/year and everyone else
| $500K/year and then prohibit anything but vanilla investments.
| maxcan wrote:
| 100% agree. I'd be fine with 7 or 8 figure salaries for members
| of congress, the president, and top executives along with very
| strict rules on investments: treasuries with a small allocation
| to broad market, long only ETFs: S&P500, MSCI World, etc.
| SilasX wrote:
| I think it was Steven Landburg that had the idea that
| politicians and administrators should hold a broad-based index
| of their country's real estate, on the theory that better
| policies lead to land within the country being more valuable,
| and so it aligns incentives.
| mehrdadn wrote:
| How would you deal with their family, friends, etc.?
| vinniejames wrote:
| Where does this data come?
| croshan wrote:
| From the bottom of the page:
| https://efdsearch.senate.gov/search/home/
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(page generated 2020-04-10 23:00 UTC)