I just can’t believe after all this Black Swan is still arguing that insider trading should be legal…
i agree that it could be fair for him to get a shorter sentence, so long as he is banned from finance in future. a ban from finance for life would be worse than any jailtime in my opinion. not sure if any restriction to future ability to attain licensing is part of the sentence or not… obviously a sex crime is worse than insider trading. i’d say that that crime goes underpunished. though there are a lot of ‘he says, she says’ issues in the sex crime realm so that is why the punishment is so little, so as to not ruin the life of those wrongly charged with such a crime. and stop being delusional about whether this is theft or not. how is cheating in order to attain additional money in a zero-sum game not stealing? its not like he’s making money off 30 year investments here. its short-term, its zero-sum. he wins through cheating. thus its stealing. here is a definition of the word steal: “to take, get, or win insidiously, surreptitiously, subtly, or by chance”. so if this case involves cheating in order to appropriate pennies from several investors in an insidious way aka using deceit (deceiving the counterparties that all parties hold the same information), then this particular act of cheating is theft.
MattLikesAnalysis Wrote: ------------------------------------------------------- > i agree that it could be fair for him to get a > shorter sentence, so long as he is banned from > finance in future. a ban from finance for life > would be worse than any jailtime in my opinion. > not sure if any restriction to future ability to > attain licensing is part of the sentence or > not… Agreed > obviously a sex crime is worse than insider > trading. i’d say that that crime goes > underpunished. though there are a lot of ‘he says, > she says’ issues in the sex crime realm so that is > why the punishment is so little, so as to not ruin > the life of those wrongly charged with such a > crime. Agreed > and stop being delusional about whether this is > theft or not. how is cheating in order to attain > additional money in a zero-sum game not stealing? > its not like he’s making money off 30 year > investments here. its short-term, its zero-sum. he > wins through cheating. thus its stealing. ^Fair point, you can potentially call it stealing, although if that’s the case it’s more Office Space stealing than Madoff impoverishing old ladies stealing
Do tell how it is “stealing”? Stealing means other investors possessed something…Was the other side going to trade anyways? They were going to take a loss on the position regardless of whether Raj knew inside info or not. Now you could say that he was taking advantage of them by acting on info they didn’t know…but why is he expected to act in the best interest of the people he’s trading with? I have a problem when firm executives do insider trading, because they’re actually in a position where they are supposed to act in the best interest of their shareholders. This guy has zero responsibility to anyone except his own investors. He broke the law and should therefore be punished, but I don’t understand the vindictiveness shown to him by this board.
Didn’t he indirectly steal from other managers who possibly had capital pulled out from their fund because they apparently had lower returns?
That assumes that all of his “edge” was generated by insider trading. How do you know that?
What were the sentences for the other people? Probation? Community service? The real problem is the way the FBI always gives out “plea bargains” for being a rat. They go after the person who made the most money, which is plain wrong in cases like this. The real criminals were the people on the inside giving up this information. This is like a drug bust where Raj is the drug user and the dealers/kingpin are the people giving up the inside information.
The closest similar example I can come up to to Raj’s case is Mark Macguire. Guy cheats with roids (illegal and performance enhancing). In doing so he makes tens of millions and “steals” (using my opponent’s logic) advertising and contract dollars from other players abiding by the rules. He also caused his team to win addition games and increase their fan base at the cost of other teams. He also set a world record. His getting caught undermined faith in the great American institution of professional baseball. In turn this has a corrupting influence on the nation’s athletic youth, with the youth representing perhaps our greatest resource. The result is a loss of faith among young people in our system of justice and incentives. Does Mark Macguire deserve 40 years in federal prison and the forfeiture of his ill gotten assets? Does this also mean every acheivement of his was do to the steroids? I remember when the sports world was outraged because this violation hit so close to home and everyone else said, “who cares?” while the senate held hearings on the topic. I think a similar overreaction may have happened to Raj’s offense within the SEC / FBI and finance committee. While people try to link Raj’s crime to stealing, I think it’s worthwhile to point out that a well known concept among theology and philosophy circles is that all misdeeds are forms of stealing. Stealing another’s life, stealing another’s spouse, etc. So the fact that you can link Raj’s insider trading on behalf of clients to stealing isn’t really surprising, or even necessarily evidence that he did indeed steal in the conventional sense. Particularly since the victems of his theft are all annonymous individuals who only exist in hypothetical arguments using theoretical sums of money.
Exactly. The appropriate reaction is to be banned from the game. However, I think the people who actually leaked information were the ones who should have been punished.
Palantir Wrote: ------------------------------------------------------- > That assumes that all of his “edge” was generated > by insider trading. How do you know that? Why is that assumption required? Is it not possible that his fund returns attributable to legit investment practices were roughly equal (or even less) to his peer group’s but with the insider info, he managed to outperform and hence attract capital pulled from the “underperforming” managers? Sure prosecutors have stamped the insider trading profits at roughly 60MM (which for a 7billion HF could be considered a drop in the bucket) but that could very well be only the tip of the iceberg. I doubt a person of his stature would risk his career for only 60 mil. It’s obvious that none of us “know” where the dudes edge came from but giving him the benefit of the doubt and saying he did not steal because we can’t determine if all or most of his profits were produced through illegal means just doesn’t make sense to me.
Retail investors are wary of investing in inefficient markets because they dont have any access to such insider information Mutual fund charge outrageously high fees, say 2.5% per annum, because retail investors believe that MF managers would have some access to information There is no skill involved here
as stated before: stealing is an appropriate of someone else’s assets through deceit. but as Swan said, all acts can be linked back to stealing. for our crowd, we should be looking at it more academically than the general public. we should KNOW that its blatant stealing as our knowledge of economics allows us to quantify such things as opportunity cost of not having Raj’s information. since our judicial system does operate, fine and punish based on all costs, including opportunity costs, we should be able to quickly quantify the amount he stole from others, most of which was opportunity cost. if you someone hits you with their car and you become paralyzed, you don’t just get reimbursed for the medical care until you’re better, you get reimbursed for all lost opportunity costs as a result of the accident - all lost wages, current and future (until your death if you’re unable to work forever), we even attempt to quantify pain and put a price on it and reimburse the individual for “pain and suffering”. how is the opportunity cost between not being able to work anymore and having Raj’s information any different? without such infractions (Raj’s insider trading & crazy car driving), you would be better off. saying that this is not blatent stealing shows major a lack of insight in my opinion. its time we have better discussions on AF instead of attacks on myself such as “its so not stealing. you’re an idiot if you think its stealing. i read an article in the newspaper telling me its not stealing. the guy who wrote the article was an arts major, he obviously knows the topics of law, economics and finance better than myself”. p.s. this rant is not directed towards you as you’ve become somewhat more reasonable as this thread progressed.
Steroids was not illegal in baseball before 2003.
But they were illegal in the US, which I believe supercedes the MLB rules.
insider trading is illegal so the fat fuck went to jail get over it
We should ask Chad to enable AF to let users create polls…esp for discussions like this one. Maybe a moderated one at least. Is 20 yrs too much for Raj?
The crime is grave. He disadvantaged others by unfair means.
Thank you starbuk and black label for adding nothing to this convo
reddevil_l3 Wrote: ------------------------------------------------------- > We should ask Chad to enable AF to let users > create polls…esp for discussions like this one. > Maybe a moderated one at least. > > Is 20 yrs too much for Raj? Yes
you guys are unbelievable. dont you get it - if you can make 20million dollars illegally and live like a king for 10, 15 years then you deserve to go to jail for that long. if you can live it up for 20 years and only do 5 years for insider trading then that is not enough of a punishment to deter someone. lots of people would just do the time because they can live it up and it would be worth it. federal prison isnt this hell that you see on Oz or wherever you get your ideas of jail from. federal prison is not that bad - compare it to chicago or atlanta jails - so the time isnt that bad. its not like he is sitting in a dark hole for 20 years ffs. how can you say its too long when he had 20 years to do whatever he wants because he did something illegal.