
What's Wrong About Insider Trading?  - agbell
http://www.cato.org/pub_display.php?pub_id=11816
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pwhelan
"Professional investors make money because of asymmetries of information.
Someone working on Wall Street is almost always going to be better versed on
financial issues than a casual investor. People make careers picking up hints
and suggestions to use in trading."

Yes, professionals should be better at it than amateurs. However, those
professionals are still using public information. Just because they are better
at it doesn't mean that it these asymmetries are unfair. Regardless of what
the article says -- there is a victim in the form of the other shareholders.
The impact of the crime may be dispersed over many people, but that doesn't
mean it isn't still just plain wrong to do. All of the owners should have the
opportunity to begin selling (or buying) at the same time if they choose to
stay on top of the information and to argue otherwise feels foolish. Just
because they cannot get insider "not trading" doesn't mean they shouldn't nab
insider trading.

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bediger
Didn't the author totally miss out on the most important consequence of a
"level playing field"? That is, anyone can feel like they can safely invest. A
level playing field opens the stock market to people in rural areas, rather
than limiting it to well-connected upper-crust insiders. A lot more money can
end up capitalizing innovators and entrepreneurs.

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agbell
Interesting quote:

"People make money by not trading as well as trading. But it is virtually
impossible to prove that someone chose not to buy or sell stock because of a
legally improper tip. So hundreds, maybe thousands, of people get away with
insider "not trading" every year."

