Unusual Stock Trading by Whales in US Congress(unusualwhales.com)
unusualwhales.com
Unusual Stock Trading by Whales in US Congress
https://unusualwhales.com/i_am_the_senate
492 comments
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?
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:
- <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?
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
- <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?
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...
https://towardsdatascience.com/how-to-extract-tables-from-pd...
> 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.
https://unusualwhales.com/i_am_the_senate/data
Looks like the report gets filed shortly after the trade.
Real time? No. The legislators have to report their trades a couple months after they make them, IIRC.
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
[0]: https://unusualwhales.com/i_am_the_senate/data
That's unfortunate; If was real time a copycat investment strategy would work, right?
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.
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.
IIRC, the same law that requires them to report their trades makes it illegal to use that data to profit.
There is no way it would be illegal to trade based on their disclosures
If I had to guess I'd say they're probably using EDGAR - https://www.sec.gov/edgar
Take a trip to 1995 and check out what we use in Canada: SEDAR:
https://www.sedar.com/
https://www.sedar.com/
It talks about that pretty high up on the site that is linked. Just go read it.
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
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
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]
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?
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?
Constitutional amendment?
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...
> 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...
The state national convention route is the most likely route to work if you really want to reign in Congress.
[deleted]
Participants in a constitutional convention?
How about initiative and referendum in the 26 states that have such processes and agitating for such processes in the states that don't.
That's a very blunt instrument and difficult to get the wording correct.
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.
"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.
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.
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.
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.
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.
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.
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.
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.)
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.
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.
Further - it will not be reduced to zero. The goal is to move towards zero.
Or get a handle on the wealth inequality that makes the way we compensate our top elected officials seemingly insignificant.
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.
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.
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.
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.
> 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)
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)
https://www.politico.com/news/2020/12/18/elizabeth-warren-st...
https://www.warren.senate.gov/imo/media/doc/Anti-Corruption%...
https://www.warren.senate.gov/imo/media/doc/Anti-Corruption%...
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.
Note that the house majority leader is also one of the biggest winner of these rules not existing.
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.
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.
Is this not already illegal? https://en.wikipedia.org/wiki/STOCK_Act
> 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.
Is it worthwhile to call it illegal when it's not enforced?
If this starts making a stink, they're going to create the ability to not report your stock purchases.
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.
It got too easy to see who’s flying their private jets and where.
Meanwhile if you travel by car, get bent.
I think opposite is more likely. After the GameStop fiasco there is a push for more transparency, not less.
> 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.
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.
"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).
Welcome to the system. This is pervasive in many other aspects as well (court, police, DA, etc).
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.
Maybe an executive order could also prohibit this? I'm not sure.
"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.
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.
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.
Liquid democracy is something that can be built from the ground up, and has the potential to deprecate our modern system.
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?
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)
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)
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.
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.
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.
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.
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.
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.
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.
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.
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.
The number I saw was $300k. But either way, I don't think that's true. Countries with endemic corruption tend to underpay people. E.g., countries where you have to bribe cops and bureaucrats are ones where those people have a hard time making a living on their normal salary.
Some people, of course, are infinitely greedy. But most people aren't. E.g., most developers I know aren't maximizing their income fully, and they definitely aren't criming to make even more money.
Some people, of course, are infinitely greedy. But most people aren't. E.g., most developers I know aren't maximizing their income fully, and they definitely aren't criming to make even more money.
I don't think increasing the pay of lawmakers from 175k to 300k would decrease the corrupting influence of money.
Good thing that's not the only part to what we're discussing then.
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.
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.
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.
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.
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.
Make that a "top 5% salary" from the pool of Fortune 500 CEOs, and it might do the job.
you sure you meant top 5%? US congress is already easily in the top 5% of salaries
Love it, that’s the other side of the coin I like
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.
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.
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.
No system can prevent humans from exercising their basic instincts, emotions, urges, needs, and wants.
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.
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.
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.
Maybe it helped for a while?
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.
> 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.
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.
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.
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.
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.
> 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.
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.
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...
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...
AOC has been silent on Democrats doing similar, which make it seem like she doesn't really care.
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.
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.
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.
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.
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.
>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. ;)
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. ;)
Can you dig up that study please?
> 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.
We should expect elected officials to have both. It's not like it's impossible.
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!
> It's easy to be a thorough cynic in the modern world...
Thanks to politicians it's never been easier!
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.
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.
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.
It's impossible.
Who watches the watchmen?
And Democratic party believes that bigger gov't is the solution to many of our problems.
Who watches the watchmen?
And Democratic party believes that bigger gov't is the solution to many of our problems.
If it's impossible to have an effect, then every government would be equally bad at this. But that's not the case.
Show me a country with little government that is successful.
Comparatively speaking, most Western countries.
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.
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.
Could you at least pick one so we can talk specifics?
No, because you already have made up your mind that big government is good and will associate any market friendly economy with big government automatically in your head instead of looking at it on a global/historical scale. So there's no real reason to waste my time.
You make broad pronouncements and avoid talking about specifics because your argument is incorrect and indefensible. You say a statement is true of most western countries but can't name one in which you would be willing to dig deeper. You use glib pronouncements to hide the fact that your words lack substance. It's not your time that is being wasted.
This is a joke right? Based on what measurement do most Western countries have little government?
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.
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.
"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".
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".
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
https://ballotpedia.org/Initiative_and_referendum
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.
To start with, there needs to be lots of advocacy for insider trading investigations
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.
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.
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
Use the 4 boxes of Liberty
https://en.wikipedia.org/wiki/Four_boxes_of_liberty
https://en.wikipedia.org/wiki/Four_boxes_of_liberty
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.
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.
AOC won’t be immune to the same pressure that eventually corrupts longtime politicians. She’s just barely begun her second term. I’m certain she’s already begun to make perfectly legal deals and investments that are going to look shady to average people.
Also, one person’s “shouting nutjob with barely a highschool degree” is someone else’s “passionate populist who represents the common people.”
Also, one person’s “shouting nutjob with barely a highschool degree” is someone else’s “passionate populist who represents the common people.”
Nice false equivalency!
But you're right: flat earth society is real, so I guess they could elect a nutjob.
After 4 years of Trump, your "both sides are the same" bullshit is DOA.
But you're right: flat earth society is real, so I guess they could elect a nutjob.
After 4 years of Trump, your "both sides are the same" bullshit is DOA.
You’ve missed my point. Politics is a team sport and optics depend on your worldview and biases. “One mans X is another man’s Y” is me pointing this out.
But also, please refrain from calling other commenters’ thoughts “your bullshit” because that’s not nice or productive discourse.
But also, please refrain from calling other commenters’ thoughts “your bullshit” because that’s not nice or productive discourse.
> half of the US is below average intelligence
That is what average means.
(Looks like we two are keeping it balanced!)
That is what average means.
(Looks like we two are keeping it balanced!)
/woosh/
> > half of the US is below average intelligence
> That is what average means.
That is what median means.
> That is what average means.
That is what median means.
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.
The same goes for Republican representatives in highly red states.
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.
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.
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.
Someone should turn it into comedy, make a parody of it.
> 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.
> 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.
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.
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.
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.
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?
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?
Are you advocating that if a relative of mine runs for office and is elected (whether I supported their candidacy or not), I should be prohibited from owning stock?
It could work the other way around, ie if your close relations have stock that may affect your governing decisions and they refuse to commit to re-investing more generally in the event of your election, then you are prohibited from running for office.
Obviously there would be complications, but are you advocating society shouldn't strive to clearly separate governance of the public from private, conflicting pecuniary interests? I can't tell if you're dismissing the problem or saying there's a better solution ...
Obviously there would be complications, but are you advocating society shouldn't strive to clearly separate governance of the public from private, conflicting pecuniary interests? I can't tell if you're dismissing the problem or saying there's a better solution ...
I'm mostly thinking of spouses, parents and children, and I think that a blind trust should probably suffice (you could own stock, just not have direct control over it).
The rule sounds fair for direct family members (wife, husband, children under 18, etc.).
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.
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.
I agree. Their wealth should be in a blind trust (unless they run the company or farm or whatever).
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.
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.
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.
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.
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.
> 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.
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.
I submit that this would kind of help stop the "sit in the same position until death" problem.
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.
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.
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.
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.
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 café, 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.
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.
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.
That more analogous to the politician trading. They do have inside information, but it's not from inside the company they're trading.
No, because that would be considered "stealing" from Microsoft. (I think it's a stupid way to define it.)
Thanks! I actually appreciate the nuanced correction. I used insider trading as the term not specifically because the information was non-public but that it feels like they have inside knowledge since they are able to directly affect the markets. Maybe there is a better term for this? I don't think this still falls under what you said.
Market manipulation?
Again, they are serving in the most powerful legislative body on earth. Putting retirement savings on hold is an extraordinarily small request given the amount of power that even the lowest-ranking Senator yields.
Too harsh. A blind trust would be quite enough.
There is always a way to circumvent security systems.
The only practical solution is having less centralisation of power, so no-one can easily manipulate the market.
It's not just Nancy Pelosi, most people in her position would do that. The position of power corrupts people.
The only practical solution is having less centralisation of power, so no-one can easily manipulate the market.
It's not just Nancy Pelosi, most people in her position would do that. The position of power corrupts people.
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.
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.
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.
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.
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.
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.
>> 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.
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.
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?
If you wrote the rules for yourself, they would probably be more lenient :)
Do you actually "have to"? How would they know if you don't? Basically, is it an honor system?
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.
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.
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.
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.
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/
[1] https://finance.yahoo.com/quote/AAPL/insider-transactions/
If I was a foreign government, I would just monitor these announcements and impoverish the US politicians.
If I was a foreign government, I would want to enrich US politicians, so they became favorable to my causes.
Good. That will discourage them from manipulating the market.
No need for foreign government -- the whole world can do it.
No need for foreign government -- the whole world can do it.
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.
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.
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.
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.
Their children or other family would do the deals.
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.
When the public was angry, Congress passed the STOCK act. After the news cycle was over, they repealed disclosure unanimously.
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.
Also, it's mandated 45 days after trades - not in advance as many here are calling for.
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."
"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."
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.
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.
Isn't this already an illegal conflict of interest?
Are federal representatives immune?
Are federal representatives immune?
Congress excluded itself from insider-trading laws. Convenient, eh?
Can anyone cite a source for this? I don't doubt the legitimacy, but would like to know more about it.
It doesn't seem to be true any longer with the STOCK act.
https://en.wikipedia.org/wiki/STOCK_Act
https://en.wikipedia.org/wiki/STOCK_Act
It was repealed silently and unimanously in 2013:
https://www.youtube.com/watch?v=dZINKG-gPT0
https://www.youtube.com/watch?v=dZINKG-gPT0
Edit it to "secret bets" or even "non publicly announced".
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.
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.
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?
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?
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.
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.
I think that is a completely fair assumption, you may be right. Partly why I think we should dramatically increase the numbers of representatives is to mitigate this problem somewhat. On average, I think a lot of regular citizens would do just fine. So we limit the damage by limiting the amount of power a single vote has.
It's kind of the same reasoning I use for extending the vote to children. In a country of 330 million, each individual vote is nearly meaningless on it's own so I figure the risk is much lower than the benefit of getting people involved at a younger age in a future that they should care deeply about. HN did not collectively appreciate this suggestion when I made it, however :).
It's kind of the same reasoning I use for extending the vote to children. In a country of 330 million, each individual vote is nearly meaningless on it's own so I figure the risk is much lower than the benefit of getting people involved at a younger age in a future that they should care deeply about. HN did not collectively appreciate this suggestion when I made it, however :).
[deleted]
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.
Granted, neither do a significant percentage of the currently serving congress if current policy is anything to go by.
> 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.
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.
> 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
unfortunately, this is also true of our elected officials
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?
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?
Perhaps have a third stage (after the senate) that is the sortition that has to approve a bill.
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)
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)
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. With the 17th Amendment and binding primary elections we threw out that wisdom.
> 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.
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.
> 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.
> 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.
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.
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.
The self-same perfect and wise and gosh-darn handsome founders included an amendment mechanism. You might like to take your complaint up with them.
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.
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.
The problem here is that they then will have do depend even more on others than people who choose the job do, which shifts the problem one ring out. So this will give more influence to lobbyists, who know their areas well and are experts in talking people into things. There's also the problem of staff. Politicians tend to bring key staff along with as they rise. But where will randomly selected legislators find a half-dozen people with the necessary knowledge and skills?
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.
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.
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.
If you took away the politicians way of getting rich then what motivation would people have to be politicians? /s
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.
Some people actually care.
That's awesome. I voted for a person for Mayor of Chicago last year who I know cared. They got ~1000 votes.
Power!
I don't like this corruption, but there are many worse things our rulers could do.
I don't like this corruption, but there are many worse things our rulers could do.
[deleted]
Politicians should take a vow of poverty, agreeing to never spend more in a year than the average American. Great way to weed out all of the sharks and keep only the people who actually care and want to lead the country in the right direction, whatever that takes.
The nature of politics tends to attract the very kind of people that you don't want in politics.
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.
Are these the rules when you work for a bank to avoid the appearance of conflict of interest? How come congress members don't have similar rules
I work in a bank, at a low level. These trades would have gotten me fired.
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.
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]
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!
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!
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.
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.
> 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.
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.
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...
https://www.nytimes.com/interactive/2020/10/10/us/trump-prop...
[deleted]
Why don't you tell us what you Googled for without being able to find anything.
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.
This is a closed system, and most are not allowed anywhere near the control room.
It, including these trades, is working as intended.
The US is explicitly not about the majority. The Senate and Presidency are both anti-democratic institions where land controls votes.
> 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.
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.
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.
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...
"...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...
> 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.
I mean the American revolution was spearheaded by wealthy land and slave owners who were tired of taxes.
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.
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.
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.
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=...
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.
Relative to their peers though: Alphabet went up almost 8% the same day, clearly not due to Microsoft's VR contract.
[deleted]
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.
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
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
This falls under misappropriation which does not require the reader to any relationship to the company being traded, only material, non-public information.
I'm not aware of any case law finding that Congress using their knowledge is misappropriation. Do you have any examples to the contrary?
Well they aren't legally insiders because... they made the rules.
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.
>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.
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.
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.
I have no position on your 2nd sentence. I agree in philosophy but acknowledge the details are complicated.
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.
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.
"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"
No it's not. If you grant that Nancy Pelosi should be treated similarly to a corporate insider, then it is pretty obvious that her spouse should be treated like an insider's would be.
No it's not. If you grant that Nancy Pelosi should be treated similarly to a corporate insider, then it is pretty obvious that her spouse should be treated like an insider's would be.
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.
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.
In addition to possibly using inside information, they also make the news, ie. potentially profit from policy news that they themselves are making.
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...
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...
> 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
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
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.
If you only have W2 income and take the standard deduction, 99% of what you need to know they know. Only changes like new address, dependent, etc would really be relevant.
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.
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.
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
How quickly are these trades made public? Maybe we should just copy the congress people's trades and make some profit ourselves :P
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.
The problem with Pelosi and others is that the money comes from abusing their power, and is in effect taken from other investors.
I don't agree, I think that tax load after 100 million (or some similar ridiculous figure) should be ludicrously high. Taxes never stopped rich people from wanting to become richer, lets just make it a bit harder and put that money back into circulation.
The most amazing thing is that these people keep getting re-elected. The voters are the ones allowing this to happen.
> 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.
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.
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.
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.
> 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.
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.
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?
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?
I totally agree with you -- I was trying to explain the thought process that I think is going on in some peoples' heads.
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.
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.
If I buy some MSFT shares on the market, is my money being put to use by Microsoft? I see this kind of sentiment all the time but it seems to rely on a VC model of investment where you’re buying shares from the company/founders. I am dumb about this stuff so please someone correct me.
Only in an IPO or other public issue really.
What happens is your money goes to whoever owned the shares and they use it somehow. That same money could theoretically be used to buy shares infinitely, except for fees, and the company would see none of it.
The effect on the company though is demand will drive the price up. Shareholders like higher prices so tend to reward CEOs who get them. This (hopefully) leads to an efficient company where they try their best so shares go up in value due to present or expected future performance which is good for the economy on the whole compared to having a bunch of inefficient companies.
What happens is your money goes to whoever owned the shares and they use it somehow. That same money could theoretically be used to buy shares infinitely, except for fees, and the company would see none of it.
The effect on the company though is demand will drive the price up. Shareholders like higher prices so tend to reward CEOs who get them. This (hopefully) leads to an efficient company where they try their best so shares go up in value due to present or expected future performance which is good for the economy on the whole compared to having a bunch of inefficient companies.
It's true for shares at issuing. After that, typically, the company sees no funds from shares changing hands. Folks buy shares because they want dividends or capital appreciation. A few to show up at AGMs. But after the shares change hands once, the idea that the Noble Capitalist Heroes Of Galt's Gulch make the world turn by purchasing shares is false.
Companies can issue shares down the road, and they do for compensation, so people buying shares and pushing the stock price up is actually an ongoing assist. But, yes it's complex.
I agree with everything you say. My argument is not that investment is bad, but that as your wealth increases, your interest in getting even richer should decrease, and your interest in getting non-financial returns should increase.
If you have $100 million dollars, and you're investing in the stock market purely because that's the way to get the highest financial return, that is not rational, unless money is literally the only thing you care about. Presumably there's something else you care about, like the environment, or some political movement, or eradicating malaria, in which case investing all of your money in making more money is not the best choice. You probably still want to invest some of it, to maintain your lifestyle and maintain enough cash to use for the stuff you really care about.
If you have $100 million dollars, and you're investing in the stock market purely because that's the way to get the highest financial return, that is not rational, unless money is literally the only thing you care about. Presumably there's something else you care about, like the environment, or some political movement, or eradicating malaria, in which case investing all of your money in making more money is not the best choice. You probably still want to invest some of it, to maintain your lifestyle and maintain enough cash to use for the stuff you really care about.
Sure, if you have better uses for the money, put it to work. Most people don't, so ingesting in the stock market is totally rational.
At te very least with a good chunk of it. Again diversification is good.
At te very least with a good chunk of it. Again diversification is good.
> Most people don't
This is the crux of the issue. If you have $100 million and you can't think of a single worthwhile use for any of it besides making more money, that's either a literally unbelievable lack of imagination, or incredibly cruel. It is so, so easy to do a huge amount of good with that much money. It's not easy to figure out how to do the most amount of good possible, that's probably an unsolvable problem, but it's not necessary.
I understand that investing in the stock market is supporting the economy and increasing liquidity and potentially helping a company and that's all good, but it is laughably easy to think of something better, if you don't need to worry about a financial return.
This is the crux of the issue. If you have $100 million and you can't think of a single worthwhile use for any of it besides making more money, that's either a literally unbelievable lack of imagination, or incredibly cruel. It is so, so easy to do a huge amount of good with that much money. It's not easy to figure out how to do the most amount of good possible, that's probably an unsolvable problem, but it's not necessary.
I understand that investing in the stock market is supporting the economy and increasing liquidity and potentially helping a company and that's all good, but it is laughably easy to think of something better, if you don't need to worry about a financial return.
[deleted]
I'm all for people donating money, but they don't have to. It's theirs and they get to do what they want with it, without the burkamans of the world guilt tripping them. If they want to invest their savings until such a time as they have something better to do with it, more power to them.
After all, you wouldn't want me telling you how to spend your money.
After all, you wouldn't want me telling you how to spend your money.
I think a reasonable amount of guilt tripping is healthy for a society. Obviously hoarding money shouldn't be illegal, but it should feel like anti-social behavior that most people disapprove of. It's like signing up to be an organ donor, or getting vaccinated, or being friendly to your neighbors. You shouldn't be forced into anything, but you should be socially pressured to make the choice that benefits your community.
I agree with you, but I don't like the argument.
Something of it smacks of hypocrisy. I think you should be guilted into donating 5% of your wealth by that reasoning. Yeah you don't have 100M, but just like them a 5% donation won't materially affect your quality of life. How do you feel about that? Do you still feel it's anti social behavior not to do that?
Because I call hypocrisy otherwise.
Something of it smacks of hypocrisy. I think you should be guilted into donating 5% of your wealth by that reasoning. Yeah you don't have 100M, but just like them a 5% donation won't materially affect your quality of life. How do you feel about that? Do you still feel it's anti social behavior not to do that?
Because I call hypocrisy otherwise.
Yes, I'm doing pretty well as an American software engineer, I should be pressured to donate some of my wealth (and I do). It's not a flat rate for everyone though, it's like tax brackets - as your wealth increases, you're expected to contribute a higher percentage back to the community. In a perfect world, taxes would be enough, and charity would be unnecessary because we'd all agree about how to fix all the problems in the world and just set tax rates accordingly. Obviously this is impossible, but in a slightly less perfect but maybe achievable world, we'd use taxes to cover issues with really broad agreement, and more fluid social norms to encourage charitable giving to cover the rest. In my view, there's not much moral difference between technically legal tax avoidance (like offshore accounts or tax inversion) and hoarding excessive wealth while people in your community are dying because of poverty.
> It's being put to use by the companies and institutions you invest in to provide products and services.
Only if you pretend that all stock trades happen when new stock is issued. That definitely isn't the case. As far as I understand there is a lot of trading between portfolios, where the company that originally issued the stock doesn't necessarily benefit except by increasing the value for future stock issues.
Only if you pretend that all stock trades happen when new stock is issued. That definitely isn't the case. As far as I understand there is a lot of trading between portfolios, where the company that originally issued the stock doesn't necessarily benefit except by increasing the value for future stock issues.
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, and their loans? You talk about it and if it's a given. It's not.
Why is that better than these companies living off their profits, and their loans? You talk about it and if it's a given. It's not.
You've got a fringe position there. If you want to defend it, be my guest. I believe it's pretty obviously a given. You're basically picking a fight with capitalism which, while far from perfect, it's the best system we've tried to date.
You're basically picking a fight with capitalism
That's a straw-man. I've said nothing questioning capitalism. The stock market isn't a necessary component of capitalism any more than subprime lending is.
The cost of the stock market is clear. The stock market causes and amplifies inequality. This isn't controversial.
But I find proponents of the stock market have trouble defending it, when asked to really be clear about the benefit to society -- to people.
That's a straw-man. I've said nothing questioning capitalism. The stock market isn't a necessary component of capitalism any more than subprime lending is.
The cost of the stock market is clear. The stock market causes and amplifies inequality. This isn't controversial.
But I find proponents of the stock market have trouble defending it, when asked to really be clear about the benefit to society -- to people.
> That's a straw-man. I've said nothing questioning capitalism. The stock market isn't a necessary component of capitalism any more than subprime lending is.
The stock market, no, but the ability to invest/allocate capital is quite fundamental to capitalism. The stock market is merely one incantation of that. Let's take your criticism as only pertaining to the stock market.
> The cost of the stock market is clear. The stock market causes and amplifies inequality. This isn't controversial.
I'm not going to give you that one. The stock market enables the public to invest in these companies. That's why they're called public companies.
If you ditch it, suddenly only wealthy venture capitalists can do that. This has been happening more and more with companies starting private longer and longer thanks to abundant private capital that doesn't bring the onerous regulations of being a public company. Unfortunately that seems to be increasing inequality, as the public has been cut out of these kinds of riskier but high growth investments.
I'm sure there is a better way of doing it, but it isn't as cut and dried as you suggest.
The stock market, no, but the ability to invest/allocate capital is quite fundamental to capitalism. The stock market is merely one incantation of that. Let's take your criticism as only pertaining to the stock market.
> The cost of the stock market is clear. The stock market causes and amplifies inequality. This isn't controversial.
I'm not going to give you that one. The stock market enables the public to invest in these companies. That's why they're called public companies.
If you ditch it, suddenly only wealthy venture capitalists can do that. This has been happening more and more with companies starting private longer and longer thanks to abundant private capital that doesn't bring the onerous regulations of being a public company. Unfortunately that seems to be increasing inequality, as the public has been cut out of these kinds of riskier but high growth investments.
I'm sure there is a better way of doing it, but it isn't as cut and dried as you suggest.
"normal and rational" is different from "ethical or moral".
"All wealth levels" are not the same.
"All wealth levels" are not the same.
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.
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?
Which is what these politicians seem to be doing. Sure it is not illegal, but is it ethical?
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.
It fails to comply in either case.
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.
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.
> 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.
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.
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.
Last I checked couple years ago, she was worth $140 million. She's worth even more now.
I am not against non politician people having tons of money. I am against politicians getting rich using insider trading. And the same politicians also accusing their political opponents of doing the very thing they are doing themselves - even more. Hypocrisy and double standards is what makes me disgusted.
There's not a single profession I can think of where someone would gladly be working when they are 80 years old. House and Senate needs term limits. 8 years max. No one should be allowed to become a life long politician and get rich off of it.
But unfortunately, what we want is different from what we get. There's no way these politicians will pass bills to limit their own terms. These people convince the ordinary people that they are all moral and care about them. But meanwhile they are getting rich off of public's trust in them.
I am not against non politician people having tons of money. I am against politicians getting rich using insider trading. And the same politicians also accusing their political opponents of doing the very thing they are doing themselves - even more. Hypocrisy and double standards is what makes me disgusted.
There's not a single profession I can think of where someone would gladly be working when they are 80 years old. House and Senate needs term limits. 8 years max. No one should be allowed to become a life long politician and get rich off of it.
But unfortunately, what we want is different from what we get. There's no way these politicians will pass bills to limit their own terms. These people convince the ordinary people that they are all moral and care about them. But meanwhile they are getting rich off of public's trust in them.
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.
(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.
Clearance time varies but can take months. They've already collected profits by the time they are disclosed
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...
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...
I think this is just one way in which many politicians are the same. This does not mean that they share all the same concerns or have the same plans for the country.
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.
It’s easy to have low inequality when everyone is very poor like West Virginia.
Obviously having access to insider information and trading based on that information is not okay, but the specific trade called out here does not sound like the sort of thing a person would do if they had information about future movement of the underlying $MSFT.
They traded deep ITM calls 4 months out for deeper ITM calls 1 month out. My guess is that this particular trade is part of a risk management strategy, not an adjustment based on insider information.
They traded deep ITM calls 4 months out for deeper ITM calls 1 month out. My guess is that this particular trade is part of a risk management strategy, not an adjustment based on insider information.
Yeah that didn’t make sense to me either. It sounds like the author isn’t very knowledgeable about how options work.
There is zero reason for congresspersons to trade options or really even any individual stocks. The optics are horrific.
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.
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.
I know that in the front office in certain investment banks, you're not allowed to trade single stocks for your own account. You can only trade funds. I think a similar rule here might work.
Frankly, it's insider trading and should be restricted/prosecuted as such.
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_...
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_...
There will almost always be plausible deniability. Needs to be banned.
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.
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.
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.
"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.
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.
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.
Again though there's plausible deniability, as you say. It needs to just be outright banned.
[deleted]
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.
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.
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?
Does anyone know?
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.
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.
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.
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.
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.
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?
>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.
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.
What they said was objectively true, regardless of your opinions for or against the situation.
The SEC has long been selective about which rules they enforce and when.
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.
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.
Disclaimer: not American, no strong opinion on these people.
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.
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.
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)?
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)?
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.
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.
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.
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.
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.
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.
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.
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.
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.
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
> 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.
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.
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...
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...
Why is this being downvoted? These are references to primary sources that directly contradict facts presented.
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
Some democrats were urging her to accept it in October: https://twitter.com/AndrewYang/status/1315078896853843970
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.
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.
> the HEROES act
Does anyone else cringe at this American obsession with naming acts of congress so as to create "inspirational" acronyms?
Does anyone else cringe at this American obsession with naming acts of congress so as to create "inspirational" acronyms?
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.
calylex(1)
>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.
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.
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.
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.
> 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?
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?
I believe GP is defending facts against malicious lies. That seems always a good thing, regardless of whom the lies are directed towards.
Yes, exactly. This is the kind of obviously disprovable lie that I though wouldn’t fly on HN.
> malicious lies
just call it a lie. don't need biased adjectives.
just call it a lie. don't need biased adjectives.
I don’t think that’s a biased adjective. It describes the author’s intent in distributing an easily disprovable lie. Their intent was malicious.
>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.
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.
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.
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.
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.
But then you'd own the option so you'd benefit from the volatility and can quickly cash out, right?
Yes, you cash out the options when the IV spikes when swings up.
So, back to the original question: wouldn't OTM options make more sense in their position?
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.
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.
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.
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.
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.
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.
I personally don’t think it was insider trading so in that sense I completely agree with youx
Oligarchy in the U.S. is giving my mother country (Nigeria) a run for its money.
Don't be silly. The U.S. is infinitely more corrupt than Nigeria. Forgive me, but there's just no comparison.
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).
Wait until you see how much she got paid to build a few miles of railroad.
Rules are for thy not for me.
Congress insider trading is not new. Peter Schweitzer’s book “Throw all of them out” details them. The book was released in 2011.
How is this an acceptable. Is politicians above the law?
Congress insider trading is not new. Peter Schweitzer’s book “Throw all of them out” details them. The book was released in 2011.
How is this an acceptable. Is politicians above the law?
Is it possible to see how much has each member of congress profited/lost doing trading over time?
We can build a tool like this right? As all the data in public?
Yep. The very people we elected and who are supposed to answer to us are fleecing the American public. This needs to be investigated further by the SEC.
To provide an additional example. Unelected ex-senator Kelly Loeffler's husband is chairman of the New York Stock Exchange. She made trades using non-public information. How is this sort of conflict of interest legal?
https://www.politifact.com/factchecks/2020/oct/31/raphael-wa...
https://www.politifact.com/factchecks/2020/oct/31/raphael-wa...
The fact that high-ranking politicians and bureaucrats can trade stocks at all is criminal. The moral hazard is unbelievable.
Yes it's the definition of conflict of interest. It's insane that this is allowed
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.
The state and large corporate interests in the USA are very tightly integrated and have been for at least an entire generation.
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
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.
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.
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.
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.
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.
> 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.
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.
The US was more democratic after the revolution than before. Since then the trend has been in that direction, largely because those kinds of principles are baked into the constitution.
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.
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.
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]
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.
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.
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.
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.
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.
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.
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.
Isn't that completely fake though? Pelosi was pushing stimulus for months. And the negotiations were all very public. Trump and McConnell were holding it up.
Here's a recent Pelosi options trade with the Microsoft AR contract announcement. [0]
[0]: https://www.thestreet.com/mishtalk/economics/nancy-pelosis-h...
[0]: https://www.thestreet.com/mishtalk/economics/nancy-pelosis-h...
> This is fucking unreal.
It's USA. Corruption is the norm.
It's USA. Corruption is the norm.
This is fucking unreal.
How do you think so many people on government salaries become super rich, whilst supposedly working for the government?
How do you think so many people on government salaries become super rich, whilst supposedly working for the government?
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.
Great. Why does she have to buy shares in companies that align with her "switching"?
Members of congress should only be allowed to invest in SPY/VOO, VTI, and a few other broad ETFs, long only, no options.
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.
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.
"... 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.
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.
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...
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 ...
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.
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.
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.
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.
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.
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.
What about their friends and families?
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.
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).
How about electing honest people, instead of constantly voting for the establishement (w. a few exceptions).
(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.
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.
Those are very good points. I actually always thought that I am good at detecting dishonesty, but after I fell for a narcicist/sociopath in my last job I am not claiming that any more.
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.
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.
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.
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.
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.
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.
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.
Meanwhile ordinary people still believe that the war is against their fellow people, in identity politics, religion, sexual orientation etc. Devide et Impera.
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.
> 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.
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.
"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.
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.
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.
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.
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.
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.
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.
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?
> 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.
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.
Our top officials are compensated to the tune of 174,000 which is 95th percentile. Making people wealthier doesn't make them more honest.
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,
https://unusualwhales.com/i_am_the_senate,
How else is Pelosi expected to afford her $20k sub z fridges filled with 13 dollar a pint ice cream?
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
https://pressgallery.house.gov/member-data/salaries
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)
($250k is like $160k take home with her home town taxes. 20/160 = 0.125)
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.
Are any of the things in your garage 10-20x the average cost of that thing? That fridge is like the Lamborghini of fridges.
I'm not saying buying something that is 12.5% of your take home income is unreasonable. After all, I own a car. I'm saying that buying a fridge at 12.5% of your take home income is unreasonable.
I'm not saying buying something that is 12.5% of your take home income is unreasonable. After all, I own a car. I'm saying that buying a fridge at 12.5% of your take home income is unreasonable.
Why? This is just a statement of your priorities that you are projecting onto someone else, and then judging them for it. Not everyone has your set of priorities. When I was in gradschool I bought a $1000 dollar fridge. That was probably ~10% of my take-home, because I believe you get what you pay for. Am I "unreasonable"? Maybe according to you, but I'm fine with my decision.
If you're going to expend effort judging someone, judge them by their deeds, not by the appliances they buy.
If you're going to expend effort judging someone, judge them by their deeds, not by the appliances they buy.
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.
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.
Not bad! I wish we could have that info in real time!
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.
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.
why doesn't someone create an index fund that just track congressional trades?
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 :-)
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 :-)
> 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.
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.
lot of them banning crypto or requiring disclosure as well
Why would they?
They only restrict me due to concerns about insider info...and I certainly don't know where bitcoin is going tomorrow based on my decidedly non crypto finance day job
They only restrict me due to concerns about insider info...and I certainly don't know where bitcoin is going tomorrow based on my decidedly non crypto finance day job
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.
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.
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?
Heck, I could cough once for buy, twice for sell. Who's going to surveil me and notice that?
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.
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.
That's not what insider trading is. Insider trading is specifically using non-public information about a company to make investment decisions.
Technical analysis generally uses only publicly available information; it's finding patterns in those publicly available data that can help you make investment decisions.
I'm not saying it's socially useful; just that it is distinct from insider trading.
Technical analysis generally uses only publicly available information; it's finding patterns in those publicly available data that can help you make investment decisions.
I'm not saying it's socially useful; just that it is distinct from insider trading.
well... Kinda. Proprietary data feeds that you have to pay big money for is totally a thing. I wouldn't call that public information.
Additionally, with hft data speeds matter and exchanges only allow co-location of servers to 'premier firms'.
Additionally, with hft data speeds matter and exchanges only allow co-location of servers to 'premier firms'.
Somewhat, but even the non-insiders still do pretty well. My returns over the last few years are much more than I deserve, and I just have 401k/mutual funds. Maybe they would have been higher without these insiders, but probably not immensely.
Yes, literally.
this is the guy who spams literally all of chamath's tweets and everyone else in involved with finance and investing
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-...
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-...
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.
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.
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.
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.
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.
Clear corruption.
https://www.youtube.com/watch?v=xNDHiiJaxes
https://www.youtube.com/watch?v=xNDHiiJaxes
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
https://www.politico.com/news/stories/1111/67593_Page2.html
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.
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.
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.
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
[1] https://www.house.gov/representatives/find-your-representati...
[2] https://www.senate.gov/senators/senators-contact.htm
It will be fun to have an index fund tracking this. Can’t beat the corruption? Just buy their market!
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.
> 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.
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.
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.
Isn't there a delay in seeing these trades? They're reported 2 months after they happen, right?
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?
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?
What the hell is with the interface on this site? I can't select text, everything is acting funny...
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.
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.
Those evil republicans and their greedy capitalist agenda! Oh wait, both sides do this? Wait, the Democrats do it more?
Just ban stock trading by members of Congress, jfc.
More importantly, let's not forget that capital gains are taxed at a lower rate than income. How convenient.
> House members are outperforming market averages
Some of the specific cases are compelling but it doesn't seem particularly surprising that one year's worth of relatively spectacular returns in many top sectors results in outperforming the market averages.
There are many many people who far outperformed the market averages by the end of 2020.
Some of the specific cases are compelling but it doesn't seem particularly surprising that one year's worth of relatively spectacular returns in many top sectors results in outperforming the market averages.
There are many many people who far outperformed the market averages by the end of 2020.
A lot of people here are suggesting that politicians should not be able to own any stock. I am sure that we can agree that the talent follows the money. I also assume we can agree that we need the best and the brightest in our government (as opposed to working at FAANG). My suggestion would be to pay good people a million bucks per year and multiples of that on top of it if they meet their campaign promises. I personally wouldn't mind if our politicians made 10x of what they make today, since that way we would hopefully attract more candidates and end up with better talent. Let's just make sure that the money they make is not driven by corporate interests.
What happened to the FBI? I feel like this is the sort of thing they should be doing.
Elected officials of all stripes and all levels should have the same trading constraints employees of Wall Street banks have:
-30 day lockup on all trades
-DOJ should be listed as interested party on all House/Senate market participants.
Unfortunately, our DOJ has been working on fugazy matters while antitrust laws are ignored and obvious market manipulation offenses by elected officials are of no interes seemingly.
Unfortunately, our DOJ has been working on fugazy matters while antitrust laws are ignored and obvious market manipulation offenses by elected officials are of no interes seemingly.
Is there an index or ETF that tracks what the House does? I'd love to invest in that.
Don’t worry everyone. The people who fumbled getting us all the help we needed the last year know what they’re doing. /s