Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Making Insider Trading Legal

newyorker.com

Post reply on HN
Print view View original

31–40 of 169 posts

Re: Making Insider Trading Legal

#31

Post by dllthomas »

runn1ng wrote: post #24

Not related to the actual article, but I got stuck on the word "coöperating". Originally, I thought the "Umlaut" is a typo or a mistake, but, according to wiktionary, "coöperate" is an actual word! I still feel like pronouncing the second "ö" like in German though.

https://en.wikipedia.org/wiki/Diacritic#English

"English speakers and writers once used the diaeresis more often than now in words such as coöperation (from Fr. coopération), zoölogy (from Grk. zoologia), and seeër (now more commonly see-er or simply seer), but this practice has become far less common. The New Yorker magazine is a major publication that uses it."

Re: Making Insider Trading Legal

#32

Post by beachstartup »

lambdapie wrote: post #22
jessaustin wrote: post #11

Unfortunately the headline is mistaken. Insider trading law was only ever intended to reserve for senior executives the privilege of trading on inside information. This latest interpretation is a confirmation of that purpose, not a repudiation of it. Bharara has been a true believer, but if he's going to stray from the South Asian beat, he's going to have to learn the real rules.

What does "if he's going to stray from the South Asian beat" refer to?

probably just your standard garden-variety racism.

Re: Making Insider Trading Legal

#33

Post by jessaustin »

lambdapie wrote: post #22
jessaustin wrote: post #11

Unfortunately the headline is mistaken. Insider trading law was only ever intended to reserve for senior executives the privilege of trading on inside information. This latest interpretation is a confirmation of that purpose, not a repudiation of it. Bharara has been a true believer, but if he's going to stray from the South Asian beat, he's going to have to learn the real rules.

What does "if he's going to stray from the South Asian beat" refer to?

Perhaps I'm influenced by those cases that the news media has chosen to publicize. Clearly Mathew Martoma would still be "guilty" under the newly-clarified rules. I really wonder about e.g. Raj Rajaratnam, Anil Kumar, or Rajat Gupta, however.

Re: Making Insider Trading Legal

#34

Post by dllthomas »

Dylan16807 wrote: post #10
notacoward wrote: post #7

Earlier quoted context omitted.

> It becomes illegal to do thorough research. Ridiculous. Having access to information others don't is privilege, not thoroughness. You can be just as thorough as you want, so long as others are not prevented from being likewise. Without that, capital markets cease to be open. That way lies oligarchy.

You can figure out information other people don't have through pure diligence, without privilege.

Required diligence doesn't make information non-public.

Re: Making Insider Trading Legal

#35

Post by bobcostas55 »

lambdapie wrote: post #21

Insider trading does harm people, and does reduce liquidity. Many people who understand classical economics get this wrong [0], because financial markets are a very degenerate kind of market from the point of view of classical economics. The fundamental error in all cases is to conceptualize insider trading as buying from someone who would have bought/sold anyway . This is precisely failing to think at the margin. It…

You completely ignore the benefit of the more accurate price.

Let's say the price of a share with the inside info is 110. It is now 100. The inside trader does cause some volume that wouldn't have happened otherwise, and moves the price to 105 -- to the detriment of someone who would not have traded otherwise. But then every subsequent trade is at a price closer to the true one, a clear benefit.

It is true that greater information asymmetries will decrease liquidity/widen spreads, but is this a sufficient justification for banning inside trading? Also, information asymmetry is a matter of degree, not a binary thing. A skilled fund manager may have assembled public information (the "mosaic" view) that when put together is tantamount to insider info. You could use the exact same argument to ban him from trading.

Re: Making Insider Trading Legal

#36

Post by pgeorgi »

Tomte wrote: post #23
mstade wrote: post #20

> Many people on Wall Street felt that Bharara’s crusade against insider trading was recklessly broad: An analyst like Horvath might knowingly obtain an illegal tip, but if he feeds his information up the chain to a Steinberg or a Cohen, and they take his word that he is not passing along stolen goods, should they really go to prison for that misplaced faith? Is it fair to convict someone of engaging in insider tradi…

Which country is that? Does "illegal" mean criminal liability or just that the sale is void?

I suppose you already know about §259 StGB in Germany.

(up to 5 years for handling goods that were stolen by somebody else)

Re: Making Insider Trading Legal

#37

Post by jessaustin »

beachstartup wrote: post #32
lambdapie wrote: post #22

Earlier quoted context omitted.

What does "if he's going to stray from the South Asian beat" refer to?

probably just your standard garden-variety racism.

By observing that the USA criminal justice system is racist, I am proving myself to be a "garden-variety" racist? Please, pay more attention.

Re: Making Insider Trading Legal

#38

Post by praptak »

mstade wrote: post #20

> Many people on Wall Street felt that Bharara’s crusade against insider trading was recklessly broad: An analyst like Horvath might knowingly obtain an illegal tip, but if he feeds his information up the chain to a Steinberg or a Cohen, and they take his word that he is not passing along stolen goods, should they really go to prison for that misplaced faith? Is it fair to convict someone of engaging in insider tradi…

Stolen phone doesn't look different from a legit one, you need to actively verify its record. I doubt an insider tip can be honestly mistaken for a legit one.

Which makes the plausible deniability even weaker.

Re: Making Insider Trading Legal

#39

Post by akg_67 »

gus_massa wrote: post #6
kawera wrote: post #3

Same article posted yesterday: https://news.ycombinator.com/item?id=10483032

This was reposted a few times: https://hn.algolia.com/?query=Making%20Insider%20Trading%20L... From the FAQ: > Are reposts ok? > If a story has had significant attention in the last year or so, we kill reposts as duplicates. If not, a small number of reposts is ok. It's not very clear what significant means, but all the previous submissions have 0 or 1 points and no comments. I think that one problem with dupes is th…

I reposted the story after receiving email from mod requesting to repost. Your search list shows that I posted the same story five days ago and appear to be the first one. I guess mods are experimenting with certain stories that they consider good but didn't get traction.

Re: Making Insider Trading Legal

#40

Post by DanBC »

Dylan16807 wrote: post #5
kawera wrote: post #3

Same article posted yesterday: https://news.ycombinator.com/item?id=10483032

I'm sorry you didn't get upvotes out of randomness or timing but it doesn't help to link a previous submission with no comments.

Pointing to the five or so posts of this story helps to highlight the fact that New Yorker[1] gets very many duplicate submissions, most of which get very few comments / upvotes.

Some other sites get similar beneficial multiple submissions.

But many sites don't get this and repeat submissions just count as dupes.

Look at this: https://news.ycombinator.com/from?site=newyorker.com It's crammed full of dupes.

[1] or NYT or WSJ or etc.

Post reply on HN