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Comment by camjohnson26 | Hacker News Reader

Particularly bad violations have been the Fed presidents making multimillion dollar trades with personal accounts, and Nancy Pelosi’s husband apparently directly trading on privileged information.

https://www.cnbc.com/2021/09/16/fed-chief-powell-orders-ethi...

https://fortune.com/2021/07/08/house-speaker-nancy-pelosi-hu...

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Your sources do not say that they traded based upon insider info.

In the case of the Fed, they only questioned whether they should be allowed to own individual stocks at all.

....and the selling of tech by NP's husband. That doesn't mean he sold because he had specific info that was secret. The article does not even make that allegation. Tech has gone up a lot - selling some is not unreasonable.

If it's reasonable to assume that someone like a Fed president is aware of the perils of market timing, of information asymmetries, of the disadvantage that an individual investor has against institutional funds, etc.--is there any plausible explanation for his trading individual stocks outside of being in possession of some kind of insider information that gives him an edge on the market?

Surely he can't just claim that he doesn't know what he's doing.

And could a Fed president be in a position to have legal insider information that gives him an edge on trading individual stocks, or is any insider info that he could trade on illegal to do so by definition?

It's widespread, republicans seem to be doing it more though

https://www.nytimes.com/2020/12/02/us/politics/david-perdue-...

https://www.cnbc.com/2021/01/19/doj-will-not-charge-sen-rich...

https://www.washingtonpost.com/politics/2021/08/11/rand-paul...

https://tulsaworld.com/news/u-s-sen-jim-inhofe-responds-afte...

I wouldn’t make it a Republican/Democrat thing since that’s guaranteed to start a flame war, Pelosi’s husband is the highest profile culprit but as you said corruption is widespread.

Pelosi's husband isn't a lawmaker himself though ... which makes me wonder, if there was a ban on lawmakers (and their spouses) actively trading, I wonder if we'd see divorces of convenience. "Oh sure, my ex-husband (and now boyfriend) trades stocks, but that's none of the public's business". Gotta think people who have an edge that can help them get rich(er) will do anything within the letter of the law to keep that edge, rather than you know, comply with the spirit of the law.

My company got acquired by a big 4 accounting firm and the rules for independence are pretty strict. Some people left after the acquisition because they were living with a partner, unmarried, who would be required to sell stocks under the independence rules.

Courts are pretty good at not letting people get away with these sorts of "loopholes." Judges tend not to interpret the law like an autistic person.

Is there a word for ignorance based on tribalism? Legitimate question; I'd like to add it to my vocabulary, and it would perfectly describe the parent comment.

Politics.

Especially American politics. It seems to be a very american phenomenon for voters to find bad things only on the "other" side and totally ignore the same thing on "their" side.

I’m not sure if your comment was meant to be ironic but it is.

They are just reported on more. This problem is party agnostic.

Not sure why Rand Paul is in your list, or how it demonstrates your point that repubs are doing it more. IIRC Paul's problem was that the disclosure filing was late, not that he, or his wife, abused his position to make that one ~$10K trade for Gilead, the maker of Remdesivir, the only stock trade during his 10-years in the Senate.

Bernie Sanders is worth $3 million and has never worked outside of politics in his entire life.

Maybe that seems like not a lot to the SV types, but it’s far, far more than what most people I know have to show for a lifetime of actually hard work.

https://finance.yahoo.com/news/rich-bernie-sanders-210000864...

He's also 80 and still working. $310/month invested over 60 years is about $3 million at 7% annual growth.

Or assume he had nothing until being elected to the senate in 2007, then started putting 60k/year into an S&P 500 index fund.

That also gets you to about $3 million.

I mostly take your point(s), and really... $3m is not a large amount for someone who's worked and been moderately diligent about finances. You don't need to have insider knowledge or bend the rules to have saved $3m over 60 years. BUT... $310/month back in 1950 was a lot of 'savable' income for most working people. Most manufacturing workers in mid 1950s were earning under $2.50/hr - even assuming some overtime, monthly earning might be $500.

Totally understand, and I was doing a bit of hand waving in the original comment. 7% is around the inflation adjusted, long term S&P 500 return, meaning $310/month would need to be adjusted for inflation over that timeframe.

Converting 2020 dollars (because times are weird right now) to 1960, it comes to about $35.50/month. On $500/month income, that's a 7% savings rate.

AHA - makes far more sense now. That pesky old 'adjusted for inflation'.

It's from selling books. What is your point?

1: That's not a real source, it just cites celebretynetworth.com. 2: Any particular reason to single him out, considering he's one of the oldest and lowest-net-worth senators? I'd say $3 million is a fairly understandable net worth for an 80 year old who's been in congress 30 years, and held public office for 40. His wife is also fairly successful.

Okay, but what does this have to do with trading stocks on inside knowledge?

As far as I’ve heard, that money is from salary and book sales.

Let’s say Bernie is saver. He could have easily a massed 3 million by his age. This if he had started at younger age let’s say 20. Compounding interest is a pretty powerful force over years . Bernie is not quite a young guy and has been working his entire life.

3 million isn’t exactly a lot of you live within your means and save.

Senators get paid pretty well, have great benefits, and lots of reimbursed expenses. Sanders is also older than dirt and still hasn't retired despite his age. I can't believe he's only worth $3 million.

Of all the senators to look at you pick sanders? Senators are paid $174k a year and Sanders wears hand knit mittens. This story goes into his wealth.

https://www.politico.com/magazine/story/2019/05/24/bernie-sa...

>Bernie Sanders one day left City Hall and found a ticket on the windshield of his rusty Volkswagen Dasher. The offense: This was the mayor’s spot, and, surely, a cop had thought, this was not the mayor’s car. But it was. It matched perfectly with both Sanders’ image as a scrappy advocate of the little guy and his own shaky financial reality. It was the beginning of the 1980s, and he was approaching 40, a single father of a not-quite-teenage son, renting a sparse second-floor apartment and having a hard time keeping up with his bills. “Not only,” he wrote on his yellow, coffee-splotched legal pads kept in archives at the University of Vermont, “do I not pay bills every month—‘What, every month?’—I am unable to …” His scribbles in barely legible cursive in the margins read like reminders and afterthoughts: “gas,” “light,” “water.”

He was, said Bruce Seifer, a friend of Sanders, an economic aide in his administration and one of many people who know him who told me this, “frugal.” Seifer paused and considered the right way to put it. “That’s a nice way of saying he’s a cheap son of a bitch.”

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