Call your congressman, not your stock broker, for hot tips

Mark J. Fitzgibbons
What's illegal for you and me is legal for them. Valerie Richardson in the Washington Times:

It's no secret that members of Congress qualify as political insiders, but a new report strongly suggests that they also may be insiders when it comes to trading stocks.

An extensive study released Wednesday in the journal Business and Politics found that the investments of members of the House of Representativesoutperformed those of the average investor by 55 basis points per month, or 6 percent annually, suggesting that lawmakers are taking advantage of inside information to fatten their stock portfolios.

"We find strong evidence that members of the House have some type of non-public information which they use for personal gain," according to four academics who authored the study, "Abnormal Returns From the Common Stock Investments of Members of the U.S. House of Representatives."

At Instapundit:

THOSE REVELATIONS ABOUT CONGRESSIONAL INSIDER TRADING lead Jeff Carter to observe: "I now understand why campaigns have become so expensive. The net present value of beating the market by 6% annually, along with the net present value of a guaranteed government pension, cushy health benefits, and the opportunity to leverage your elected position into a lucrative full time lobbying job after 'serving' your country makes the spending seem minimal." Even better, the campaign cash comes out of other people's pockets. Win-win!


What's illegal for you and me is legal for them. Valerie Richardson in the Washington Times:

It's no secret that members of Congress qualify as political insiders, but a new report strongly suggests that they also may be insiders when it comes to trading stocks.

An extensive study released Wednesday in the journal Business and Politics found that the investments of members of the House of Representativesoutperformed those of the average investor by 55 basis points per month, or 6 percent annually, suggesting that lawmakers are taking advantage of inside information to fatten their stock portfolios.

"We find strong evidence that members of the House have some type of non-public information which they use for personal gain," according to four academics who authored the study, "Abnormal Returns From the Common Stock Investments of Members of the U.S. House of Representatives."

At Instapundit:

THOSE REVELATIONS ABOUT CONGRESSIONAL INSIDER TRADING lead Jeff Carter to observe: "I now understand why campaigns have become so expensive. The net present value of beating the market by 6% annually, along with the net present value of a guaranteed government pension, cushy health benefits, and the opportunity to leverage your elected position into a lucrative full time lobbying job after 'serving' your country makes the spending seem minimal." Even better, the campaign cash comes out of other people's pockets. Win-win!