7 ms·

Not a sympathizer of these idiots who clearly thought that would get away. But what really astonishes me is how SEC is consistently after these retail small pla

Not a sympathizer of these idiots who clearly thought that would get away. But what really astonishes me is how SEC is consistently after these retail small players when members of congress and its different committees are brazenly involved in insider trading and no one bats an eye. Hell even the Fed itself and its members were involved in trades that could only be explained by insider knowledge. My sense is SEC wants to send the message it is OK if big players do it but small players beware.

swyx 5y ago
well, for one, members of congress are legally allowed to insider trade. pretty convenient laws when you make the laws.
- CharlesW 5y ago
  > well, for one, members of congress are legally allowed to insider trade. Are they? Highlight link: https://en.wikipedia.org/wiki/STOCK_Act#:~:text=The%20law%20prohibits%20the%20use%20of%20non%2Dpublic%20information%20for%20private%20profit%2C%20including%20insider%20trading%20by%20members%20of%20Congress%20and%20other%20government%20employees https://en.wikipedia.org/wiki/STOCK_Act#:~:text=The%20law%20....
  - JumpCrisscross 5y ago
    Spoiler: members of Congress are not allowed to trade on inside information. We haven't yet seen a prosecution, however.
    - dnsco 5y ago
      Why go after congress members making millions when you can go after software engineers making thousands?
paulpauper 5y ago
Because it's not as obvious regarding congress. Person A gets tip, hands to B and makes trade, is a direct link and can be proven in court. Also, Congress has 532 people, so by statistical certainty we should expect some to beat the market.
- carimura 5y ago
  Sure but many are beating the market by making trades on companies that those members are supposed to regulate.
  - harry8 5y ago
    Sure but Pelosi, Feinstein etc etc are so very very clever they'd have become multi-millionaires by them & their partners investing in the market if they didn't regulate those companies. /s
    - joering2 5y ago
      Case of Pelosi comes so often but she is a very weak example. Came from $300,000,000 family fortune "her" stock picks (she obviously doesn't pick herself but has financial firm representing and making moves on her behalf) did merely $6,000,000 in last 10 years, according to her tax statements. I don't get why her "inside trading" and her fridge full of ice-cream triggers so many people; people who clearly haven't done a basic research.
      - mdoms 5y ago
        Unless she is investing 100% of her fortune into stock picking those two numbers are completely unrelated and don't inform the discussion one iota.
      - harry8 5y ago
        Because her husband is the person making their trades? That seems pretty far from "weak" to me. https://www.businessinsider.com/nancy-pelosi-discloses-stock-trades-amid-calls-trading-ban-congress-2022-3 https://www.businessinsider.com/nancy-pelosi-discloses-stock...
JumpCrisscross 5y ago
> even the Fed itself and its members were involved in trades that could only be explained by insider knowledge What's your source for this? We've seen questionably-timed broad-market transactions that yielded a few points. (The officials were fired and the Fed revised its rules.) But nothing that looks like insider trading. The simple answer may be more mundane. Anyone who has spent time on Wall Street or in rule making knows how effective the SEC's systems are at catching insider trades ex post facto. The only seeming way around it is to avoid letting your trades get too profitable. At which point the risk-reward ratio becomes unattractive for anyone with much to lose.

swyx 5y ago

well, for one, members of congress are legally allowed to insider trade. pretty convenient laws when you make the laws.

CharlesW 5y ago
> well, for one, members of congress are legally allowed to insider trade. Are they? Highlight link: https://en.wikipedia.org/wiki/STOCK_Act#:~:text=The%20law%20prohibits%20the%20use%20of%20non%2Dpublic%20information%20for%20private%20profit%2C%20including%20insider%20trading%20by%20members%20of%20Congress%20and%20other%20government%20employees https://en.wikipedia.org/wiki/STOCK_Act#:~:text=The%20law%20....
- JumpCrisscross 5y ago
  Spoiler: members of Congress are not allowed to trade on inside information. We haven't yet seen a prosecution, however.
  - dnsco 5y ago
    Why go after congress members making millions when you can go after software engineers making thousands?

paulpauper 5y ago

Because it's not as obvious regarding congress. Person A gets tip, hands to B and makes trade, is a direct link and can be proven in court. Also, Congress has 532 people, so by statistical certainty we should expect some to beat the market.

carimura 5y ago
Sure but many are beating the market by making trades on companies that those members are supposed to regulate.
- harry8 5y ago
  Sure but Pelosi, Feinstein etc etc are so very very clever they'd have become multi-millionaires by them & their partners investing in the market if they didn't regulate those companies. /s
  - joering2 5y ago
    Case of Pelosi comes so often but she is a very weak example. Came from $300,000,000 family fortune "her" stock picks (she obviously doesn't pick herself but has financial firm representing and making moves on her behalf) did merely $6,000,000 in last 10 years, according to her tax statements. I don't get why her "inside trading" and her fridge full of ice-cream triggers so many people; people who clearly haven't done a basic research.
    - mdoms 5y ago
      Unless she is investing 100% of her fortune into stock picking those two numbers are completely unrelated and don't inform the discussion one iota.
    - harry8 5y ago
      Because her husband is the person making their trades? That seems pretty far from "weak" to me. https://www.businessinsider.com/nancy-pelosi-discloses-stock-trades-amid-calls-trading-ban-congress-2022-3 https://www.businessinsider.com/nancy-pelosi-discloses-stock...

JumpCrisscross 5y ago

> even the Fed itself and its members were involved in trades that could only be explained by insider knowledge What's your source for this? We've seen questionably-timed broad-market transactions that yielded a few points. (The officials were fired and the Fed revised its rules.) But nothing that looks like insider trading. The simple answer may be more mundane. Anyone who has spent time on Wall Street or in rule making knows how effective the SEC's systems are at catching insider trades ex post facto. The only seeming way around it is to avoid letting your trades get too profitable. At which point the risk-reward ratio becomes unattractive for anyone with much to lose.