Comment by eru
19 hours ago
> The Shanghai stock exchange is still too heavy on insider trading, [...]
What does that mean?
Insider trading is good for the function of the market: it makes sure information is reflected in prices sooner, benefiting the general public.
> Like, you could wager some money on a mahjong game, or you could blindly pick a stock and hope you can get some money by riding in the wake of a connected insider trader.
If you are a clueless retail investor, buy a low cost index fund. Why would you be picking stocks?
That's a spicy meatball. And also very stupid, but I admire the lack of foresight it takes to advocate for insider trading. What's your next hot take? Can i suggest 'Epstein did nothing wrong'?
the OP isn't wrong about insider trading - it's just that it lacked the crucial bit about being _transparent_ about insider trading.
Current insider trading laws are about _preventing_ it (but it still happens). This makes it so that insiders who do trade and get away with it make bank, but this does little to benefit the over all market information equilibrium.
What needs to make insider trading "good" (instead of bad), is to make the insider's trades 100% transparent and instant (instead of the months of SEC filing currently needed before it becomes public info). Doing this will ensure that insider's trades immediately gets reflected and copied/arbitraged against, and will allow the price of a stock to reflect information not yet released but is acted upon by insiders.
See also https://en.wikipedia.org/wiki/Insider_trading#Arguments_for_...
Insider trading is already perfectly legal (by US law), if you do it with consent of your company. So the rules are not about protecting the public at all.
In any case, I'm not making some innovative new argument or hot take. This is pretty standard, orthodox academic stuff. See eg https://en.wikipedia.org/wiki/Insider_trading#Arguments_for_...
What's an Epstein? Is that some other company you don't like?
That isn’t true at all. You need to take your insider trading again (every bigcorp makes you do it) and learn what insider trading actually is, and why it is illegal, and why you’ll probably get caught. I’ve heard too many sad stories where immigrants from a country with looser laws came to the USA for very high paying tech jobs, and throw them away for just $100k of insider trading gains.
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Epstein is good for the economy because it ensures politicians get goods before they would be considered market ready allowing for policy to be created proactively. /s