Wednesday, May 25, 2011


"Insider trading" is hard to define and successful prosecutions are rare.  The recent conviction of Raj Rajaratnam is an exception.

Alan Ziobrowski and his colleagues have recently published "Abnormal Returns From the Common Stock Investments of Members of the U.S. House of Representatives" in the Berkeley Electronic Press.  Here is a link to the abstract.  I have no idea whether investigations are underway and if there will be accusations, prosecutions and convictions.  I'm not even sure these would be feasible.  But exposure as in the cited paper is nice.

Hillary Clinton made some astute cattle futures trades in her First Lady days and quickly made a lot of money.  She explained it all with "I read the Wall Street Journal," and that was that.  Some of us are inevitably better placed than others to make lucrative market bets.  That's life.  It goes back to the quaint old idea that the only antidote is a smaller role for politics and politicians.

H/T Brad Hill