Well, it seems that the good g-men at the SEC, the folks who pursue insider trading, might be moving on insider information themselves. I am shocked! Shocked!
Who would have thought that the secular angels at the Securities and Exchange Commission might be tempted to benefit from their positions of privilege? I have to say this news has hit me hard. I had to sit down.
It gives more credence to those who argue that insider trading should just be legalized that’s for sure.
The result, they wrote, were abnormal returns of about 4 percent for the market in general, and about 8.5 percent for the U.S. stock market. That’s significant. While an SEC employees’ stock purchases are normal, their stock “sales appear to systematically dodge the revelation of bad news in the future,” according to the paper’s findings…
…Rajgopal and White specifically found a high volume of SEC employee sales from 2010 to 2011 before enforcement action in Bank of America, General Electric, Citigroup, Johnson and Johnson, and JP Morgan.
Read more at: Against Crony Capitalism.org