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I'm not well versed in stock/securities laws, but I would imagine it would have to do with this: http://en.wikipedia.org/wiki/Insider_trading http://en.wikipedi
by sbov 16y ago
I'm not well versed in stock/securities laws, but I would imagine it would have to do with this:
http://en.wikipedia.org/wiki/Insider_trading http://en.wikipedia.org/wiki/Insider_trading
The CEO couldn't possibly take personal calls from every investor after going public. I don't feel particularly bad that someone can't get privileged information from the company that wouldn't be available to other investors. These regulations are for fairness.
- T_S_ 16y agoYou are correct that the CEO cannot favor investors due to SEC regulation and simple fairness. However, the issue raised is that companies use these regs as an excuse to draw the curtains and provide less information on the whole. This is bad for economic decision making on the whole. For example, it leads to greater volatility and securities prices that don't track value. It also places managers into a kind of priesthood with privileged access to information. Abuses ensue.