[HN Gopher] Unusual Stock Trading by Whales in US Congress ___________________________________________________________________ Unusual Stock Trading by Whales in US Congress Author : seriousquestion Score : 754 points Date : 2021-04-15 15:26 UTC (7 hours ago) (HTM) web link (unusualwhales.com) (TXT) w3m dump (unusualwhales.com) | foolinaround wrote: | Where there is a will, there is a way! | | As long as we have crooks as our representatives, they will find | various loopholes to cheat. | | Caesar's Wife Must Be Above Suspicion. | | When we find such folks, since the media won't ask those | questions, the constituents must call/write/email their offices | and know that they are being watched. | smooth_remmy wrote: | Isn't there a delay in seeing these trades? They're reported 2 | months after they happen, right? | hackeraccount wrote: | why doesn't someone create an index fund that just track | congressional trades? | cwkoss wrote: | there is reporting lag, so by the time you know about an | opportunity it is usually gone | macinjosh wrote: | Only government bureaucracy could convert what is essentially | class based market information access into something benign | sounding as "reporting lag". Maybe "scraps" is a more apt | term? | Sniffnoy wrote: | What the hell is with the interface on this site? I can't select | text, everything is acting funny... | AlexTWithBeard wrote: | The very minimal thing each and every one of us can do is to | write to their representative [1] and senator [2] expressing | concern over the issue. | | [1] https://www.house.gov/representatives/find-your- | representati... | | [2] https://www.senate.gov/senators/senators-contact.htm | adam12 wrote: | Clear corruption. | | https://www.youtube.com/watch?v=xNDHiiJaxes | ffff0ffffff wrote: | How about we just line up every politician fucking KILL THEM ALL! | floatingatoll wrote: | If the author of this site is reading this, you could add a | redirect for this URL with either trailing comma or trailing | comma-and-whitespace, to catch the cases where people copy a | little bit too much to the clipboard: | | https://unusualwhales.com/i_am_the_senate, | gnabgib wrote: | The title is "On Life, Liberty, and Stock Markets" (h2.. most | prominent on page), or "Unusual Whales" (html.head.title). While | this title might be a synopsis, it doesn't exactly hit the | guidelines[https://news.ycombinator.com/newsguidelines.html] | macinjosh wrote: | I am shocked, shocked to find there is gambling going on in here! | /s | | In all seriousness, if we are talking about privilege this | privilege the ruling elite has to participate freely in insider | trading behavior is bonkers. It likely just isn't the politicians | themselves. Their staffers, confidants, and so on could all be | benefiting. | | If Presidents are goaded to put their assets in blind trusts when | taking office why shouldn't principal members of the other two | branches of governments be obliged to do the same? | magwa101 wrote: | This is brilliant. This should be illegal. CEOs and anyone with | insider info have trade "windows", or are put onto "program" | trading. This should absolutely be happening to these servants. | voidfunc wrote: | If you want to get rich go into politics. | r00fus wrote: | Fixed: if you want to get rich, already be rich. If you want to | get into politics, it helps to be rich. | | Takeaway: just be rich, and you can do whatever you want. | hartator wrote: | It will be fun to have an index fund tracking this. Can't beat | the corruption? Just buy their market! | mabbo wrote: | The very people whose job it should be to stop this sort of thing | are the ones who are profiting from it. How do you change this? | | No really, how can we force congress to change the rules so that | elected officials can't profit from inside information? Why would | they ever vote for such a bill? | aaomidi wrote: | If this starts making a stink, they're going to create the | ability to not report your stock purchases. | throwaway1777 wrote: | I think opposite is more likely. After the GameStop fiasco | there is a push for more transparency, not less. | Scoundreller wrote: | That's what's happening with flight tracking info. | | It got too easy to see who's flying their private jets and | where. | | Meanwhile if you travel by car, get bent. | nickthemagicman wrote: | It's impossible. | | Who watches the watchmen? | | And Democratic party believes that bigger gov't is the solution | to many of our problems. | dlp211 wrote: | Show me a country with little government that is successful. | partiallypro wrote: | Comparatively speaking, most Western countries. | michaelmrose wrote: | Start with the 3 best examples you can name and we can go | over how regulated various industries are, what | percentage of income is paid in taxes, and what | percentage of their GPD is non military government | spending. | partiallypro wrote: | There is a lot more to governance than expenditures and | safety nets. I'm starting to think we've been in a free | society in the west so long that people have simply | overlooked the history of large governments stifling | industry and life. Limited government is a very big thing | in the West, even in countries with very generous social | programs. | michaelmrose wrote: | Could you at least pick one so we can talk specifics? | dlp211 wrote: | This is a joke right? Based on what measurement do most | Western countries have little government? | NoImmatureAdHom wrote: | Many people constantly deride them for lack of regulation | of X, where X is something the speaker believes has huge | negative externalities. | | Also, I'd point to a place like India for "big" | government: the government tries to run too many things | and does a bad job on average. | wpietri wrote: | If it's impossible to have an effect, then every government | would be equally bad at this. But that's not the case. | michaelmrose wrote: | In some states the people can literally make the law via public | initiatives. If you don't have that process at home push for | THAT. Looking at this map there are a lot of states that need | to work on step 1. | | https://ballotpedia.org/Initiative_and_referendum | aaomidi wrote: | > No really, how can we force congress to change the rules so | that elected officials can't profit from inside information? | Why would they ever vote for such a bill? | | The recent Black Lives Matter protests have taken a far more | aggressive turn against systemic issues. Systemic issues such | as the economy, the stock market, policing as a whole, and | capitalism in its essence. Donating to bail-out funds, joining | the protests, increasing awareness in the problems our economic | system has created for us without proper good-faith regulations | is all helpful. | | You can't reform corruption to this level. You need to cut it | out and start over. | giantg2 wrote: | "The very people whose job it should be to stop this sort of | thing are the ones who are profiting from it." | | Welcome to the system. This is pervasive in many other aspects | as well (court, police, DA, etc). | skohan wrote: | Checks and balances are supposed to address this issue. I | think the only one which really does the job here would be | the right to initiative/referendum. That or an electoral | solution, but that one's really hard since new legislators | will be incentivized to maintain the status quo. You would | almost need a new party defined around that one issue, which | is hard to imagine in the US. | | _Maybe_ an executive order could also prohibit this? I 'm | not sure. | giantg2 wrote: | "Maybe an executive order could also prohibit this?" | | I don't think this will help. I feel that executive orders | are misused and abused today. They are really only only | supposed to be executive guidance on how to enforce or | implement a law. Instead they are being used as redefining | law or even ignoring them. | Zelphyr wrote: | We have to do the work. We have to educate ourselves on the | issues which means reading bills as they are going through the | process and being voted on, calling and writing our | representatives to tell them how we want them to vote on those | bills. | | I have family who just love to complain about what legislators | are doing and how they're voting but have not once, ever, | actually contacted their representative about these issues. Not | once have they actually read the bills and tried to understand | them. It's all based purely on whatever news channel they're | watching. Yet, they somehow think that through all that | complaining they're actually accomplishing something. | | I know my family isn't unique in this. I was just talking to a | contractor who is doing work on my house that started in on | this nonsense. | seph-reed wrote: | The only reasonable way out is to create our own systems. You | have to stop thinking top-down. | | Liquid democracy is something that can be built from the ground | up, and has the potential to deprecate our modern system. | ek750 wrote: | I think I agree in theory, but I think we've seen in practice | that people are easily controlled by mass media. Wouldn't we | just be moving the locus of control? | seph-reed wrote: | Do you know what liquid democracy is? | | It's a form of representative democracy, so it should be | able to avoid the issues of oligarchy (being centralized | and easy to corrupt) as well as the issues of full | democracy (where every idiot has a say worth any experts) | cubano wrote: | Why would you believe that both the individual voters and | their delegates wouldn't be susceptible to almost all the | same corrupting and manipulative factors that plague | voting systems today? | | The OP is correct...spending in mass media on the various | issues would almost surely allow the purchasing of voter | mindshare just exactly as advertising today drives sales | of almost identical branded products for inflated prices. | | Don't get me wrong...in general I like the idea of | "liquid democracy" (I remember it being called | "Superdemocracy" back in the 80's when MajorBBS creator | Tim Striker very much lobbied for its creation)...but it | would be foolish to believe that the same forces that | corrupt modern politics wouldn't be able to corrupt it as | well. | seph-reed wrote: | Corruption is still possible, but the real trick to | liquid democracy is that every stage is a form of | escalation with the potential for correction. | | Let's take two scenarios: | | 1. a vote is being passed "up" and crosses an extremist | channel, it'll likely get locked in and come out even | more extreme than it started. extremists tend to look up | to people who are even more extreme. when this happens, | there's a good chance the person who's vote it originally | was will be upset with where it ends up | | 2. a vote is being passed "up" and crosses an | intellectual/thoughtful person, it'll likely get locked | into the academic/altruist channel and come out with an | extreme subject expert. this is the ideal outcome. | | Basically, at any point where the vote is being passed up | it can hit one of these channels and get locked in. | There's massive (and immediate) drawbacks to letting your | vote hit an extremist, and massive gains to passing to | someone who's more intelligent and thoughtful. | | While you're totally right about peoples first vote being | super manipulable, each successive pass off has an | opportunity for escaping that mind control. And once it | does, it'll stay out. | sethammons wrote: | my naive solution: politicians become monks. They go without. | They are provided modest housing and budgets. I'm sure there | are zounds of issues with it, but I like to imagine servant | leaders who go without to do more for the communities they | serve. | mustafa_pasi wrote: | The Catholic Church tried this and it did not work. Monks and | nuns still become greedy, still compete for positions of | power and still abuse their power when they get it. | NoImmatureAdHom wrote: | Maybe it helped for a while? | wpietri wrote: | I'd be happy with that, but perhaps an easier solution is to | make them moderately wealthy. Pay them a top 5% salary with a | guaranteed pension for life, plus mandatory open finances for | life. Then there's much less incentive to resort to graft. | socialist_coder wrote: | 100% Agree. Salaries for elected officials should be far | higher and then make punishments for this very very strict | so there's zero incentive to graft. | | The people running our country should not be making less | than any typical c-staff or high level executive. They | should be making lawyer/doctor/c-staff level money. | souprock wrote: | Make that a "top 5% salary" from the pool of Fortune 500 | CEOs, and it might do the job. | sethammons wrote: | Love it, that's the other side of the coin I like | michaelmrose wrote: | The income for a US senator or congressman is already | literally exactly at the 95th percentile at 174,000. Making | someone wealthy doesn't remove their incentive to gather | more wealth it gives them a stake and incentive to be more | effectively corrupt. | socialist_coder wrote: | 175k is not enough... it needs to be 300k at least. maybe | 500k. Something high enough that the risk-reward for | corruption is less attractive. 175k is a nice life but | not even remotely enough to have the lifestyle you'd | expect for someone running our country. | michaelmrose wrote: | It is the nature of ambition not to be satiated. people | making millions of dollars per year want to make | billions. Billionaires strive to exceed their peers. Our | leaders already have a lot to lose. Predictably most of | our corruption isn't high risk blatant illegality its the | boringly legal influence peddling where regular donations | buy your "totally legitimate" interests and concerns | additional consideration by decision makers instead of | paying n dollars for a particular law. | | There is no reason to believe paying them 2-3x as much so | they can be really wealthy would lead to electing better | leaders. | | Our lawmakers make 175k directly in salary and aprox 1 | million dollars for staff and 143k for office expenses. | This is not including the cost of the lifetime pension | they will qualify after only 5 years and lifetime health | plan for themselves and spouse after 10 years in the | house or 8 in the senate. Hint I know they pay I think | 28% of the cost of their gold plan. | | Lifetime a 2 term senator will cost the tax payers near | 18 million dollars in total. | zucked wrote: | I've always wondered about this. These are people who we | elect to do a job - one that we expect and need them to do | well. I wonder what would happen if their base salary was | something higher than current - perhaps $300k. They receive | the maximum healthcare coverages available to the majority | of Americans. Pension is set at $100k/year at retirement, | no strings attached. | | BUT - In exchange, you'd have to agree to some very | restrictive governance while in office. Example: | | - No trading of specific investment vehicles, you may | invest a maximum of ($x) per year in the following options | (ETF, Treasuries, etc.). This goes for any immediate family | members. | | - Congressperson's income can only consist of the US | Government salaries. Any income from previous book deals, | consulting, etc, must go into a blind trust that can only | invest in the aforementioned investment options. | | I wonder if that is enough of an incentive to still attract | sharp minds while perhaps incentivizing them to work more | for the people and less for themselves. | bosie wrote: | you sure you meant top 5%? US congress is already easily in | the top 5% of salaries | slaymaker1907 wrote: | That doesn't really solve the problem because how do we make | them become monks? We already have a blueprint on how to hold | them accountable: hold them to the same standard as those | working in financial services with access to PII. Essentially | make it impossible for them to be active traders; they can | even still invest in ETFs and hands off advisors/roboadvisors | like Betterment. | pishpash wrote: | Even then, do you want people who are incentivized to pump- | and-dump the macro market during their term? You'd almost | need to enforce this for 10 years or more, even if it goes | beyond their term. | skapadia wrote: | I've had a similar thought on many occasions, but even then, | they will find alternative ways to acquire wealth and power. | The clergy of many religions, in aggregate, have a lot of | wealth and power, even if the wealth is not directly in their | name. | | No system can prevent humans from exercising their basic | instincts, emotions, urges, needs, and wants. | passerby1 wrote: | In my opinion the only thing stops that is the fear of | punishment. | | But then the initial question arises: how to prove that | there was a broken law in gaining more wealth/power (by | chance vs intentionally). | | It feels like this question was asked for thousands of | years. | jimbob45 wrote: | Pragmatically? Make such a proposal go viral and delay its | enforcement for 6 years so that current senators don't feel the | heat until it's too late. | anonymouswacker wrote: | Since the media and intelligence agencies are great at | vilifying any dissent (see "Capitol Riot" and how difficult it | is for them to even get representation), there is no hope. The | US is not going to get better as corruption is rampant and most | are in the dark or powerless. Politicians like Bernie Sanders | give hope, but they are few and far between, and muzzled. | Perhaps the migration away from centralized news sources that | are filtered by advertisers & intelligence agencies (see | Manufacture of Consent) could help move us towards actually | having information in the mainstream so that we can have a say, | since our election system is rigged by the two right-wing | parties, but there are too many decision makers still reading | NYT and WSJ. Social media is clamping down on "fake news". The | majority in the House/Senate are trying to push censorship for | this reason, and now they are even trying to change the | judicial branch to suit their whims. | cassepipe wrote: | Well the Capitol riots were not just any dissent. They were | the gathering of a mob of people with crazy conspiracy | theories (that very probably would not even agree with each | other) as part of mediatic stunt (just not "the media") to | give legitimacy to the claim the election had been stolen so | the Republican party could suck up more money from its base | for "the cause". I have myself much respect for Bernie | Sanders and people fighting for more democracy and more | equality please, please don't put them in the same bag than | people being manipulated into giving time and money for | imaginary causes. | chrisco255 wrote: | > the two right-wing parties | | They are neither left nor right. There is a middle elite | group that exploits politics on either side of the aisle to | maintain power. And that's all it is. And they get filthy | rich, but so too does the CCP which is left-wing. Taking | advantage of power for personal gain is not an exclusive | domain of one wing or the other. At any rate these | oversimplified analogies break down among many lines upon | closer inspection. There are elite insiders and then there's | the rest of us. | maxwell wrote: | Constitutional amendment? | gumby wrote: | That's a very blunt instrument and difficult to get the | wording correct. | throwaway0a5e wrote: | See also: | | "Infringed" | | "Papers and effects" | | "not delegated to the United States by the Constitution" | | And many others.... | | No matter how clear you are they just ignore it like it's | not there. | mabbo wrote: | And who would be voting on those? | | > An amendment may be proposed and sent to the states for | ratification by either: | | > The U.S. Congress, whenever a two-thirds majority in both | the Senate and the House of Representatives deem it | necessary; or | | > A national convention, called by Congress for this purpose, | on the application of the legislatures of two-thirds of the | states (34 since 1959). The convention option has never been | used. | | https://en.m.wikipedia.org/wiki/List_of_amendments_to_the_Un. | .. | [deleted] | meepmorp wrote: | Participants in a constitutional convention? | chrisco255 wrote: | The state national convention route is the most likely | route to work if you really want to reign in Congress. | michaelmrose wrote: | How about initiative and referendum in the 26 states that | have such processes and agitating for such processes in the | states that don't. | WhompingWindows wrote: | We have to educate the broader populace about the issue, then | politicians will use the issue to gain political capital, win | elections, and maybe change legislation and practices. | AtlasBarfed wrote: | "No really, how can we force congress to change the rules so | that elected officials can't profit from inside information? | Why would they ever vote for such a bill?" | | Well, those people profiting off of it would have to vote | against each other's interests. | | Money wins elections. Not issues, which are just window | dressing. The media cartels own your attention for all your | waking ours and, as MiB said, while individuals are rational | and sensible, people (that is, the voting electorate) are | easily scared, easily duped, and increasingly easily | controlled. | | So it's not just "vote against being rich", it's also "vote to | lose the next election". | intrepidhero wrote: | If you think insider trading occurred, its already illegal and | should be reported to the Office of Congressional Ethics. | (https://oce.house.gov/learn/citizen-s-guide) | | I'm frankly disturbed that this kind of specific trading by | people in power is going on at all. Salaried federal employees | above a certain level are strongly encouraged to invest only in | generic mutual funds to avoid even the appearance of conflict | of interest. When I look at the above trades I'm not sure | whether anything _technically_ illegal occurred but I 'd | support making _all_ specific trading illegal to avoid even the | appearance of unethical behavior. Higher powers deserve to be | held higher standards. | dmoy wrote: | > When I look at the above trades I'm not sure whether | anything technically illegal occurred but I'd support making | all specific trading illegal to avoid even the appearance of | unethical behavior. | | That sounds like an excellent idea to me. While in office, | can only trade TSP funds, or their rough equivalents outside | of TSP. If you wanna sell something that isn't a giant index | fund? Do it before you take office. | | Then I'd further support that all trading would have to be | done via a 10b5-1 plan, with a blackout window of at least 6 | months. | munk-a wrote: | We elect people who actually believe in governance instead of | people out to make a buck. I know that everyone's going to act | in their own interest (that's sorta how interests are defined) | but some people feel a legitimate duty and loyalty to country | and welfare above their own personal comfort - these people | tend to be torpedoed very early on in US politics because they | refuse to cozy up to special interests to play the campaign | finance game but they do exist. | | It's easy to be a thorough cynic in the modern world, but most | people aren't out to con everyone else when they get the chance | and, if a spotlight is shone on the problem, will respond that | actions should be taken to make things more just. | | Here's an article calling out the stock trading specifically | around Covid treatment drugs with some congressmen and | politicians calling out the behavior: | | https://www.nbcnews.com/politics/congress/aoc-calls-senate-i... | Kranar wrote: | Meh, a lot of the people you're describing are incredibly | incompetent and succumb to simplistic ideologies. Over the | long run they end up in the same position that everyone we're | complaining about ends up in. | | While not entirely related, I remember a study by the U.S. | military during the Vietnam war that said the worst | performing soldiers were the ones who were patriotic and | served due to a sense of duty. I'm simplifying here but the | idea was that those were often the first people to feel a | sense of entitlement and feel as if because they had good | intentions that they were "owed" something. | | Belief in governance is cheap and doesn't do much to solve | anything. Competency, skills, leadership, those are qualities | that result in change... having a good heart and believing in | or trying to execute various altruistic ideologies is | basically a loser's game. | danans wrote: | > Competency, skills, leadership, those are qualities that | result in change... having a good heart and believing in or | trying to execute various altruistic ideologies is | basically a loser's game. | | We should expect elected officials to have both. It's not | like it's impossible. | michaelmrose wrote: | Can you dig up that study please? | munk-a wrote: | I strongly agree it's a loser's game - given our current | political system. People who aren't willing to fight dirty | and compromise their morals will fail since that's where | the money is - and that's sort of my point. We need to | change the system to make it so that these people can | fairly compete by pulling money out of the political system | and evening the playing field. | | I'm also not advocating that blindly loyal idiots should be | in charge - a good comparison to make is to look at more | local governance. On a local level the stakes are much | lower so the money being thrown around is far less - this | lets people get into politics because they want to make | change which is an anomaly at the national level - most of | those politicians are there because it's a career and they | value preserving that over everything else. | | Another decent idea in this direction is term limits but | I'm a bit concerned that that might deprive us of | competency. | whatshisface wrote: | > _Competency, skills, leadership, those are qualities that | result in change... having a good heart and believing in or | trying to execute various altruistic ideologies is | basically a loser 's game._ | | If you are competent, skilled, and a leader, but are not | altruistic, you will end up being a very competent, very | skilled leader of a burglary operation. ;) | partiallypro wrote: | AOC has been silent on Democrats doing similar, which make it | seem like she doesn't really care. | fakedang wrote: | AOC was vociferously calling for the shutdown of Parler on | Twitter, when the protest was coordinated over Facebook and | Twitter too. Imo, she's just a classic Democrat politician | with a louder mouth, enough to rival the Republican mouths. | insert_coin wrote: | We elect people who seek power for the sake of power, and | sometimes pretending to care about others help them acquire | it, and sometimes when the stars align, having to actually | help others helps them keep it. | | > It's easy to be a thorough cynic in the modern world... | | Thanks to politicians it's never been easier! | jackdeansmith wrote: | I feel like a good first step would be requiring that any | assets over some small cutoff be held in a blind trust. It | wouldn't solve all problems, but it sure would solve a lot. | SavantIdiot wrote: | You cannot. As long as there are rigged markets and cadres of | elites, we can truly do nothing. Sad, really. Not helping the | matter is half of the US is below average intelligence and will | elect crooks because they say the right things. | | If only there were more Ron Wydens and AOCs. But you see red | states electing nutjobs who barely have high school degrees | (Boeber) because they shout the loudest. | jimbob45 wrote: | Wyden and AOC enjoy the luxury of not having to worry about | re-election due to residing on extremely blue states. They | would not be so bold if they represented Texas or Florida, | for example. | | The same goes for Republican representatives in highly red | states. | SavantIdiot wrote: | Ah ah, but that is completely circular logic. | | AOC would not represent Texas or Florida because they are | not progressive enough to support her in a landslide, | twice, the way her district did. | | Manchin mealy-mouthed his way into a slight win and has to | be a slimy politician with no backbone because he craves | power. | | The funniest part of your post is that you claim AOC "would | not be bold." Do you even know who she is? She's the | definition of bold. She is doing what she said she would do | and pissing off centrist dems all over the place every day. | | But call me when AOC & Wyden are involved in a scandal, | which is what this entire thread is about. If so, I'll | change my tune, but until then, my original point stands. | mLuby wrote: | > half of the US is below average intelligence | | That is what average means. | SavantIdiot wrote: | /woosh/ | gnopgnip wrote: | Congress already passed the STOCK act, that is why these | disclosures are required, and partially why this kind of | securities fraud is illegal. It is the job of the SEC, and the | justice dept to enforce this | abfan1127 wrote: | trying to stop the trades is the wrong fix. The right fix is | remove their ability to affect markets. Getting to choose | winners and losers will always create opportunity to abuse this | privilege. | mattnewton wrote: | Someone has to wield political power over companies right? I | would rather senators who are restricted from trading than | senators who are restricted from lawmaking that might move a | stock price. | BrianOnHN wrote: | Or get a handle on the wealth inequality that makes the way | we compensate our top elected officials seemingly | insignificant. | Scoundreller wrote: | Maybe we could stop making fun of (the very few) people | using their stimulus checks to buy stocks. | | When I hear that, I'm like, great. Don't bail out | corporations, give people money directly and let them | decide if they want to acquire a stake or not. | BrianOnHN wrote: | > Don't bail out corporations, give people money directly | and let them decide if they want to acquire a stake or | not. | | I haven't thought of it like that, but it makes a lot | more sense than "trickle-down" economics. (Quotes because | of the disgust it triggers) | c22 wrote: | I spent all of the stimulus money I received at local | businesses which have been severely impacted by the | pandemic. Unfortunately none of them offered stock I | could purchase. | | My first instinct was to give it all to a large tech | company in exchange for some marvelous electronic bauble | from China, but that seemed counter-productive after some | deep thought. | gpm wrote: | This is fantasy, the rules by which the country is run | inevitably effects the markets. Raise import taxes, local | manufacturers do better, importers worse. Lower import taxes, | the opposite. Build roads, construction companies and their | supply chains do better. Weaken environmental laws, oil | companies do better. Make it easier to sue for health | damages, personal injury lawyers do better. Fund the | military, defense contractors do better. Etc, etc. | abfan1127 wrote: | look at the trades in the article and how it was impacted | by government. Did they outlaw vaccines or did they | specifically award money to specific companies? | | Further - it will not be reduced to zero. The goal is to | move towards zero. | jrockway wrote: | I disagree with this. The people we elect to govern have to | be able to govern. But, they maybe don't need to have any | business holdings / stock while they're in office. | abfan1127 wrote: | again, the government's role _should_ be protection of | protection of person and property. You 're conflating | "govern" and "control". There are other means to control. | In reality, your goal will never be met because no one is | going to openly step into that scenario and be altruistic, | certainly not all 536 people. | bcrosby95 wrote: | The protection of person and property oftentimes runs | counter to the benefit of a subset of corporations. Given | this, government has to do a balancing act. It's in that | balancing act that lets them enrich themselves - either | through happenstance or on purpose. | c22 wrote: | That's a pretty pessimistic view. Perhaps the individuals | currently filling those roles wouldn't go for it, but it | seems like we might be able to find 536 altruistic | idealists somewhere in America. | jrockway wrote: | I didn't dive deeply into this data, but it doesn't sound | like we even need to find 536 idealists. If you sort by | number of trades descending, it becomes less than mine | very quickly (I buy 4 mutual funds once a month, | automatically). If you sort by value of trades | descending, it looks like there are only a handful of | officials with any meaningful amount of money in the | stock market. (For some value of meaningful; there is an | example in there about a $50,000 trade, and it just | doesn't seem like very much money to me. 50 million | dollars, get out that microscope. $50,000? Doesn't change | anyone's life, so not really worth being corrupt for.) | toomuchtodo wrote: | https://www.politico.com/news/2020/12/18/elizabeth-warren-st... | | https://www.warren.senate.gov/imo/media/doc/Anti-Corruption%... | mabbo wrote: | Great. Now you just need the majority of elected officials to | get behind the bill. | | Note that the house majority leader is also one of the | biggest winner of these rules not existing. | toomuchtodo wrote: | Politics/people is the top of the OSI stack, hence why the | problem must be solved there. | | If you're more comfortable behind an IDE, gotta get | comfortable calling representatives and pounding the | pavement. That leads to where the decisions are made. | alexfromapex wrote: | To start with, there needs to be lots of advocacy for insider | trading investigations | kiliantics wrote: | In the past, the things that ultimately worked were collective | revolts, strikes, sabotage, assassinations. | | I think we need to acknowledge that, in the same way that the | people with the power to stop this are profiting, they are also | the people with the power to change who is in power or how they | get in power. Elections are not effective ways of changing | systemic power structures anymore. Society pretty much needs an | overhaul, especially in the face of serious existential risks | like climate change or looming military conflicts. | slibhb wrote: | Is this not already illegal? | https://en.wikipedia.org/wiki/STOCK_Act | ihsw wrote: | Is it worthwhile to call it illegal when it's not enforced? | adolph wrote: | https://www.npr.org/sections/itsallpolitics/2013/04/16/17749. | .. | slibhb wrote: | > Still, two major elements of the law remain. Insider | trading is illegal, even for members of Congress and the | executive branch. And for those who are covered by the now- | narrower law, disclosures of large stock trades are | required within 45 days. It will just be harder to get to | them. | gowld wrote: | Use the 4 boxes of Liberty | | https://en.wikipedia.org/wiki/Four_boxes_of_liberty | thepete2 wrote: | One thing I've always wondered: Does the stock market basically | consist of insider traders making a profit off of people without | that knowledge? I feel like even with immense restrictions on | insiders in place, information is so easy to pass on to sb. else, | that it should be impossible to prevent this. | | Heck, I could cough once for buy, twice for sell. Who's going to | surveil me and notice that? | op00to wrote: | Yes, literally. | Fat_Thor wrote: | You legalize insider trading for everyone. | RhodoGSA wrote: | for that matter, day trading and technical analysis is | literally just insider trading. This chart, based on some | analysis of the way it's moved, with no interest in the metrics | of the company itself, dictates buy or sell. Every 'Technical | Trader' learns these 'indicators' and trades on them. It's just | shadow insider trading under the guise of providing 'liquidity' | but in reality just contributes to more volatility. | | Back when the stock market was founded, it was meant as a means | of providing a signal of support for a company. It allowed the | company to raise debt or financing based on it's stock price or | signal of support. You bought company stock because you | believed in the fundamentals of the business and you wanted to | support it. Now it's just about how i can sell this stock to | the bigger sucker, for more money than i bought it for. | kyleblarson wrote: | How else is Pelosi expected to afford her $20k sub z fridges | filled with 13 dollar a pint ice cream? | ModernMech wrote: | I'm not saying Pelosi isn't fabulously wealthy, nor that she | isn't engaged in activities which are unethical to enrich | herself; but her fridge and ice cream are not evidence of this. | The Speaker of the House makes a quarter million dollars per | year. That's more than enough to afford such luxuries. | | https://pressgallery.house.gov/member-data/salaries | thelean12 wrote: | If she only made the 250k, she'd be spending like 12.5% of | her yearly take home pay on a fridge. That seems like a | little much. | | ($250k is like $160k take home with her home town taxes. | 20/160 = 0.125) | ModernMech wrote: | For something designed to last multiple years, why not? I | can look in my garage and kitchen at things I've spent | 12.5% of my take home on that I expected to last a decade, | including my refrigerator. I _do not_ like Nancy Pelosi, | but this criticism always seemed like quite a stretch to | me. | hmsimha wrote: | This conclusion in particular is probably something that I've | assumed in the past: | | > On a whole, Democrats seem to love tech and Republicans seem to | love oil and gas. | | But I hadn't really thought about the wide-reaching implications | until now; perhaps its more than a coincidence that the current | cryptocurrency bull run really took off shortly after Biden won | the presidential election. | WaitWaitWha wrote: | I have a better solution than all these "let's restrict", "let's | demand pre-trade disclosure", etc. | | _Term limit them_. | | 12 years total Congress in lifetime. That is two full Senate or | six House, or combination thereof. | | The longer a politician (or bureaucrat) is in a position, the | more power they accumulate and the likelihood to forget the | purpose of their role. | ProjectBarks wrote: | I am curious why unusual whales did not compare performance to | market performance over set periods. I looked around for some | papers and was unable to find anything recent. CATO published a | report showing there is weak performance difference between | senators and their stock portfolio [1]. | | If they are outperforming this should 100% be remedied but I'd be | open if anyone has comments that would contradict this report? | | [1] https://www.cato.org/research-briefs-economic- | policy/relief-... | paulpauper wrote: | he is selling a subscription. if it actually worked as well as | he purports he would do it himself. way easier to collect | recurring subs from gullible ppl. | genericone wrote: | Where are they aggregating all this insider data from? Is there | an index of stocks being traded by government insiders and | officials that can be tracked in real-time? | dvaun wrote: | The Office of the Clerk of the House has a page for downloading | Zip files of annual data[0]. | | If you take the DocID from the XML or TXT files in those sets | you can send a request to: https://disclosures- | clerk.house.gov/public_disc/<doctype>-pdfs/<year>/<docid>.pdf | | - <doctype> works for the values "ptr" and "financial" | | - <year> self-explanatory | | - <docid> the DocID from the entries in the XML or TXT files | | Example: Nancy Pelosi disclosure/filing on 2021-04-09[1] | | [0]: https://disclosures- | clerk.house.gov/PublicDisclosure/Financi... | | [1]: https://disclosures-clerk.house.gov/public_disc/ptr- | pdfs/202... | | This would be fun to play around with. I wonder if there's a | better endpoint to source this from? | adolph wrote: | If you are using Python, this is an approach to get PDF | tables into Pandas dataframes. | | https://towardsdatascience.com/how-to-extract-tables-from- | pd... | CameronNemo wrote: | Real time? No. The legislators have to report their trades a | couple months after they make them, IIRC. | monkeybutton wrote: | That's unfortunate; If was real time a copycat investment | strategy would work, right? | delecti wrote: | IIRC, the same law that requires them to report their | trades makes it illegal to use that data to profit. | weird-eye-issue wrote: | There is no way it would be illegal to trade based on | their disclosures | greenshackle2 wrote: | tl;dr yes but you would probably get beaten to the punch by | high frequency traders, and risk being exploited by the | discloser. | | If you had sneaky exclusive access to their trading flow in | real time then yeah sure you could copy them and get the | benefits of insider trading. (And you might be guilty of | insider trading yourself? I'm not sure how the law works.) | | If _everyone_ knows Alice is doing insider trading and | knows her trades, then when Alice buys X at $10.00, there | will probably be other copycats piling into X and driving | its price up, so you won 't be able to get the same price | as Alice, unless you're faster than everyone else. | | Since you don't know what the actual inside information is, | you don't know if it's still worth it to buy at $10.20, | $10.30, etc. Maybe the inside info was only slightly better | than expected earnings and the price end up being only | $10.05. | | This is somewhat exploitable by Alice, she doesn't need | insider information anymore, she just has to buy random | stock Z and disclose it, watch copycats pile into Z and | drive its price up, then sell it back at a higher price. | alfl wrote: | Scanning the data in the linked article [0], most trades are | reported within a week, usually only a few days, some same | day. | | [0]: https://unusualwhales.com/i_am_the_senate/data | weird-eye-issue wrote: | It talks about that pretty high up on the site that is linked. | Just go read it. | ceejayoz wrote: | > Like the US Senate, elected members in the US House of | Representatives must disclose financial activity they or their | spouse or their dependent children conduct while in office. | These financial disclosures can be found here. | | https://unusualwhales.com/i_am_the_senate/data | | Looks like the report gets filed shortly after the trade. | sakopov wrote: | If I had to guess I'd say they're probably using EDGAR - | https://www.sec.gov/edgar | Scoundreller wrote: | Take a trip to 1995 and check out what we use in Canada: | SEDAR: | | https://www.sedar.com/ | LB232323 wrote: | This is a really greasy website. | | It's not the cheesy logo or the fact that they are ripping off | other fintech companies, it's that they are selling get rich | quick dreams like a scam artist. | | This article is really an advertisement for their services and | it's surprising that it went viral here. They are basically | encouraging people to try and cash in on criminal financial | activity in congress. | | I can't put my trust in this site. | Thorentis wrote: | Those evil republicans and their greedy capitalist agenda! Oh | wait, both sides do this? Wait, the Democrats do it more? | barbazoo wrote: | Love that data this is making public but I wish it wasn't always | so much blue vs red, Republicans vs Democrats, who is worse, my | team or theirs. They're all corrupt to some degree, why make it | even more partisan that it already is. | nocommentguy wrote: | Yeah but their side actually is much more corrupt. No | whataboutism! /s | | (How does this comment contribute to the discussion? It | preempts long partisan threads that derail the conversation | which always get kicked off when someone points out it's all | rotten). | mattnewton wrote: | I hope the intent was to show this is not necessarily a | partisan issue, representatives on both sides of the aisle are | clearly engaging in suspiciously successful trades. | christiansakai wrote: | Meanwhile ordinary people still believe that the war is against | their fellow people, in identity politics, religion, sexual | orientation etc. Devide et Impera. | giantg2 wrote: | That's because it's the only war they even have a chance at | winning because people in power will at least use them as pawns | in their shared interests. They realize they lost the other war | long ago and are subjects, not citizens in regards to holding | the system itself accountable. Or are in blissful ignorance | because it hasn't screwed them... yet. | reedjosh wrote: | > They realize they lost the other war long ago | | No, I vote ignorance. Most people don't even realize the | current global political landscape is a battle of systems | (E.g. Rules Based and China's Belt and Road Initiative). | | The idea that we're pawns doesn't cross most people's minds. | Though I'd agree it may be willful ignorance as the truth not | only hurts but is scary. | giantg2 wrote: | "The idea that we're pawns doesn't cross most people's | minds." | | Maybe. The fact that two of us here are even discussing it | is something. I know quite a few people who feel this way. | But it does usually take at least the witnessing of a | blatant violation. | reedjosh wrote: | I think for me it was just the shear lack of change no | matter which politician was in office. From there I | started looking for why. | | At some point I also realized advertisements are purely | bribes meant to shackle speech. Once I abandoned ad- | funded media, my learning really took off. | SMAAART wrote: | Not bad! I wish we could have that info in real time! | docflabby wrote: | Only way to consistently outperform the market is lobbying, | insider trading or fraud (see Madoff) | vmception wrote: | Don't forget about issuing your own stock and bonds. | | I personally consider that part of my own portfolio. No par | value, sold at a higher price. | kipchak wrote: | Does anyone use this info for their own trading, particularly the | $300 a year plan? You would figure if there's insider trading | going on to be watched your performance copying their trades | should be pretty good as well. | Ansil849 wrote: | Conflicts of interest with politicians are unfortunately nothing | new. Remember several years ago when Pelosi's husband owned Visa | stock, while Pelosi was involved in legislation that - had it | gone forward, which it did not - would adversely impact Visa? | | https://www.politico.com/news/stories/1111/67593_Page2.html | BrianOnHN wrote: | Similar from yesterday: | https://news.ycombinator.com/item?id=26807695 | | HN can't see the forest for the trees. | | Trading isn't the issue. | | Why are our top elected officials not compensated enough? Income | inequality. If it isn't trading, they'll chase Bezos until they | "get what they deserve" one way or another. | michaelmrose wrote: | Our top officials are compensated to the tune of 174,000 which | is 95th percentile. Making people wealthier doesn't make them | more honest. | mattnewton wrote: | Honestly some of these trades also seemed small to me; anyone | can make a trade that's up 30% in a year with public | information - they can also easily lose as much. It is only | problematic when they consistently win by large percentages on | the majority of their trades, and this doesn't appear to do | that kind of statistical analysis of average returns? | BrianOnHN wrote: | > this doesn't appear to do that kind of statistical analysis | of average returns? | | Exactly, and you had to be really unlucky not to have | significant returns over the past year. | | Has anyone looked at their managed retirement find lately? I | wouldn't be surprised if you see 30% even in a medium-risk | fund. | the_optimist wrote: | Your theory: If you pay Pelosi more, she'll stop insider | trading. On top of her +$100M net worth, where her salary pales | in comparison to trading gains. You just have to pay people | more so they stop abusing the system. | | Found the Congressperson here. | sakopov wrote: | Are you saying that these insane leveraged trades won't be | happening if elected officials are compensated more? That is a | preposterous assumption! You're right, trading isn't the issue. | Greed and abuse of power are, however. | unholiness wrote: | A lot of justified negativity in this thread. | | On the flip side, are there any congresspeople who have publicly | put all their assets in a blind trust? Any who have advanced | bills requiring this of their colleagues? | | The solution to problems like this is elections, and you would | think "My opponent is insider trading while I literally can't" | would make a great campaign ad. | sakopov wrote: | > For example, Pelosi in Dec 22 was against more stimulus. Her | husband buys deep ITM TSLA and AAPL calls that day. December | 23rd, she is suddenly for stimulus again, with those same | companies ralling 5%, giving her an instant +30 return. | | > Congressman Gottheimer is absolutely an incredible options | trader. He's been selling calls at peaks on $MSFT all 2021, & | seemingly buying back the contracts on dips. This in blocks of | $250,000 - $5,000,000, which is incredible size given the amount | of $MSFT shares he owns. For ex, on 02-12 he sold 500k $MSFT $160 | strike expiring 06/18/2021. On that same day, he bought deep ITM | calls of $1M-5M at $145 expiring 03/19/2021. The whale caught | both of his movements as well. | | This is fucking unreal. | mattferderer wrote: | I would like more oversight here but I don't know if these are | great examples. I do (without evidence) believe a lot of these | people use insider information. | | Pelosi's husband has been very bullish for a long time on | Tesla, Apple & tech in general I do believe. | | Gottheimer did what I think is a Bull Call spread which means | in February, after a crazy run up in market prices in January, | he bet that MSFT would go up a little more but would eventually | come back down or at least trade sideways & not go over $160 by | 6/18. If he sold his ITM calls before March or in early March, | he probably did good. If he held on to them until closer to the | 19th, he might have got crushed. This doesn't say when he sold. | A lot of people argued stocks were overbought after January. | Also, if he owns a large share of MSFT it's common to sell | calls when you want to keep your shares but think the price is | at the top or there is a lot of volatility that will soon go | away. It's a way to earn some income without selling. | | - None of this is financial advice & I'm fairly ignorant on | this topic. | maest wrote: | unusualwhales are incentivised to talk their own book so it's | safe to assume they've cherry picked these examples. | | The honest way to see if politicians get an outsized return | from this type of trading is to run a backtest, with | appropriate hedges where you buy whenever anyone buys and | sell whenever anyone sells and hold for a medium amount of | time (3-6 weeks seems reasonable). unusualwhales know this so | the fact that this sort of analysis is missing is telling. In | particular, note how they provide stats for what the trading | trends are, but not for the outsized performance. | | The charts at the end of the article are a lot less | impressive and they don't obviously look better than random. | guiriduro wrote: | In addition to possibly using inside information, they also | make the news, ie. potentially profit from policy news that | they themselves are making. | itsoktocry wrote: | > _Pelosi 's husband has been very bullish for a long time on | Tesla, Apple & tech in general I do believe._ | | I'm curious where you are reading about Paul Pelosi's stock | picks. Regardless, so what? He has no business owning and/or | trading shares of companies the person he shares a bed with | has influence over. | mattferderer wrote: | His name comes up often enough in Finance News Headlines. | He makes large transactions. Nancy's office has to file | those, so they make great headlines. A quick search should | give you thousands of them. | | I have no position on your 2nd sentence. I agree in | philosophy but acknowledge the details are complicated. | pc86 wrote: | Does Nancy Pelosi have influence over Tesla? | | Even if you take a pretty hard-line attitude about members | of Congress being prohibited from doing things like trading | their own portfolios, it's hard to make a cogent argument | that Paul Pelosi, who is by all measures a private citizen, | should be restricted from trading specific stocks. | Joker_vD wrote: | Well, when the order of events is "A committee which Pelosi | is member of is discussing the large contract on the VR | helmets for the military -- Pelosi's husband buys MSFT -- The | committee anounces that the contract goes to MSFT -- MSFT | stock rises", and the pattern keeps repeating, it _is_ | evidence, albeit circumstantial. | throwaway5752 wrote: | Seriously, I am very serious about preventing conflicts of | interest and insider trading. But Microsoft is a terrible | example, they are extremely diversified. The contract was | announced 3/31 and it's obvious that it had no particular | impact on its share price since that date when looking at | its peers: https://www.google.com/finance/quote/MSFT:NASDAQ | ?comparison=... | pc86 wrote: | It went from approximately $235 to $250, which is about | 6%. On calls, especially short-dated ones, that can | easily be a 40-50% gain. I've got a number of different | MSFT LEAPS in my portfolio and they all went up 15%+ on | that news. | jonhohle wrote: | That seems like the definition of material, non-public | information. In the past I don't think Congress was bound | to the same trading rules as the general public (blech), | but last I checked, Mr. Pelosi is not in Congress. | TheCoelacanth wrote: | Congress is bound by the same rules as the general | public, they just aren't legally insiders. | | Insider trading requires not only material, non-public | but also some kind of duty of confidentiality to the | company you are trading. | | Congress doesn't have that type of relationship, so they | are not insiders. Their spouses aren't either. | | There are some additional rules that apply to people who | gain knowledge in an official capacity[1], but these were | enacted fairly recently and haven't been effective at | keeping Congress from trading using the non-public | information that they receive. | | [1] https://en.wikipedia.org/wiki/STOCK_Act | tomcam wrote: | Well they aren't legally insiders because... they made | the rules. | TheCoelacanth wrote: | Not really, they aren't insiders because when courts | interpreted the rather vague laws against fraud in the | context of securities trading, they didn't interpret | Congress trading based on knowledge received in their job | as fraud. | jonhohle wrote: | This falls under misappropriation which does not require | the reader to any relationship to the company being | traded, only material, non-public information. | TheCoelacanth wrote: | I'm not aware of any case law finding that Congress using | their knowledge is misappropriation. Do you have any | examples to the contrary? | goatinaboat wrote: | _This is fucking unreal._ | | How do you think so many people on government salaries become | super rich, whilst supposedly working for the government? | gadders wrote: | I don't know if specific trades are sketchy or legit, but I do | think there should be some sort of log of net worth when you | join congress, senate, houses of parliament etc and politicians | be expected to explain any large gains over their time in | office. | [deleted] | chris11 wrote: | My employer has 105b plans available if you want to trade | outside of trading windows. I think we should have something | like that for politicians. Insider trading would be less of | an issue if politicians and spouses were required to publicly | announce trades 30-90 days before they were made. I don't | think that would impact long term trading strategies, and I | think it's reasonable to ask politicians to give up short | term trading. | chrisbolt wrote: | Like https://www.opensecrets.org/personal-finances ? | giantg2 wrote: | Frankly, it's insider trading and should be | restricted/prosecuted as such. | tgb wrote: | I think the insider trading aspects of this are the lesser | concern. There's substantial debate over whether insider | trading is actually a net negative for society or whether | it makes sense to regulate, surprisingly. [1] | | The primary concern here is whether or not this influences | their decisions when it comes to governing, whether they | choose the option that is most profitable rather than best | for their country. | | [1] https://en.wikipedia.org/wiki/Insider_trading#Arguments | _for_... | fighterpilot wrote: | There will almost always be plausible deniability. Needs to | be banned. | giantg2 wrote: | I think the insider trading laws don't require motive - | just that they had private information or used their | position of influence and that they benefited from a | related trade. The rules for executives at companies | usually requires them to file any trade plans related to | their company stock prior to actually making the trade, | which would at least prevent the short term plays like | the Pelosi example. Even tech people at trading companies | are subject to restrictions in what they can trade, even | if they aren't looking at the financial data. | JumpCrisscross wrote: | Stupid insider trading, where someone gets a tip and then | trades on it, is well enforced. It's easy to catch _ex | post facto_ and the people doing it are generally of the | mind that everyone is insider trading and so they 're | unlikely to get caught. | | The problem is in the grey areas. Take the Pelosi | example. The material nonpublic information was her | personal policy position. Assuming she acted purely | venally, are your own intentions insider information? If | I know I'm going to get Chipotle for lunch tomorrow, is | it insider trading to buy Chipotle shares? | | If, on the other hand, her husband took a conversation he | had with her about policy and then traded on it, _that_ | would be insider trading. Unless they did it over text | message, however, the odds of proving it are zilch. | giantg2 wrote: | "personal policy position" | | Once she announces it in the media, wouldn't it be a | professional policy opinion? CEOs are similar. They can | believe what they want, but what they say to the media | can be punished (like Elon was). The real sticking point | is how is she of one opinion then flip to the complete | opposite the next day without giving a reason. If they | have to report their intended trades then it could avoid | this short term play. | | Spouses and household members are held to the same | restrictions as the regulated individual, regardless of | the conversation or not. The only reason it's hard to | prove is because they are in a position of power. The SEC | would jump on any normal people doing the same thing. | fighterpilot wrote: | Regarding the Pelosi example, it's even worse than what | was suggested above. The TSLA trade was placed a few days | before Biden came out and said they planned to buy EVs | for government vehicles, which was an announcement that | directly caused TSLA to spike up the second it was | broadcast to the market. | | Again though there's plausible deniability, as you say. | It needs to just be outright banned. | koube wrote: | Dec 22 democrats had reached an agreement to provide $600 in | stimulus, this was an agreement that had buy in and should have | been pushed forward. | | Dec 23 Trump announced support for a $2000 stimulus, changing | the political calculus, in favor of democrats, who did | eventually push through the remaining $1400 in a separate | package. | | Pelosi's strategic change is not a change that happened in a | vacuum. Trump's announcement was all over the news and was the | single most important event in the political world that day, | not Pelosi's husband buying calls. Contextualizing this event | around Pelosi's husband is misleading. | | Ok downvote my comment all you want but this is well documented | and was less than 6 months ago, and frankly it's surprising | that people forgot how impactful this event was. People are | still criticizing Biden over the additional check being 1400 | instead of 2000. | lordnacho wrote: | As a member of Congress she has much better colour on what's | about to happen than everyone else. She can basically count | up the votes before before anyone else. | | I'd rather live in a world where reps are squeaky clean. It's | much better than one where we make up some rules where people | who come right up to the line end up smelling bad, and then | everyone is born complaining about the corruption and | enduring it with no recourse. | | Ultimately it's a rules vs discretion (aka judgement) | question. | koube wrote: | Ok yes she did count the votes, determine that this was the | highest number that could be negotiated, and then she | worked to push the bill forward as she should have. And | then the president tweeted out of nowhere which changed | things. Trump's unpredictability is well known for anyone | who has read the news at least once in the past five years. | All of this is above board. What do you want her to do? | Forget all of her policy goals and act against all of her | stated interests because her husband bought calls the | previous day? | | I don't know if you remember, but the amount of stimulus | remained 600, so Pelosi was on money on what was | politically possible. The remaining 1400 only was possible | after the slimmest of senate majorities after the Georgia | runoffs. | lordnacho wrote: | I'd want her to not speculate on the event, it looks bad. | The system doesn't just depend on people not cheating, it | depends on confidence in the system, judged by people who | aren't experts in either trading or politics. | koube wrote: | What did she do here that constitutes speculation? All | she did was push for the highest stimulus she could get. | gowld wrote: | Her husband, who is her legal business partner, should | not be trading at all. It's just that simple. They should | buy long-term bonds. | wpietri wrote: | Whatever the behind-the-scenes truth, I think the appearance of | conflicting interests is a problem regardless. For a lot of | elected offices and high public service positions, I think | their wealth should be put into a blind trust, one constrained | by law to buy broad, boring things like index funds. | | That would surely be a problem for some individuals. But I | don't think it's a systemic problem. We only need to find | 0.00013% of the US population to fill the Senate and House | together; surely there are that many people who are both | competent and willing to put the public interest ahead of their | own. | sneak wrote: | I think this presupposes the lie that the government is by, | of, or for the (majority of the) people. | | This is a closed system, and most are not allowed anywhere | near the control room. | | It, including these trades, is working as intended. | munk-a wrote: | > It, including these trades, is working as intended. | | You can view the US in a lot of cynical ways but it was not | created as a vehicle to allow the wealthy to continue to | gain wealth at the expense of the poor. Insider trading | between congressmen using their posts to fleece the public | was never an intent of the government. | jessaustin wrote: | That is precisely the reason that Madison and his | collaborators wrote the constitution (with debates kept | secret from the public). The nation already had popular | rule and a federal organization in 1781. The problem for | the rich was that state legislatures kept helping out the | majority of their voters, changing various rules about | repayment of debts and so on. The constitution put an end | to all that, as it was intended to do. | jhallenworld wrote: | It was at least created for them to at least preserve | their wealth. In the debates leading up the creation of | the Senate, here is a typical argument: | | "...our government ought to secure the permanent | interests of the country against innovation. Landholders | ought to have a share in the government, to support these | invaluable interests and to balance and check the other. | They ought to be so constituted as to protect the | minority of the opulent against the majority. The senate, | therefore, ought to be this body; and to answer these | purposes, they ought to have permanency and stability. | Various have been the propositions; but my opinion is, | the longer they continue in office, the better will these | views be answered" | | https://founders.archives.gov/documents/Madison/01-10-02- | 004... | triceratops wrote: | > it was not created as a vehicle to allow the wealthy to | continue to gain wealth at the expense of the poor | | I mean the American revolution was spearheaded by wealthy | land and slave owners who were tired of taxes. | smt88 wrote: | The US is explicitly not about the majority. The Senate and | Presidency are both anti-democratic institions where land | controls votes. | snarf21 wrote: | I agree that _ALL_ government employees, their spouses and | companies should own no individual stocks until they leave | office /job. However, the politicians are just the tip of the | iceberg in regards to the rigged game of Wall Street. We have | bigger fish to fry but no one seems to like fish anymore. | hyperpape wrote: | I agree in spirit, but this is overbroad. The various | branches of government employ millions of people. A cop, or | VHA nurse, or my friend who works a non-managerial role at | the EPA can own stock. It's the decision-makers who were | should be concerned about. That group extends beyond | congress, but doesn't contain literally every government | employee. | delusional wrote: | I don't think normal middle class government workers owning | stocks is a real problem. I get where you're coming from | (technically they could have inside information), but it's | not nearly as impaction as the elected officials having | very large swings hinge on their own policies. | smt88 wrote: | I think it's easy to rephrase this as follows: | | People should not be able to make bets on matters over which | they secretly control the outcome. | | That means any federal official should have their investments | behind a blind trust of some sort, no exceptions. | Jommi wrote: | Edit it to "secret bets" or even "non publicly announced". | smt88 wrote: | I'd have to think it through more, but my gut says that I | don't care if the _bet_ is secret. Although I would | separately support a law that all elected officials must | have extreme transparency into their finances. | | I think people should give up all of their right to | privacy (when it comes to business, finances, travel, and | even conversations) when they acquire a large amount of | power. In my head, a US senator would have that much | power and that little privacy, whereas a US | representative in the House would not. | paulryanrogers wrote: | Isn't this already an illegal conflict of interest? | | Are federal representatives immune? | infinite8s wrote: | Congress excluded itself from insider-trading laws. | Convenient, eh? | _underfl0w_ wrote: | Can anyone cite a source for this? I don't doubt the | legitimacy, but would like to know more about it. | vageli wrote: | It doesn't seem to be true any longer with the STOCK act. | | https://en.wikipedia.org/wiki/STOCK_Act | nitrogen wrote: | _We only need to find 0.00013% of the US population_ | | Maybe we should use sortition then instead of elections? What | could be more democratic than random average people (meeting | some criteria) taking a turn at the wheel? | slowmovintarget wrote: | A significant percentage of random average people have no | practical understanding of economics, and no ability to | think of consequences to policy. | | Granted, neither do a significant percentage of the | currently serving congress if current policy is anything to | go by. | voldacar wrote: | > A significant percentage of random average people have | no practical understanding of economics, and no ability | to think of consequences to policy. | | unfortunately, this is also true of our elected officials | kelnos wrote: | > _Granted, neither do a significant percentage of the | currently serving congress if current policy is anything | to go by._ | | I think they understand just fine, most of the time, but | are more interested in enriching themselves and their | cronies than looking out for their constituents or the | health of the system as a whole. | frankfrankfrank wrote: | Regardless of whether one may like the initial selection | criteria or not, what you describe is precisely why the | country (USA) was supposed to be led by land owning free | white men. The assumption being that people that fit that | criteria, plausibly possessed a requisite initial | selection criteria set of skills and knowledge that would | constitute the pool of best qualified people to run a | government in the common interest. From that pool of | people their peers would further select amongst each | other using those very same abilities, knowledge, skills, | and capacities to further choose the utmost best person | to lead. | | I realize that just saying that may cause some | consternation among some, but it is objectively the best | selection system one could possibly devise, for any | people anywhere, regardless of whether people like it or | not. | | It's not even a selection system that is not used all | over the place from choices within your family where | there are certain prerequisites like being an adult or a | parent or having to be a member of the union in order to | vote on union matters, or having achieved certain | certifications and qualifications before you can make | decisions about building a highway bridge. | | It is and has not been a net benefit to any of us that | "democracy" was first imposed and then expanded when the | founders of the USA were very explicit about the fact | that democracy was a recipe for disaster and would | invariably cause destruction ... as it has. Personally, I | would very much have been ok with benefitting from | properly qualified people making decision for me that I | have no competent capacity to make for myself, rather | than having lived in a society where everyone thinks they | are equally smart and competent and my vote counts the | same as some fool who does not know that a week is seven | days (something I heard someone in her early 20s say | yesterday. She thought the week excludes the weekend) | spoonjim wrote: | The destruction to the Founder's political vision didn't | come from expanding the franchise, it came direct | democracy. The idea was explicitly that the average voter | was completely unqualified to choose the President, and | that the only question the voter would be asked is: "Who | in your town should make decisions for you?" That person | would go to your state legislature, which would vote for | your state's electors, who would go and deliberatively | decide the President. | dysrend wrote: | Democracy[?]republic | | The career politicians, intelligencia, and c-suite | technocrats have been running shit for the past half | century or more - you see where it's gotten us, to the | _ruin_ you describe. | rocqua wrote: | > Regardless of whether one may like the initial | selection criteria or not, what you describe is precisely | why the country (USA) was supposed to be led by land | owning free white men. | | > I realize that just saying that may cause some | consternation among some, but it is objectively the best | selection system one could possibly devise | | Combining these two statements suggests that you would | advocate for white supremacy. Is that a correct deduction | of mine? I would rather ask than just jump to | conclusions. | _underfl0w_ wrote: | > but it is objectively the best selection system one | could possibly devise | | Your determination of objectivity seems a little... | subjective. | | Maybe this was objectively best _at the time_ but at | minimum the race part seems to no longer be true. | Red_Leaves_Flyy wrote: | What about both? | | Take the existing system and have the house and Senate | argue every official act to the sortition for a vote. How | would this be worse than the current crony capitalism we | suffer under? | rocqua wrote: | Perhaps have a third stage (after the senate) that is the | sortition that has to approve a bill. | sneeze-slayer wrote: | Hah, Philip K. Dick explored this a bit in "Solar Lottery." | In the book it's a bit absurd, but still an interesting | take on a "randomized" government. | rootusrootus wrote: | I agree, I have long thought sortition might be the right | answer. Right along with leveraging modern technology to | reset our representative-to-citizen ratio to something like | the constitution originally prescribed. | [deleted] | rocqua wrote: | The thing is, the last few times I recall when some have | tried more direct democracy (Brexit, a few referenda in | europe, california ballot measures) it seems to lead to | decisions that seem rather sub-optimal. I am not sure the | random citizen might actually be better at governing that | a professional politician. | dkarl wrote: | I think random people would either be shallow and selfish | about it or be so intimidated by their responsibilities | that they would be at the mercy of knowledgable advisors | chosen from the same small class of people who run the | government now. | psychlops wrote: | Just require them to announce their trades publicly 24 hours | in advance. And let them manage their own finances. All these | shenanigan's would disappear. | gibolt wrote: | That doesn't work. If they are aware of a huge non-public | deal, the market may react based on their trade, but not | nearly as much as when the deal goes public. | psychlops wrote: | It would help. There are already funds that track the | money of politicians and invest accordingly. If they | submitted a large options trade, the funds would front | run them and take away much of the profit. | ed_balls wrote: | Their children or other family would do the deals. | m463 wrote: | If I was a foreign government, I would just monitor these | announcements and impoverish the US politicians. | gowld wrote: | Good. That will discourage them from manipulating the | market. | | No need for foreign government -- the whole world can do | it. | BurningFrog wrote: | If I was a foreign government, I would want to enrich US | politicians, so they became favorable to my causes. | throwawaygh wrote: | Why not just prohibit members of Congress of owning stock? | They are some of the most powerful people in the world. Why | is it so much to ask that a Senator or especially | Representative serving in the most powerful legislative | body in the world just take a cash position for 2-6 years? | FabHK wrote: | I think it would be perfectly fine to let them have their | money in broad index fund, or maybe an actively managed | fund which should also be open to every citizen. Allow | withdrawals etc. only once a month or so to avoid market | timing. | klyrs wrote: | I fully agree, and I'd like to extend it to their | families as well. But... you ask "why not" and the simple | reason is that only they could enact such a law. And even | when the laws are in place -- Trump ran roughshod over | the foreign emoluments clause, and there were zero | consequences. Why would the richest and most powerful | Democrats set such a precedent, only to have it turned | around when they're in power and stand to profit? | somethoughts wrote: | Yes - it definitely seems like it should be more or a | "let's hope we can see both" type thing rather than an | "either or type" thing. I think publicizing existing | holdings is huge in that it can be done based on existing | data sets as unusualwhale has shown and it is something | that "we the people" can do, today - perhaps just by | sharing this article. | | Eradicating politicians doing insider trading is a much | longer slog that we are mostly just hoping "those with | the power" will enact against their own self interests. | diebeforei485 wrote: | I agree. Their wealth should be in a blind trust (unless | they run the company or farm or whatever). | frankfrankfrank wrote: | I am not at all opposed to this strategy either, but as | you seem to imply, it would really need to be hardened | against other corruption and schemes like that the blind | trust has to be run by the same government office. | | It is why I like the fact that they just have to announce | their stock trades ahead of time, it still allows them | autonomy, but also there is no sense in front running | them if they are not trading on insider knowledge. Their | performance should essentially be in line with the | market, not like Mr. Gottheimer that seems to have | tripled his net worth in FY2020. | godelski wrote: | Because investments are still a great way to hold your | savings. The problem here isn't that they have | investments (e.g. a 401k), it is that they are acting on | insider information. Which is illegal to everyone else. | At _minimum_ they should be held to the same standards. | Though I think most people agree that they should be held | to _higher_ standards, which gives suggestions like a | blind trust. And obviously strict rules of if they break | the blind part that they get jail time. | dan-robertson wrote: | It's not insider information. You might consider it | material non-public information, which you can't trade on | in Europe, but in the US insider trading has a much more | narrow definition: roughly it has to come from the | insiders of the company. If your friend at Microsoft | tells you that they won some massive contract, you can't | trade on it. If you overhear that news in a cafe, you | can. If your friend at the government tells you they're | going to agree on a big contract with Microsoft, I don't | know if you'd be allowed or not but if you weren't | allowed I don't think it would be insider trading. | | Anyway, that obviously isn't legal advice. And I agree | that people should expect legislators to act with high | integrity, but that's not really how they vote. | BurningFrog wrote: | Honest question: If I work at Microsoft and I know we'll | launch a product that will kill competitor X, am I | allowed to short the X stock? | | That more analogous to the politician trading. They _do_ | have inside information, but it 's not from inside the | company they're trading. | BurningFrog wrote: | Too harsh. A blind trust would be quite enough. | efitz wrote: | I oppose this idea simply because most people's' | retirement is held in investments now; I even think that | congressional pensions have been dialed way back IIRC. I | much prefer the "notify publicly well in advance" | approach. | jkepler wrote: | I think they're too aware that with real dollar inflation | probably running at least 10% per year (per Michael | Saylor), they'd loose too much value for them to consent | to holding only cash for 2 to 6 years. For every $100K | they had, they'd end up holding something near $81K down | to $53K in real purchasing power... and that's assuming | they were content to only stay in power one term. | coltsfan wrote: | that's exactly the point. it's almost a game for rich | people to pump up their legacies or because they're just | bored. you want them gone. When they are gone, there will | be plenty of people left that choose never to buy another | stock again for the rest of their lives. No law, just a | personal code. Because the influence and power obviously | last after you leave office. Monks and samurai can exist. | Then so can a congressional Bushido. You just have to | stop voting for people who think about their stocks all | day while sitting at meetings. | xienze wrote: | > Why is it so much to ask that a Senator or especially | Representative serving in the most powerful legislative | body in the world just take a cash position for 2-6 | years? | | I agree in principle, but a lot of these people literally | serve until they drop dead, which is a different problem | with congress. Might be a bit much to tell someone not to | invest for 40+ years. | cpwright wrote: | That is bad policy. There is a segment of middle/upper | class Americans who own stock; anyone with a retirement | plan that funds it. Forcing middle/upper class | legislatures into a cash position instead of stocks would | make them less, not more connected to similarly placed | people. If they can't own stock does that mean they'll | just instead invest in real estate which can be even more | conflicted? | | Of course, if they held widely diversified Index funds | there would be fewer conflicts - but not zero as | evidenced by legislators trading around COVID briefings. | toss1 wrote: | Or perhaps better yet, simply make all trades public in | real-time. | | Trades could be scrutinized for insider trading by both the | SEC and independent traders/firms, just as there are | independent services scrutinizing the crypto blockchains. | | Insider trading could then even plausibly be legalized by | eliminating the advantage of insider trading (it'd have to | be based on a lot of study of the data). If we (or other | funds) can setup triggers to act on the trades of insiders | as soon as they hit the wire, the market will move against | them, and we can also share arguably the same advantage by | doing so. | pessimizer wrote: | https://en.wikipedia.org/wiki/STOCK_Act#Amendment | | When the public was angry, Congress passed the STOCK act. | After the news cycle was over, they repealed disclosure | unanimously. | djrogers wrote: | Disclosure still applies for Congress (and POTUS/VP), it | was repealed for 28k other gov't employees. | | Also, it's mandated 45 days after trades - not in advance | as many here are calling for. | pessimizer wrote: | Not being specific enough made my comment misleading. | | "The amendment also eliminated the requirement for the | creation of searchable, sortable database of information | in reports, and the requirement that reports be done in | electronic format, rather than on paper." | somethoughts wrote: | Yes - in addition - just have documentation sites like | unusual whales which track the trades, holdings and profits | of politicians - create infographics prior to every | election and distribute them to existing voter | information/polling prediction sites like real clear | politics. | | Politicians already long on certain stocks can also profit | from legislation that they are passing. Being privy to | insider info which leads to continuing to stay long a stock | is an advantage that wouldn't be detected by just sharing | recent trades. | | In addition to trying to eradicate insider trading - just | shedding light on existing holdings by US office holders | will have a huge cleansing effect that will go a long way | to showing potential biases/conflicts of interest. | mikepurvis wrote: | I would love to believe that would make a difference, but | in a hyperpartisan world where many vote based on a | handful of ideological allegiances, how many would | seriously be moved to change sides over something as | small as a little corruption? Or is this something that | would be more at the primary level, where it really is | more about personality and personal qualities than party? | | In any case, the Trump movement's whole response to this | kind of thing was a combination of denial and "lol | everyone does it", and it seems like that was enough for | many in that camp. | somethoughts wrote: | Or is this something that would be more at the primary | level, where it really is more about personality and | personal qualities than party? | | >> For sure there are many factors that influence | someone's vote. I think you're right - its more likely to | cause leadership rotation within the parties where the | rest of the factors are more similar (i.e. stance on gun | rights, etc.). The challenge today is that incumbent | politicians within their own party tend to have great | name recognition among voters - but are more likely to be | in the pockets of corporations. This would enable | challengers within the party to potentially have an issue | they can highlight. | | "lol everyone does it" | | >> And perhaps articles prove in a data science-y way | that perhaps this is true - many politicians are doing | it. | rocqua wrote: | There are still voters on the fence / differences in | voter turn-out that mean politicians worry about scandal. | The main effect is that these politicians will probably | be replaced by different ones from the same party. | Moreover, other politicians, hoping not to be replaced, | might stop doing blatant insider trading. | lend000 wrote: | Why should they be held under less scrutiny than CEO's? | They typically have to clear their stock sales with the SEC | months in advance. | cameronh90 wrote: | Also as a regular fintech worker, I have to get internal | approval from my employer for anything I do. Why can | government representatives trade willy nilly without any | oversight? | BurningFrog wrote: | If you wrote the rules for yourself, they would probably | be more lenient :) | icedchai wrote: | Do you actually "have to"? How would they know if you | don't? Basically, is it an honor system? | psychlops wrote: | 20 years ago it used to be the honor system. Now all the | records are connected, many make it a requirement of | employment to move all accounts into the firm. | dmurray wrote: | Also, it's mandated by the SEC. There are obligations on | you, your employer, and (if your broker is in the US) | your broker to ask you, and to inform each other. | | So it's kind of on the honour system - your broker | probably won't ask you for payslips proving you _don 't_ | work in the industry - but a lot of people are | incentivized not to let it happen. | FabHK wrote: | When I was in that situation, I had to disclose all | brokerage accounts to my employer, and authorise the | brokers to send copies of the account statements to the | employer's compliance department. | somethoughts wrote: | That's true too! Finance sites like Marketwatch and Yahoo | have insider transaction logs for each company when you | search their ticker symbol [1]. There should be a tab to | view "US office holder and their immediate relatives" | transaction log page as well listed for each ticker. | | [1] https://finance.yahoo.com/quote/AAPL/insider- | transactions/ | throwaway5752 wrote: | I speak for a lot of people that while I agree with you in | principle, the sudden interest in this idea in Republican | circles after the prior administration's absolute mockery of | conflict of interest and self-dealing laws seems | hypocritical. | jb775 wrote: | Can you provide any sources for your claims that prove | Trump administration personnel directly profited off any | supposed self dealings? Or are you just pulling this out of | your ass bc you are a lib? Also, who else specifically do | you "speak for"? | | This article isn't even about self-serving decisions that | may benefit politicians down the road...it's about | politicians who are actively using politician-privy inside | information for short term profit at the expense of their | constituents. But hey let's keep crying about orange man | bad! | Swenrekcah wrote: | The "orange man" was bad. | | This is getting tired. If you are interested in his | cronies' self dealings just look it up. They did all of | these things and more but also did them more explicitly. | Which is a bit more honest in a way I guess? | | But the worst part about 2017-2020 was the way he cozied | up to enemies of democracy, undermined democracy himself | and made a point of sowing and igniting division. | | Back to the article, this behaviour is despicable and | should be punished for everyone, D or R. | jb775 wrote: | > just look it up. They did all of these things and more | | Can you provide a single example with a source that | proves this? And please provide an example of how he | "undermined democracy". Sounds like you watch a lot of | CNN. | | I agree it should be punished equally not depending on D | or R. | Swenrekcah wrote: | Sure, here's one for the former (link below) and for the | second you might remember the refusal to accept the | election results and months of egging his supporters on, | culminating in an attack on the US Capitol and the deaths | of 4 or more people. | | https://www.nytimes.com/interactive/2020/10/10/us/trump- | prop... | munk-a wrote: | Laws need to come into force sometime - and as long as | we're not going to get a ping-pong law that's repealed as | soon as republicans get into power then I don't mind it | happening while democrats hold the torch. I am well aware | of the hypocrisy some folks show on this topic but, | honestly, it's a good law no matter who is in power and if | we're just trying to be petty we won't get anything done. | [deleted] | Avalaxy wrote: | Would it really help? You can't restrict their complete | social circles as well. All it takes is 1 willing friend who | will happily accept your stock tips ahead of large | announcements and who's willing to give you a share of the | profits in return. | alkonaut wrote: | That's true for all insider trading yet we at least attempt | to limit that. | Taylor_OD wrote: | If you took away the politicians way of getting rich then | what motivation would people have to be politicians? /s | unethical_ban wrote: | I'm thinking of running for city council because I actually | give a shit about civil service, the importance of good | government, and I think I'm a better option than some of | the absolute nutcases even running for _mayor_ in my city. | | Some people actually care. | BurningFrog wrote: | Power! | | I don't like this corruption, but there are many worse | things our rulers could do. | yumraj wrote: | I'm curious if any of this falls under the definition of | _insider trading_. It should, but I think it doesn 't and which | is why SEC doesn't get involved in these. | | Does anyone know? | teh_infallible wrote: | The SEC has long been selective about which rules they | enforce and when. | freeone3000 wrote: | For a long time, Congress had an exemption to insider | trading. They no longer do, but, insider trading still | requires material non-public information about the company in | question -- and Congressional acts are the most public thing | possible. Betting that a company's stock will go up (or down) | and then making it happen after you make the bet isn't | insider trading, it's activist investing, and is totally | legal. | powersnail wrote: | But if they bet first, wouldn't that makes them unfit for | making decisions on where the contract should go? Shouldn't | the government official be excused from this decision | making process if they have a personal interest in one of | the candidate? | YinglingLight wrote: | >Congressional acts are the most public thing possible | | Not when said action occurs a week before the Congressional | act is announced. Is this HN thread flooded with bots or | something? Have never seen this level of sympathy for | politicians. | sneak wrote: | What they said was objectively true, regardless of your | opinions for or against the situation. | devmor wrote: | No, it was not true. It was predicated on the falsehood | that congressional acts are announced as they are | decided. | LanceH wrote: | The current count for who has pledged to vote for what is | highly relevant and _private_ information. | skohan wrote: | Maybe it's legal, but it should absolutely not be. There's | too much risk that a legislator's personal interest will | run counter to the interests of the public, and the system | should have safeguards against this. | blunte wrote: | Unfortunately that risk is very much in play even without | stock trading. Politicians often appear to be working | purely to stay in office and gain whatever side benefits | they can along the way, and to establish a very lucrative | lobby landing after they leave office. | | It is all practically very corrupt, viewed from most | angles. The few well-meaning politicians either don't get | elected or don't stay in office, because it costs too | much to get there and stay there (funding); so to get | there and stay there, you have to play the game. And | playing the game means ensuring your wealthy donors get | what they want from you in terms of legislation. | skohan wrote: | Yeah that's all fine, but you can still work to outlaw | the most blatant conflicts of interest. Government isn't | perfect anywhere, but for instance in northern europe | they're doing at least a tiny bit better on that front. | jb775 wrote: | I'm pretty sure they can't be charged with insider trading | for some loophole reason. It's 100% insider trading though. | US politicians and their families shouldn't be allowed to | buy/sell any stocks as a condition of public office. And they | shouldn't be able to accept revolving door money after | leaving office as well. | jwilber wrote: | Casually making millions, almost certainly illegally, while her | district suffers as one of the nation's most severe when it | comes to income inequality. [0] | | Every day I become more and more convinced that all politicians | are basically the same - chasing self-interests, power, and | prestige. | | [0] https://www.ppic.org/publication/income-inequality-in- | califo... | ABeeSea wrote: | California has high inequality compared to other states | because the rich people don't want to live in those other | states. It's not like people are rushing to move to | Mississippi or West Virginia. | | It's easy to have low inequality when everyone is very poor | like West Virginia. | disgrunt wrote: | Here's a recent Pelosi options trade with the Microsoft AR | contract announcement. [0] | | [0]: https://www.thestreet.com/mishtalk/economics/nancy- | pelosis-h... | SilasX wrote: | >Her husband buys deep ITM TSLA and AAPL calls that day. | | Stupid question: if you were expecting an upswing in a stock, | wouldn't you get the most returns from an out of the money | option? For a deep ITM you're paying the same as the underlying | stock plus a tiny premium -- you might as well just buy the | stock. | ABeeSea wrote: | A large swing increases the IV which increases the premium | (since the stock is now more likely to swing back down). Also | decreases the risk in case the trade moves against you. | labcomputer wrote: | Sure, but if that's your investment thesis you'll get a | better return by buying an ATM call than a (relatively | safer) deep ITM call. | SilasX wrote: | But then you'd own the option so you'd benefit from the | volatility and can quickly cash out, right? | ABeeSea wrote: | Yes, you cash out the options when the IV spikes when | swings up. | SilasX wrote: | So, back to the original question: wouldn't OTM options | make more sense in their position? | ABeeSea wrote: | If the bet is wrong, OTM options expire worthless. ITM | options give you less risk, but for a premium (you buy | fewer contracts with the same amount of money). But still | with more leverage than outright buying the stock. | | This is captured in the concept of Delta one of the | "greeks" which is a parameter in the black scholes | equation and solution that tries to measure the pricing | movement of the option relative to the price movement of | the stock. Owning stock has a delta of 1. ITM options | have a delta closer to 1 but not exactly 1, OTM options | have a delta closer to 0, but not exactly 0. ATM options | of a delta around .5. | SilasX wrote: | Fair enough, but then if you're having to hedge that much | against downside risk, it doesn't feel like insider | trading. The whole problem with insider trading is that | have special knowledge of which way it's going to go. At | the point where you're having to protect against the | possibility of being so wrong, that doesn't feel like | acting on insider knowledge, and it's more like | "interested outsider" trading. | ABeeSea wrote: | I personally don't think it was insider trading so in | that sense I completely agree with youx | onemiketwelve wrote: | An insider trade like this isn't about managing risk and | things expiring worthless, it's about maximizing expected | value while not making it too sus. | | If you bought a deep itm call, it would behave almost | exactly like owning a share. The stock goes up 5% , your | call goes up 5% + 1% let's say for the increased iv. | | If you felt like there was a 75% chance it would go up 5% | and a 25% chance it goes flat or down, then your best | expected value would be buying a otm call. The math would | look something like ev= .75 * 400% + .25 * -100% | | And even then, nobody holds an option that went the wrong | way to 0, so the -100% term would be less as well. | ABeeSea wrote: | I don't think it was an insider trade. But to use the | articles example, Microsoft is so large and diversified | that the headset contract news might not swing the stock | price. Especially if there is broader negative market | news. | onemiketwelve wrote: | It's not stupid. I'm questioning whether the original person | understands what a deep itm call means. If you knew a stocks | gonna move, you buy at the money or out of the money. Never | would you buy _deep_ in the money. Makes no sense. | mdoms wrote: | > This is fucking unreal. | | It's USA. Corruption is the norm. | tzs wrote: | I don't know about the Gottheimer example, but their Pelosi | example seems pretty far fetched. | | First of all, Congress passed a stimulus bill on Dec 21, the | day before her husband bought those calls. Any 5% gain over the | next couple of days or so is for more likely in response to | that, and in anticipation of Trump signing the bill soon, than | it due to Pelosi changing her mind about some possible future | stimulus that hasn't even started being negotiated yet. | | Second, the 5% "rally" for AAPL only lasted a week. TSLA's rise | lasted longer, but it was rising before this. The article | doesn't say anything about whether or not they actually | exercised their options to buy the stock, and then sold it to | actually profit. If they didn't, then this "rally" had no real | effect on them. | | Third, looking at other tech stocks, GOOG pretty much did | nothing around or for a while after Dec 22. AMZN fell for a day | or two, spiked up, came back to around what it was. FB was kind | of like AMZN, but the spike was smaller and the fall was | deeper. Looking beyond tech stocks, the Dow and the S&P 500 | don't show anything happening around the time. Most things | continued the trends they had been on before. | | That suggests that Pelosi's change of heart about possible | future stimulus bills didn't have much effect on most stocks. | So why did they buy AAPL and TSLA? Even if they thought there | would be an effect and wanted to exploit it, buying TSLA to do | so makes no sense. AAPL makes a little more sense, but not | much. AMZN or some other company whose products people would | actually likely spend stimulus money on would make more sense. | femiagbabiaka wrote: | Oligarchy in the U.S. is giving my mother country (Nigeria) a | run for its money. | tomcam wrote: | Don't be silly. The U.S. is infinitely more corrupt than | Nigeria. Forgive me, but there's just no comparison. | femiagbabiaka wrote: | hah! I am sympathetic -- the U.S. corruption is definitely | more impactful to the world, and on a much greater scale. | But it is also more covert and _usually_ doesn't creep into | the level of person to person bribery in everyday | interactions (IME). | akudha wrote: | Isn't Pelosi worth like 100 million or something? How much | money is enough for these people? :( | | How quickly are these trades made public? Maybe we should just | copy the congress people's trades and make some profit | ourselves :P | kennywinker wrote: | Well, according to the US supreme court, money is speech - so | more money more voice. As a concrete example, trump backed | his own campaign to the tune of ~$66mil. Without it, I'm not | sure he would have gotten as far as he did. | | (I'm not endorsing this, I'm just saying these are the rules | of the game that's been set up) | | And to answer your second question - not quick enough for the | public to act on it. | frockington1 wrote: | Clearance time varies but can take months. They've already | collected profits by the time they are disclosed | BurningFrog wrote: | Any sum is fine as long as you got it honestly. | | The problem with Pelosi and others is that the money comes | from abusing their power, and is in effect taken from other | investors. | Yoofie wrote: | The most amazing thing is that these people keep getting | re-elected. The voters are the ones allowing this to | happen. | eloff wrote: | > How much money is enough for these people? :( | | What kind of attitude is that? If you have savings, one seeks | a return on said savings by investing them. That's perfectly | normal and rational behavior at all wealth levels. | burkaman wrote: | It is not rational once you have enough money for you and | those you care about to be infinitely comfortable for the | rest of your lives. | | Say you have $100,000 in the bank, and you want to spend | $10,000. What's the best use of that money? For a normal | self-interested person, a rational use would be to invest | in whatever will give the largest return, in order to have | enough money for living expenses, retirement, children, | whatever. | | Now, say you have $100 million, and you want to spend $10 | million. What's the best use of that money? Seeking a | purely financial return is completely pointless. It will | have absolutely no impact on your life or future, or those | of the people you care about. So as a person with a normal | amount of self-interest who also cares about other things | in the world, the most rational behavior would be to donate | it to a cause you care about, or start some purposeful | organization, or anything that will have a positive impact | on something or someone you value. At this level of wealth, | just making more money has no positive impact on anybody, | even yourself. | | I guess it's possible that Pelosi is saving up in order to | start a SpaceX competitor or buy an NBA team or something | once she leaves Congress, but she's 81 so that seems | unlikely. | eloff wrote: | You seem to have a fundamental misapprehension of | capitalism. | | If you invest your capital, it's not being hoarded in a | money bank like Scrooge McDuck. It's being put to use by | the companies and institutions you invest in to provide | products and services. | | Now I'm all for donating to charity, and it's a much | better option than leaving massive wealth to your | offspring, in my opinion. | | But investing your money is totally rational at any | wealth level and it's good for society, and necessary for | capitalism to function. | solipsism wrote: | _It 's being put to use by the companies and institutions | you invest in to provide products and services._ | | Why is that better than these companies living off their | profits? You talk about it and if it's a given. It's not. | philsnow wrote: | > At this level of wealth, just making more money has no | positive impact on anybody, even yourself. | | except that having capital makes it easier to gain more | capital, so you could very well end up with more impact | by aggressively investing for a few years before | donating. | burkaman wrote: | Ok, say you invest that $10 million and a year later it's | grown to $12 million. That's a decent return, but what | was the opportunity cost of investing in Microsoft | instead of, I don't know, funding 100 people on GoFundMe | who are going to die if they can't afford surgery? The US | government uses ~$10 million as the value of a human life | when they analyze the cost/benefit of various policies. | And it's a compounding investment - a dead person | contributes nothing to society, but a living one might | contribute quite a bit. That's just one example though, | you could make an argument for any number of worthwhile | uses for that money. Even something like venture capital | or political organizing, which aren't exactly selfless | philanthropic endeavors. | | And again, I'm talking about 10% of what's in the bank. | You could donate $10 million, invest $60 million, and | still have an absurd amount left to buy a few houses or | whatever you want for yourself. All while risking | nothing, if you hold onto $10 million or so to secure | your future. | | My argument is that there's some threshold after which | you have enough money to support yourself, and to invest | to maintain your way of life, and to do something | purposeful with the rest. And I think that threshold is | below $100 million. I agree that it takes money to make | money, but as you say, after "a few years" of investing, | you do something with it. When does that happen? Do you | need to hit a billion first? | gowld wrote: | "normal and rational" is different from "ethical or moral". | | "All wealth levels" are not the same. | tastyfreeze wrote: | It is not immoral or unethical for somebody to have or | earn more money than another. All people try to increase | their wealth however they can. At lower income levels | that is very difficult but the behavior is the same. | eloff wrote: | Let me strengthen my position by adding that it is also | moral and ethical to seek a return by investing, | providing you make reasonably ethical investments. Maybe | not in the coal industry or whale meat industry - but any | number of things can be perfectly ethical and even | beneficial to society at large. | akudha wrote: | Does _reasonably ethical investments_ include using | insider knowledge? | | Which is what these politicians seem to be doing. Sure it | is not illegal, but is it ethical? | eloff wrote: | I'm not advocating for insider investing - which may well | be going on here. That's obviously not ethical. | | I made a much more general statement in my comment, which | you seemingly objected to. | pc86 wrote: | This took a left turn when someone started just | complaining that people have a lot of money. | dysrend wrote: | It fails to comply in either case. | blunte wrote: | Let me phrase the question differently: | | How much money is enough if you already have $100M and to | gain more, you have to manipulate and cheat? | | But even without changing the question, $100M invested in a | very low risk manner will generate considerable cash flow | (if you regularly take some profits). So without even | spending your "savings", you can live very comfortably. | | However, a special thing happens when you are high net | worth. You suddenly have a lot of lenders begging to loan | you money at very low interest rates. They need a place to | put money, and they know you have assets to cover any loan | they might give you. So you, the wealthy individual with | $100M in assets, CAN still go buy nice stuff even if your | cash flow from your investments isn't huge. | | Honestly, unless you just need to show people how much | money you can drop because you're so rich you don't care, | you don't actually have to spend any of your money to live | bigly. | eloff wrote: | > How much money is enough if you already have $100M and | to gain more, you have to manipulate and cheat? | | Yeah, that's not a good at any wealth level. | | > But even without changing the question, $100M invested | in a very low risk manner will generate considerable cash | flow (if you regularly take some profits) | | Sure. But individual risk appetites vary and at that | wealth level you can afford to diversify like crazy - and | should in my opinion. I'm not sure what that had to do | with anything. | pc86 wrote: | Manipulation and cheating is wrong regardless of the | amount of money. Tossing the monetary value just aims to | inflame passions and try to make an emotional appeal. | stereolambda wrote: | Please correct me, but here's a provocative hypothesis I spent | three minutes thinking through. Couldn't you say that | speculating with insider information _on public markets_ can be | a way for public officials to make a lot of money without | marrying themselves to any particular interests? In that case, | couldn 't it be potentially a mechanism we can exploit for | good? | | Disclaimer: not American, no strong opinion on these people. | jliptzin wrote: | Your hypothesis assumes that all elected officials must | engage in some form of bribery or pay for play. In an ideal | world we'd find leaders who put the interests of the country | ahead of their finances. | Tenoke wrote: | Or alternatively we can just pay them _a lot_ more since | they 'll make money anyway, disallow them from earning | money in other ways and at least have their profits have no | additional negative effects. | | Not that I expect people would be comfortable paying | politicians more (see how many complain about e.g. CEO pay) | so I guess we are stuck with incentives for corruption | instead. | kennywinker wrote: | I don't think we need to PAY them more to eliminate | corruption - I think we need to change how campaigns are | financed. Needing to raise millions every few years to | keep your job makes you beholding to whoever has the | money | jlarocco wrote: | I guess I don't see where the "good" is there? | | Being a representative isn't supposed to be a "get rich | quick" scheme. They already make a lot of money and IMO if | they're going to invest in stocks they should play by the | same rules as everybody else. | | Edit: On second thought, considering how much they can | influence stock prices, maybe they should have _stricter_ | insider information regulations. It 's a huge conflict of | interest. | tshaddox wrote: | Sure, speculating on insider information on public markets is | a great way for anyone to make a lot of money. It's also | highly illegal, although there does seem to be some fairly | prominent views that allowing insider trading would actually | help get relevant information priced into the public markets. | | But even if you're one of those proponents of insider | trading, surely this is clearly different and worse than | that, because prominent politicians surely have some power to | _influence_ winners and losers. | stereolambda wrote: | Well, the laws around insider trading and similar practices | changed throughout history. Many things used to be | considered okay, look up Joseph P. Kennedy's biography for | example. | | You are right that if the officials actually cared about | companies, it would not make sense. I was thinking more | like hedge fund-like cold speculation. As people guessed | correctly, the point is to make the job very appealing but | with little ties to powerful interests. Of course is not a | serious scheme, but I'm amused by the concept I guess. | sorbits wrote: | Personally I think that the conflict of interest posed by | stock holding lawmakers is bigger than the advantages they | gain from trading on information that only they are privy to. | | For example will a lawmaker holding a large portion of their | wealth in Apple shares want to introduce legislation that | forces Apple to allow alternative app stores (costing Apple | the 15%-30% cut of all the app store sales)? | adolph wrote: | In most situations this is called insider trading and is | considered unfair in public markets since the trades of | insiders may be concealed, like through a family member. | | Within an organization making a decision that advantages | oneself is unethical since the purpose of the most | organizations is not to fulfill the personal interests of its | employees. | | It would make some sense to convert all property holdings of | a government employee to financial instruments related to the | health of the government such as treasury notes. That way | their personal interests are at least aligned with those of | the government. To the degree that the instruments measure | aspects of the government that are not totally aligned with | the governed is a problem however. | frankfrankfrank wrote: | Re. the Gottheimer trading; if one is to believe the reports of | his net worth based on public records [1][2], he supposedly | almost tripled his wealth in just one year. That seems quite | unusual. | | The fact that he appears to trade mostly $MSFT while also being | a former MSFT Executive and seems to be extremely accurate in | his options trading of that $MSFT, only really adds to the | extreme suspiciousness. | | Is there no entity that even just tries to keep tabs on or | possibly investigates these people, let alone charge them with | crimes where appropriate? It seems that where there is smoke | ... and fire ... there may actually be fire. | | [1] https://www.nj.com/politics/2019/07/the-richest-new- | jersey-m... | | [2] https://finance.yahoo.com/news/richest-member-congress- | state... | pvarangot wrote: | 3x or 5x of your wealth if you correctly time a global crisis | is not unheard of. Even in boring stuff like real state. With | options and tech it probably happened last year to a | substantial amount of people. | kelnos wrote: | The SEC should be investigating things like this, and do | actually bring a lot of enforcement action against various | companies and individuals, but I suspect it might be a | career-limiting move to target a politician for all but the | most gross of abuses. | adamrezich wrote: | > Is there no entity that even just tries to keep tabs on or | possibly investigates these people, let alone charge them | with crimes where appropriate? | | well there's this thing called the IRS that seems to spend | most of their time auditing random citizens when the numbers | they submit on their tax forms doesn't match the numbers the | IRS already calculated on their side. maybe we could | streamline that absolutely ridiculous process & their efforts | could be used elsewhere | pc86 wrote: | This argument comes up a lot and it's an astounding | oversimplification and gross misunderstanding of how taxes | work in the US. The IRS does not know how much you owe | until you file. They may have a rough approximation, but | they absolutely don't know anything close enough to be able | to bill you. | pbreit wrote: | There is zero reason for congresspersons to trade options or | really even any individual stocks. The optics are horrific. | api wrote: | The fact that high-ranking politicians and bureaucrats can | trade stocks at all is criminal. The moral hazard is | unbelievable. | skohan wrote: | Yes it's the definition of conflict of interest. It's insane | that this is allowed | sneak wrote: | I think it's working as intended and that it's insane that | people are surprised it's set up this way. | | The state and large corporate interests in the USA are very | tightly integrated and have been for at least an entire | generation. | skohan wrote: | But this is so cynical. Not to be naive, but if we can't | at least start from the framework that the government | should serve primarily the interests of the people and be | outraged when it doesn't, then the American project is | pretty much over | sneak wrote: | I'm not sure that has ever been true, or ever been the | goal. | | The American government does serve the interests of the | American people: the American people who own the bulk of | the land and the largest companies. | | George Washington was the largest landowner in the | colonies when the revolution started. | hpkuarg wrote: | But Washington also shocked the ruling elites of the | world by stepping down when he did. Clearly, he was cut | of a different cloth than other largest landowners in | their respective countries. | kelnos wrote: | Right, and in the very beginning, only some single-digit | percent of the people living in the US were eligible to | vote. Women, slaves, non-landowners, etc. did not have | the right to vote. | | The idea that the US was originally founded "by the | people, for the people" is not at all what happened. I | guess we could say that the government they created was | progressive for its time, at least. | jcranmer wrote: | > Right, and in the very beginning, only some single- | digit percent of the people living in the US were | eligible to vote. Women, slaves, non-landowners, etc. did | not have the right to vote. | | Slaves would not have been a large proportion of the | country as a whole--about 20% at their height. While the | early US did require landownership for adult free males | to vote, the US also had unusually high landownership | rates. It's estimated that ~60% of free adult males had | the right to vote (contemporary Britain had about 15-20% | of free adult males having that same rate). So ultimately | you end up with about 25% of the current franchise rate, | or somewhere in the mid-high teens after taking into | account the existence of children who still cannot vote. | formercoder wrote: | When in the private sector those of us that even get a whiff | of MNPI are told we can't trade individual names at all. | nuisance-bear wrote: | If you work in private equity, it's the worst. Your company | isn't actively trading stock, but you still get banned from | options, shorts, and need pre-clearance for every single | trade. So you end up long SPY... even if you derive | independent utility from actively managing your portfolio. | | The law doesn't require this of course, but basically all | money managers get their insider trading compliance program | from the same 3 outside law firms. | [deleted] | ABeeSea wrote: | > Pelosi in Dec 22 was against more stimulus. | | This is not true. It's very odd to see the kind of right-wing | conspiracies based on outright fabrications spread on HN as | literal truths. Here is an article from December 22 were Pelosi | is calling for more stimulus: | | www.cnbc.com/amp/2020/12/22/trump-calls-covid-relief-bill- | unsuitable-and-demands-congress-add-higher-stimulus- | payments.html | | Here is her direct tweet dated 12/22: | | https://mobile.twitter.com/SpeakerPelosi/status/134155753573... | ? | | Edit: There are outright lies in the source article. Sad day | for HN that the lies are getting so much traction and fact | checking with 1st hand sources is getting downvoted. | itsoktocry wrote: | > _It's very odd to see the kind of right-wing conspiracies_ | | It's even more odd to see the, "if you disagree you're alt- | right/ a Nazi" mentality on HN. | | Why does a member of congress need to day-trade stocks, let | alone leveraged derivatives? It's absurd. | Goronmon wrote: | _It 's even more odd to see the, "if you disagree you're | alt-right/ a Nazi" mentality on HN._ | | You believing that "right-wing conspiracies" automatically | means ties to "alt-right/Nazis", I think this says more | about your personal biases than the person you are | responding to. | devmunchies wrote: | > right-wing conspiracies based on outright fabrications | | maybe on that one point, but the fact the democrats trade way | more on the markets is not a conspiracy _theory_ , it's an | outright conspiracy. | | why are you defending these people? because they're democrats | on paper? | allturtles wrote: | I believe GP is defending facts against malicious lies. | That seems always a good thing, regardless of whom the lies | are directed towards. | ABeeSea wrote: | Yes, exactly. This is the kind of obviously disprovable | lie that I though wouldn't fly on HN. | seriousquestion wrote: | People are confused about this because Pelosi rejected the | stimulus in October, prior to the election. She didn't accept | until December, post election. | | Some democrats were urging her to accept it in October: | https://twitter.com/AndrewYang/status/1315078896853843970 | ABeeSea wrote: | That's not what the business insider linked in the tweet | says. It says she described the White House plan as | "insufficient" meaning there wasn't enough stimulus in it. | How can criticizing a bill for not having enough stimulus | mean you are against stimulus? | | The House had passed the HEROES act for additional stimulus | in May 2020. The Republican senate refused to even put it | up for a vote. She was always for passing of the HEROES act | even during this October - December period. She was always | pro stimulus. | jfk13 wrote: | > the HEROES act | | Does anyone else cringe at this American obsession with | naming acts of congress so as to create "inspirational" | acronyms? | sneeze-slayer wrote: | Yeah, I think it's really weird. Maybe a way to help give | the bills "spin" and gain support. Honestly, though, I | think there are bigger things to worry about. | ianthiel wrote: | Why is this being downvoted? These are references to primary | sources that directly contradict facts presented. | bombastry wrote: | I also thought this was odd. This site alleges malfeasance | based purely on analysis of data but then alludes to a | person's thoughts on specific dates without citation. | | I also found this article on 2020/12/21 where Pelosi says she | wanted more stimulus, but the $600 checks were | significant.[1] So it seems all the more unlikely that she | said she was against further stimulus at any point on the | 22nd. | | [1] https://news.yahoo.com/nancy-pelosi-wanted- | more-600-22542493... | gexla wrote: | Pelosi is a master politician and the pandemic has been a fast | moving situation. I could see Pelosi being against the stimulus | and then fast switching based on changing currents in the minds | of voters. | itsoktocry wrote: | Great. Why does she have to buy shares in companies that | align with her "switching"? | kgog wrote: | Unsurprisingly, vast majority of $ traded in Energy and | Industrials is by GOP, and in tech is by Dems. | | Then there's this: | | > Meanwhile, Republican Congressman Mark Green, alone, accounts | for 99% of the stock purchases in oil and gas companies like USA | Compression and Energy Transfer. | | Look this guy up [1]: | | > Green rejects the scientific consensus that human activity | plays a key role in climate change. | | [1] https://en.wikipedia.org/wiki/Mark_E._Green#Climate_change | finexplained wrote: | Members of congress should only be allowed to invest in SPY/VOO, | VTI, and a few other broad ETFs, long only, no options. | prussian wrote: | Honestly, this should be held for any positions where insider | information is clearly a conflict. Maybe not in specific | instruments, but investments should be made through a third- | party money manager. | throwawayboise wrote: | My thought was that they (and immediate family) would have to | put their assets into a blind trust could be disolved upon | their leaving office. They should have no ability to make | personal investment decisions while they are in a position of | such influence and insider knowledge. | throwastrike wrote: | Exactly. If you work for a bank, you can't buy certain stocks. | Some firms will limit you to ETFs and indices. Why can't we | apply simple private sector rules? Politicians, both republican | and democrats, are crooks. I don't think you can contest that | outside perhaps a handful of public servants. | beervirus wrote: | That would be a good start. But it's still problematic for them | to sell positions like that on non-public information like news | of a new pandemic. | finexplained wrote: | I agree, it's a start. But importantly it (attempts to) align | their interests with the broader US economy. Also it still | allows them to invest for their personal futures, which I | believe is a right. | ralusek wrote: | Hasn't the last year very clearly demonstrated that the ability | to lower interest rates and print money has had _far_ more of | an impact on the market than anything else? Stocks are | practically moving up and down in unison, the market is almost | entirely macroeconomics driven when 40% of all USD was created | in the last 12 months. | | If they can invest in total market indices while having the | ability to control the money supply, even if they can just go | long, it doesn't matter. | rsync wrote: | "... long only ..." | | Can we please stop perpetuating the myth that short selling, or | holding short positions, is some kind of exotic or shady or | villainous activity ? | | It's not. Short selling, and the holding of short positions, is | value neutral and is part of a healthy properly functioning | marketplace. | | I don't know what politicians should or should not be doing but | a long vs. short distinction is silly. | finexplained wrote: | My apologies, it wasn't my intent to imply that myth. I | actually completely agree with your position on short | selling. At the time of writing it just seemed a bit weird to | me, and possibly an incorrect alignment of interests, for a | US politician to take a short position in SPY... | rsync wrote: | OK, actually that's interesting - if they are restricted to | SPY (for instance) then it would, indeed, be a bad look if | they went short ... | BrianOnHN wrote: | Sounds like overreaching blanket regulation. | | What if we just regulated the 0.01% who's wealth is such that | it makes the top elected officials in our country have a | seemingly insignificant compensation. | elliekelly wrote: | This is more or less what everyone in the registered investment | adviser & mutual fund world must do. There's quite a lot of | compliance software to facilitate approval and checks before | and after a transaction is effected in a personal account and | the personal transaction history is compared, broadly, with | market performance and internal fund transactions periodically | to check for overlapping trades (+/- a week) in the same | direction. | slaymaker1907 wrote: | I had to follow these ridiculous rules despite the fact that | I never actually had access to PII and was working as | programmer at Goldman Sachs (in PWM, no robo trading or | anything). These rules seem to be in place mostly for | (relatively) poor people. | de6u99er wrote: | What about their friends and families? | finexplained wrote: | In the financial industry we have restrictions not only on | our own trading accounts, but on any account that we might | have reasonable influence over. In my particular case, this | means both my brokerage accounts and any of those belonging | to a spouse. This is a requirement by our compliance | departments to follow SEC regulations regarding insider | trading. I don't see why similar rules would not be applied | in this setting. | de6u99er wrote: | Sure, but ultimately it's only a crime if they get caught. | And even then it seems to me that they can get away with it | too easily. | | How about electing honest people, instead of constantly | voting for the establishement (w. a few exceptions). | finexplained wrote: | I'm obviously for electing honest people. | | It's probably (I don't work at the SEC) true that it's | still difficult to catch all perpetrators. The SEC has | limited resources and they probably have a way of | prioritizing cases that they think have sufficient | evidence. No system is perfect, but from my perspective | the SEC is a respected organization whose authority is | treated seriously. I have frequently been told that I | will face serious jail time if I engage in insider | trading and am later caught. | mLuby wrote: | (If you know a way to reliably detect "honest" people, | it'll make you enough money to stop caring about all this | and probably win you a Nobel peace prize too.) | | How to detect these crimes? By doing what the article | describes: analyze the public officials' public | disclosures and performance to see if "House members are | outperforming market averages" or "house members followed | trends far earlier" than the rest of the market. I would | extend this analysis to family and known associates as | well; if the politician's neighbor starts making really | smart trades around the time the politician entered | office, that's worth investigating. | | I wonder about allowing any constituent to bring a suit | against their politician if they believe they can prove | insider trading. Judge/grand jury still has to rule | (publicly!) that it's case-worthy _before_ bothering the | politician. If the politician loses the case, they 're | removed from office, must cover all legal fees, and must | give the ill-gotten gains to the constituent who brought | the suit as a bounty. If the suit fails, that suing | constituent has to cover the legal fees. | | We could also require (and might already for all I know) | a written justification at time of each trade, which TV | suggests is a thing hedge funds have to do, but that's | basically just a fixed transaction cost since anyone with | money could hire an "analyst" to write something | plausible. | | Another comment suggested that officials should have to | announce trades in advance, though that might have the | effect of banning trades altogether. | | Fundamentally, I want my elected officials focused 100% | on doing their job, not trying to get rich in their spare | time. So barring them from all trading while in office | would be fine by me. | steveBK123 wrote: | Of course if you actually work in financial services industry, | your personal trading is extremely restricted. This is regardless | of being in no position to see positions/flow/etc that would give | you any insider edge. | | The industry generally sees it as easier to show compliance by | having locked down personal trading by employees. | | Usually this takes the form of - ETFs only, pre-clearance | required, 30 day holding periods, limited to using only a list of | 5 approved brokers.. and sometimes all of the above. | | The restrictions apply not just to spouses but to anyone in | household, and you have to attest you are reporting any holdings | of say.. your parents, if you still live at home. | | So the mother of a live-at-home college grad tech support analyst | who plugs in phones at a bank has more trading restrictions than | senior politicians :-) | Havoc wrote: | > and sometimes all of the above. | | And you need to grant them access to the broker data feed and | no derivatives. | | It's in part why I'm suddenly into crypto. | steveBK123 wrote: | lot of them banning crypto or requiring disclosure as well | paulpauper wrote: | this is the guy who spams literally all of chamath's tweets and | everyone else in involved with finance and investing | asdev wrote: | This can be solved by having trading of securities on an open | blockchain. Have insiders/government officials sign time locked | transactions ahead of time for the entire world to see. | Zelphyr wrote: | Until we all start holding these people more accountable, and | better educating ourselves on the issues, nothing is going to | change and they know it. | | Here is, in particular, what they know: We as a whole despise | Congress but somehow manage to convince ourselves that, "My | representative is the only one who is honest!" so we re-elect | them over and over again. | | Here is another thing they know: the number of people I know | personally who bitch and complain about issues based purely on | headlines they've read or heard (note, it's ONLY the headlines. | they can't be bothered to actually read the article) is, for me, | astounding. In other words; the people don't want to do the work | of really educating themselves and the politicians take advantage | of that. | | Let me say it again. Until we educate ourselves and demand that | the people we elect be more accountable to us, the people, then | they will. not. change. | vmception wrote: | I don't have a problem with this. | | Did this really harm your confidence in the markets, or did it | only harm your confidence in politicians who have been doing this | for hundreds of years whether there was mandatory disclosure or | not? | | Insider trading regulations are based around people feeling | willing to use the capital markets at all. People use the US | capital markets, so expanding that regulation is not necessary. | | For the latter observation, I would like there to be quicker | reporting so that we can trade alongside it. | bluecalm wrote: | One thing that comes to mind is that maybe stock market is to | nervous reacting to news. Microsoft isn't worth suddenly 5% more | or less depending what some politician says on a given day. | | I mean insider trading should be illegal especially for real | insiders. That I am not arguing. The market just seems to easy | too spook and not that efficient to me. | hastes wrote: | Pelosi makes millions during the 'deadliest pandemic in history' | and no one turns an eye. Problem is this will fade away like | every single other important topic of these ruling elites, who | don't give a single f*k about you or me or any social issues. | | They are plainly there to shove through their friends interests, | profit off of insider information, and get out without going to | jail. Every single one of them. | ffff0ffffff wrote: | Pelosi is a FUCKING CUNT! FUCK THAT BITCH! ___________________________________________________________________ (page generated 2021-04-15 23:00 UTC)