I was having trouble getting through the maze of popups even with (or because of?) ublock set to aggressive so https://archive.is/wXjiI
Redditors are right about the unfairness of the market
31–40 of 233 posts
Re: Redditors are right about the unfairness of the market
#32Earlier quoted context omitted.
This doesn't begin to address the issue. E.g. if you work at the fed you buy a 3x treasury index fund if you know rates will be lowered, or short 3x treasury index if you know rates will be raised. If you are a judge or legislator and you get to say if 30% charge on app stores is reasonable, this affects 20% of the Nasdaq 100 index. So you buy/sell that over a 24 hour period.
A couple possible solutions: Disallow them from being directly involved in investment decisions. Make them hand their money over to someone who will make investments on their behalf with influence limited to broad things like risk profile and the term they want returns over. Alternatively, implement a minimum holding period. It's much harder to trade on insider info if there must be a long period of time from purchas…
Almost seems like it could be a giant captive market for some specialized funds. Like if you’re in one of these positions you can invest with a new hedgefund without needing to be a qualified investor.
Re: Redditors are right about the unfairness of the market
#33I understand that people shouldn't benefit from insider information for their personal trading - but there are rules around this. Blanket banning stock trading has a lot of downsides. Its an important part of everyone's financial wellbeing - esp if you are wealthy or powerful. I left my job in financial industry primarily because of this.
Public service used to be thought of as a sacrifice for the good of all people. For many people it is. Teachers, social workers, public defenders, armed service people. All of these people make a pittance compared to what they could in the private sector.
Saying a congressperson or a judge should be allowed to trade stocks simply because it affects their well being is an argument that appears rather frail. I would be surprised if there is anyone in those positions of power either elected or appointed who would be considered to be even slightly financially disadvantaged. If they want to be wealthy, let them go back to work as attorneys or whatever profession they came from.
Re: Redditors are right about the unfairness of the market
#34Earlier quoted context omitted.
at least consider a ban on stock buybacks like was the case until that regulation was rolled back in the 80s.
There's nothing really wrong with stock buybacks. They're just a tax efficient method for companies without strong growth opportunities to return value to shareholders.
Presumably GP is worried that (with the company's inside information about itself) there is a strong growth opportunity, as it will turn out, and that the company might decide to reissue once it's realised that growth.
Not saying I really agree, they typically offer a premium (which is just like rolling a dividend into it) and it would seem highly unusual to have a company that seemed growth/non-growth according to whether you had inside information.
I suppose there might be examples like AMC or GameStop (not that, inside information wouldn't have helped you there!) that seemed on the outside to be dying, they absolutely should return or value to shareholders and cease operations; but actually they had ambitious plans to revitalise etc...
Re: Redditors are right about the unfairness of the market
#35Earlier quoted context omitted.
A redditor publicly posting "Buy and Hodl" isn't unfair in anyway. Everyone in the world can read that comment at exactly the same time and act based upon it.
Piling into high gamma strikes at the same time to force a dealer squeeze is a bit more than expressing a view that an asset is undervalued. I'm not defending either side here, but Reddit has picked a fight that is absolutely tantamount to market manipulation.
But how can you tell the difference between people following dumb advice on the internet and people intentionally manipulating the market? It isn't illegal to be an idiot.
It is pretty obvious that lots of people try to post on reddit to make their assets more valuable, but I am pretty sure that many of them are conventional investors. There is no reason for any of the old big players to not post these things on reddit, I don't see how having the power of reddit could trump having the power of reddit + the power of controlling the marketplaces. When unwanted things happens based on reddit manipulation they shut down the market, when things go as they want the market stays open, so it seems like they can't lose under the current rules.
Re: Redditors are right about the unfairness of the market
#36Money printing and the Cantillion effects associated with it have created asymmetric playing fields which are fundamentally unfair. The injustice of modern markets can be explained with an analogy: Imagine that you don't have much money and you open a coffee shop; assume that it's your only stream of income... Now imagine that a few years later, a multi-millionaire opens up a coffee shop right next to yours as a pass…
I've seen this dynamic play out in my small city with breweries. The wealthy class opened breweries in order to revitalize neighborhoods they had bought large amounts of property in, and they ended up making profits on the scale off $100 million. The breweries were never intended to be profitable on their own, they were only intended to be window dressing on an industrial area. It's no coincidence that the owners of the breweries have the same last names as many of the wealthiest and most influential families in the area, and it's no coincidence that some of those same names show up on a number of plantations that were here 200 years ago.
Re: Redditors are right about the unfairness of the market
#37I was having trouble getting through the maze of popups even with (or because of?) ublock set to aggressive so https://archive.is/wXjiI
Weird, even when I disable uMatrix and Firefox ETP to leave it to just uBlock I get no popups? Maybe they advertise more heavily based on geolocation?
Re: Redditors are right about the unfairness of the market
#38I understand that people shouldn't benefit from insider information for their personal trading - but there are rules around this. Blanket banning stock trading has a lot of downsides. Its an important part of everyone's financial wellbeing - esp if you are wealthy or powerful. I left my job in financial industry primarily because of this.
> Its an important part of everyone's financial wellbeing
But should it be?
It seems to me this is part of the problem: the outsized role the stock market plays in our financial system today.
Re: Redditors are right about the unfairness of the market
#39I understand that people shouldn't benefit from insider information for their personal trading - but there are rules around this. Blanket banning stock trading has a lot of downsides. Its an important part of everyone's financial wellbeing - esp if you are wealthy or powerful. I left my job in financial industry primarily because of this.
Public service used to be thought of as a sacrifice for the good of all people. For many people it is. Teachers, social workers, public defenders, armed service people. All of these people make a pittance compared to what they could in the private sector. Saying a congressperson or a judge should be allowed to trade stocks simply because it affects their well being is an argument that appears rather frail. I would be…
If anything, you would want elected officials to be invested in their country as a whole, so indexed funds and stuff like that. Yes they are lower risk, but they also reflect how a larger group of companies are doing vs the ones they have first hand information about.
Re: Redditors are right about the unfairness of the market
#40Earlier quoted context omitted.
There's nothing really wrong with stock buybacks. They're just a tax efficient method for companies without strong growth opportunities to return value to shareholders.
Presumably GP is worried that (with the company's inside information about itself) there is a strong growth opportunity, as it will turn out, and that the company might decide to reissue once it's realised that growth. Not saying I really agree, they typically offer a premium (which is just like rolling a dividend into it) and it would seem highly unusual to have a company that seemed growth/non-growth according to w…
> with the company's inside information about itself
a company acts in the interest of its shareholders.
If you're saying that a majority shareholder hides this info from the rest of the shareholders, triggers a buy back under a false pretense, then realize that growth (making the share worth more), then that's just financial fraud.
If a company has an opportunity for growth, this information is unlikely to be private to the shareholders, and thus, the buyback would price in that possibility (discounted by the success rate and risk). So the scenario, where a company buys back shares (from current shareholders), then somehow improves it's performance/growth suddenly, is not likely.