And in other news not related to Facebook’s astonishing $5 billion IPO, something even more shocking…
Lawmakers in Congress are actually trying to level the playing field.
Back in November 2011, a segment on the CBS show “60 Minutes” highlighted how members of Congress have a grossly unfair advantage when investing in the stock market.
As you can imagine, their privileged positions give them access to all kinds of highly exclusive, top-secret information that affects a multitude of industries and stocks.
Information that’s also highly profitable.
And the damning, blood-boiling “60 Minutes” story exposed just how unscrupulous some members of Congress really are. They’re sitting in sub-committees on defense contracts, the healthcare bill, the financial sector, then turning around and investing directly on that information.
Yet they’re not breaking any insider trading laws.
My colleague, Robert Williams, covered the story when it broke, and in the outcry that followed – and continues today – some of Washington’s more honest politicians have tried to push through stricter, more ethical laws to prevent members of Congress, their families and staff from unfairly trading – and profiting – on privileged information that’s not available to the general public.
Like Senator Sherrod Brown of Ohio, for example, who MarketWatch quotes:
“Members of Congress not only have the privilege of serving, but they’re compensated well for it. There’s no reason they need to be in the business of buying or selling stocks that could be influenced by their actions.”
Amen. So how are they getting on?
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On Thursday, Senate Majority Leader, Harry Reid, revealed that he and fellow lawmakers are trying to push an anti-insider-trading bill through Congress after it cleared the first hurdle by a whopping 93-2 vote on Monday. (It only needed 60 votes to pass.)
The sticking point? Over the past couple of days, some proposed amendments have caused controversy and could delay the vote.
For example, Senator Brown’s amendment would forbid members of Congress and their staff from personally trading stocks, or if they do have stock holdings, to put them into separate accounts that they don’t control.
Another one from Senator Rand Paul of Kentucky would ban Congressman from becoming lobbyists once they retire from Congress… or face losing their federal pensions. This Washington-Wall Street lobbyist game has become an increasingly pervasive – and dangerous – trend in recent years. And if you don’t believe me, just take a look at the ugly statistics…
The amendments are in addition to the main bill, part of which requires lawmakers and their staff to declare any purchases or sales of stock and commodities within one month.
However, while the Senate is making good progress on the bill, the same can’t be said for the House of Representatives. Having delayed similar legislation in December, they’re now under pressure to get moving. According to MarketWatch, a representative of House Majority Leader, Eric Cantor, says Republicans will take action on an expanded version of the Senate bill this month.
I’m not holding my breath!