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

Unusual Stock Trading by Whales in US Congress

unusualwhales.com

Post reply on HN
Print view View original

391–400 of 493 posts

Re: Unusual Stock Trading by Whales in US Congress

#391

Post by pc86 »

blunte wrote: post #256
eloff wrote: post #229

Earlier quoted context omitted.

> How much money is enough for these people? :( What kind of attitude is that? If you have savings, one seeks a return on said savings by investing them. That's perfectly normal and rational behavior at all wealth levels.

Let me phrase the question differently: How much money is enough if you already have $100M and to gain more, you have to manipulate and cheat? But even without changing the question, $100M invested in a very low risk manner will generate considerable cash flow (if you regularly take some profits). So without even spending your "savings", you can live very comfortably. However, a special thing happens when you are hig…

Manipulation and cheating is wrong regardless of the amount of money. Tossing the monetary value just aims to inflame passions and try to make an emotional appeal.

Re: Unusual Stock Trading by Whales in US Congress

#392

Post by ABeeSea »

allturtles wrote: post #343
devmunchies wrote: post #308

Earlier quoted context omitted.

> right-wing conspiracies based on outright fabrications maybe on that one point, but the fact the democrats trade way more on the markets is not a conspiracy theory , it's an outright conspiracy. why are you defending these people? because they're democrats on paper?

I believe GP is defending facts against malicious lies. That seems always a good thing, regardless of whom the lies are directed towards.

Yes, exactly. This is the kind of obviously disprovable lie that I though wouldn’t fly on HN.

Re: Unusual Stock Trading by Whales in US Congress

#393

Post by souprock »

wpietri wrote: post #107
sethammons wrote: post #67

Earlier quoted context omitted.

my naive solution: politicians become monks. They go without. They are provided modest housing and budgets. I'm sure there are zounds of issues with it, but I like to imagine servant leaders who go without to do more for the communities they serve.

I'd be happy with that, but perhaps an easier solution is to make them moderately wealthy. Pay them a top 5% salary with a guaranteed pension for life, plus mandatory open finances for life. Then there's much less incentive to resort to graft.

Make that a "top 5% salary" from the pool of Fortune 500 CEOs, and it might do the job.

Re: Unusual Stock Trading by Whales in US Congress

#394

Post by ABeeSea »

onemiketwelve wrote: post #362
ABeeSea wrote: post #307

Earlier quoted context omitted.

If the bet is wrong, OTM options expire worthless. ITM options give you less risk, but for a premium (you buy fewer contracts with the same amount of money). But still with more leverage than outright buying the stock. This is captured in the concept of Delta one of the “greeks” which is a parameter in the black scholes equation and solution that tries to measure the pricing movement of the option relative to the pri…

An insider trade like this isn't about managing risk and things expiring worthless, it's about maximizing expected value while not making it too sus. If you bought a deep itm call, it would behave almost exactly like owning a share. The stock goes up 5% , your call goes up 5% + 1% let's say for the increased iv. If you felt like there was a 75% chance it would go up 5% and a 25% chance it goes flat or down, then your…

I don’t think it was an insider trade. But to use the articles example, Microsoft is so large and diversified that the headset contract news might not swing the stock price. Especially if there is broader negative market news.

Re: Unusual Stock Trading by Whales in US Congress

#395

Post by SavantIdiot »

mLuby wrote: post #389
SavantIdiot wrote: post #316

Earlier quoted context omitted.

You cannot. As long as there are rigged markets and cadres of elites, we can truly do nothing. Sad, really. Not helping the matter is half of the US is below average intelligence and will elect crooks because they say the right things. If only there were more Ron Wydens and AOCs. But you see red states electing nutjobs who barely have high school degrees (Boeber) because they shout the loudest.

> half of the US is below average intelligence That is what average means. (Looks like we two are keeping it balanced!)

/woosh/

Re: Unusual Stock Trading by Whales in US Congress

#396

Post by dkarl »

nitrogen wrote: post #134
wpietri wrote: post #100

Earlier quoted context omitted.

Whatever the behind-the-scenes truth, I think the appearance of conflicting interests is a problem regardless. For a lot of elected offices and high public service positions, I think their wealth should be put into a blind trust, one constrained by law to buy broad, boring things like index funds. That would surely be a problem for some individuals. But I don't think it's a systemic problem. We only need to find 0.00…

We only need to find 0.00013% of the US population Maybe we should use sortition then instead of elections? What could be more democratic than random average people (meeting some criteria) taking a turn at the wheel?

I think random people would either be shallow and selfish about it or be so intimidated by their responsibilities that they would be at the mercy of knowledgable advisors chosen from the same small class of people who run the government now.

Re: Unusual Stock Trading by Whales in US Congress

#397

Post by mLuby »

de6u99er wrote: post #180
finexplained wrote: post #138

Earlier quoted context omitted.

In the financial industry we have restrictions not only on our own trading accounts, but on any account that we might have reasonable influence over. In my particular case, this means both my brokerage accounts and any of those belonging to a spouse. This is a requirement by our compliance departments to follow SEC regulations regarding insider trading. I don't see why similar rules would not be applied in this setti…

Sure, but ultimately it's only a crime if they get caught. And even then it seems to me that they can get away with it too easily. How about electing honest people, instead of constantly voting for the establishement (w. a few exceptions).

(If you know a way to reliably detect "honest" people, it'll make you enough money to stop caring about all this and probably win you a Nobel peace prize too.)

How to detect these crimes? By doing what the article describes: analyze the public officials' public disclosures and performance to see if "House members are outperforming market averages" or "house members followed trends far earlier" than the rest of the market. I would extend this analysis to family and known associates as well; if the politician's neighbor starts making really smart trades around the time the politician entered office, that's worth investigating.

I wonder about allowing any constituent to bring a suit against their politician if they believe they can prove insider trading. Judge/grand jury still has to rule (publicly!) that it's case-worthy before bothering the politician. If the politician loses the case, they're removed from office, must cover all legal fees, and must give the ill-gotten gains to the constituent who brought the suit as a bounty. If the suit fails, that suing constituent has to cover the legal fees.

We could also require (and might already for all I know) a written justification at time of each trade, which TV suggests is a thing hedge funds have to do, but that's basically just a fixed transaction cost since anyone with money could hire an "analyst" to write something plausible.

Another comment suggested that officials should have to announce trades in advance, though that might have the effect of banning trades altogether.

Fundamentally, I want my elected officials focused 100% on doing their job, not trying to get rich in their spare time. So barring them from all trading while in office would be fine by me.

Re: Unusual Stock Trading by Whales in US Congress

#398

Post by solipsism »

slashdev wrote: post #381
burkaman wrote: post #286

Earlier quoted context omitted.

It is not rational once you have enough money for you and those you care about to be infinitely comfortable for the rest of your lives. Say you have $100,000 in the bank, and you want to spend $10,000. What's the best use of that money? For a normal self-interested person, a rational use would be to invest in whatever will give the largest return, in order to have enough money for living expenses, retirement, childre…

You seem to have a fundamental misapprehension of capitalism. If you invest your capital, it's not being hoarded in a money bank like Scrooge McDuck. It's being put to use by the companies and institutions you invest in to provide products and services. Now I'm all for donating to charity, and it's a much better option than leaving massive wealth to your offspring, in my opinion. But investing your money is totally r…

It's being put to use by the companies and institutions you invest in to provide products and services.

Why is that better than these companies living off their profits, and their loans? You talk about it and if it's a given. It's not.

Re: Unusual Stock Trading by Whales in US Congress

#399

Post by wpietri »

michaelmrose wrote: post #145
wpietri wrote: post #107

Earlier quoted context omitted.

I'd be happy with that, but perhaps an easier solution is to make them moderately wealthy. Pay them a top 5% salary with a guaranteed pension for life, plus mandatory open finances for life. Then there's much less incentive to resort to graft.

The income for a US senator or congressman is already literally exactly at the 95th percentile at 174,000. Making someone wealthy doesn't remove their incentive to gather more wealth it gives them a stake and incentive to be more effectively corrupt.

The number I saw was $300k. But either way, I don't think that's true. Countries with endemic corruption tend to underpay people. E.g., countries where you have to bribe cops and bureaucrats are ones where those people have a hard time making a living on their normal salary.

Some people, of course, are infinitely greedy. But most people aren't. E.g., most developers I know aren't maximizing their income fully, and they definitely aren't criming to make even more money.

Re: Unusual Stock Trading by Whales in US Congress

#400

Post by MarkLowenstein »

thepete2 wrote: post #135

One thing I've always wondered: Does the stock market basically consist of insider traders making a profit off of people without that knowledge? I feel like even with immense restrictions on insiders in place, information is so easy to pass on to sb. else, that it should be impossible to prevent this. Heck, I could cough once for buy, twice for sell. Who's going to surveil me and notice that?

Somewhat, but even the non-insiders still do pretty well. My returns over the last few years are much more than I deserve, and I just have 401k/mutual funds. Maybe they would have been higher without these insiders, but probably not immensely.
Post reply on HN