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DOJ: Hackers broke into an SEC database and made millions from inside info

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161–170 of 198 posts

Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#161

Earlier quoted context omitted.

IMO, everyone's SSN should be public. Mine has already be compromised by both my undergrad and grad school. At this point, I operate under the assumption that it is public knowledge for bad actors. Hiding SSNs is false security at best. If they were public, banks would stop hiding behind "identity theft" and would start having to acknowledge that its their responsibility to confirm who they are lending money to.

The problem with identity in the USA has always been a religious problem more than anything else. All legislation aimed around allowing people to be identified by numbers has been killed due to the whole "mark of the beast" .. "can't buy sell or trade without your number" revelations rhetoric. As religion has less of an impact on people's daily lives, I expect this to change, but in the past it's been the one thing t…

>"All legislation aimed around allowing people to be identified by numbers has been killed due to the whole "mark of the beast" .. "can't buy sell or trade without your number" revelations rhetoric."

This is easy to solve; simply make it illegal to use the identification number so capriciously. Define a narrow use-case for it, narrow enough to allay religious fears, and forbid anything other use if the ID number. Make it illegal to require customers to provide their ID number while making purchases, etc.

But once you do that, most of the desire to implement the system starts to disappear...

Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#162
post #116

Earlier quoted context omitted.

America historically was not very federalized, and being able to just abandon your life and move out west is a key part of the country's mythology, if not the DNA of the country. So there have always been attempts to resist a national ID system, and the SSN was originally not supposed to be used for this purpose. Of course in 2019 this is basically a moot point if you want to be integrated into society, but even then…

I have thought about this a little bit. If this is something Americans believe in, its time to make it official. Make a legal proceeding where you can "start again", so that nobody from your old life can trace you.

Formalizing the process kind of misses the point.

Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#163

Earlier quoted context omitted.

IMO, everyone's SSN should be public. Mine has already be compromised by both my undergrad and grad school. At this point, I operate under the assumption that it is public knowledge for bad actors. Hiding SSNs is false security at best. If they were public, banks would stop hiding behind "identity theft" and would start having to acknowledge that its their responsibility to confirm who they are lending money to.

The problem with identity in the USA has always been a religious problem more than anything else. All legislation aimed around allowing people to be identified by numbers has been killed due to the whole "mark of the beast" .. "can't buy sell or trade without your number" revelations rhetoric. As religion has less of an impact on people's daily lives, I expect this to change, but in the past it's been the one thing t…

Australia doesn't have a national ID number, and neither does New Zealand.

You have a TFN [1] (tax file number) in Australia, which are similar to an SSN, except somewhat more limited. My TFN is only used for income tax, not for identification, and I'm not actually legally required to supply it to anybody, even my employer (although it does make paying taxes a real pain as they withhold the maximum amount). You aren't even legally required to have a TFN, although once you get one you have it for life, and without one you pay the maximum income tax.

TFNs are specifically forbidden to be used for anything other than income or benefit purposes too. Businesses aren't allowed to ask for it as a form of ID.

[1] https://en.wikipedia.org/wiki/Tax_file_number

Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#164
post #157

Earlier quoted context omitted.

It's been pretty well established that insider trading is and has been rampant: https://www.cnbc.com/2018/02/14/insider-trading-is-still-ram...

There's also a not insignificant number of economist who think it would be better if it was legal. Insider trading laws remove information from the system. A common argument is that Enron could have never Enroned without the help of insider trading laws. The big winner here is Wallstreet because the information asymmetry still exists, and they now have the most knowledge that can legally be acted upon. (plus they can…

Layman wondering here: would legal inside trading not encourage the few with the inside knowledge to themselves exhaust the benefit that is to be had from the information, at the expense of everyone else? Including shareholders?

Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#165

People make money off advance information all the time. Often you can see that in the price action -- take this for example: https://imgur.com/mJq1OcY Three days before a positive press release, demand pressure beings to drive up the price. Coincidence? I'm too jaded to believe that.

Where I used to work, there was often a chorus of "they know".

Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#166
post #157

Earlier quoted context omitted.

There's also a not insignificant number of economist who think it would be better if it was legal. Insider trading laws remove information from the system. A common argument is that Enron could have never Enroned without the help of insider trading laws. The big winner here is Wallstreet because the information asymmetry still exists, and they now have the most knowledge that can legally be acted upon. (plus they can…

Layman wondering here: would legal inside trading not encourage the few with the inside knowledge to themselves exhaust the benefit that is to be had from the information, at the expense of everyone else? Including shareholders?

(1) is the best [i think] unbiased analysis I've seen on the subject that tries to look at it from many points of view.

It seems very complicated, and I don't really understand. But it seems like in either cases (legal or illegal) the people who benefits and those who suffers is going to change in every case. For the average investor, in some cases having more efficient stock prices would be a benefit, in other cases, the added information asymmetry would be a unfair.

Three points:

1 - Companies could still ban insider trading if that proved more efficient for them. If liquidity was low because insider trading was allowed, they could disallow it. The reverse is also true. So at least companies would have the choice (and investors would also have the choice of where to invest).

2 - While an insider could equally benefit from good and bad news, they are still incentivized towards positive results (salary, bonuses, keeping their job, reputation)

3 - My real problem with making insider trading illegal is that it's completely impossible to enforce consistently and fairly. This adds uncertainty (how much insider trading is going on in your current investments?) I think insider trading only applies to buying/selling, but what if someone has insider knowledge that causes them to NOT take an action. That seems as unfair but can't be enforced..

(1) https://www.frbatlanta.org/-/media/documents/research/public...

Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#167
post #157

Earlier quoted context omitted.

There's also a not insignificant number of economist who think it would be better if it was legal. Insider trading laws remove information from the system. A common argument is that Enron could have never Enroned without the help of insider trading laws. The big winner here is Wallstreet because the information asymmetry still exists, and they now have the most knowledge that can legally be acted upon. (plus they can…

Layman wondering here: would legal inside trading not encourage the few with the inside knowledge to themselves exhaust the benefit that is to be had from the information, at the expense of everyone else? Including shareholders?

From an economic perspective, insider trading has plenty of nuances.

On one hand, you have the accountants/analysis that build the company numbers to be made public for investors to trade, and because they get the first peek at information that is not really theirs, if they buy/sell on that then they are definitely commiting this act.

On the other hand, you could have Elon musk reading information every day that could sway him to buy or sell at different prices, from the unique vantage point of his position: this is raw information that is better out there than repressed. (investors wuld know what the CEO thinks).

I have an amateurish devotion to economics and insider trading is one space where its all nuance.

Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#168
post #13

Earlier quoted context omitted.

Insider trading is a balance. On the one hand, we want market prices to be accurate. This means we want people with material information to trade on that information. On the other hand, we need some fairness in a market. This is mostly to ensure people keep trading. In a world were inside-info is commonplace, trading without it is just stupid. This would cut off a lot of people from investing. The line needs to be dr…

>This is mostly to ensure people keep trading. In a world were inside-info is commonplace, trading without it is just stupid. I find this line of reasoning hard to swallow. As an individual I have significantly less info than hedge funds and other professionals but that doesn't change the fact that I want to buy Apple or whatever because I think it will grow over the next 5 years. Now if you add in the scenario where…

It is not so much about the retail investors as it is about the professionals. Most of the market is determined by them, in a world without them, prices will less accurately reflect the 'true value' of stocks. As such, we want to keep them trading. We also kind of want to dis-incentivize the professional traders from engaging in massive corporate espionage. Just because that is an arms-race that isn't very productive.

Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#169
post #80

Earlier quoted context omitted.

IMO, everyone's SSN should be public. Mine has already be compromised by both my undergrad and grad school. At this point, I operate under the assumption that it is public knowledge for bad actors. Hiding SSNs is false security at best. If they were public, banks would stop hiding behind "identity theft" and would start having to acknowledge that its their responsibility to confirm who they are lending money to.

Why don't they just assign a new one from time to time? It's just a number after all, much easier to change than fingerprints.

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Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#170

Earlier quoted context omitted.

My understanding is that that warning applied to the card itself, not to the number. That is, the bearer of that card has no provable relationship to the social security number on the card as it contains no attestable information (like a photograph or general description) so the card cannot be used for identification. The number itself is of course used for identification from the beginning as a unique identifier for…

Also, the card has zero anti-forgery technology built into it. Anybody with a printer can make a near-perfect fake.

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