Currently the FBI is enforcing (attempting to enforce) free market conditions with its massive probe of insider trading: [image] FBI launches insider trading probe into major US hedge funds According to the Wall Street Journal, investigators are looking into multiple insider-trading rin…

Sorry to jump in, but I’ll give this my take. Why would there need to be an incentive for him to share information with the public? The actions (such as buying shares, selling shares, exercising options) of an insider say plenty on his opinion of the company.

stock prices supposedly reflect the discounted value of payments associated with the asset. to that extent, they serve as a type of signal for the prospects of the company. if stock prices are rising, that is telling you that investors believe that business will be good for the company over the for…

Referring again to Milton Friedman… buying/selling stock is how he shares it with the public.

It can be debated whether insider trading should even be a crime. It is neither a form of fraud nor theft, I fail to see anything immoral about it. What in your opinion is wrong with it ?

Agree with previous comment. It’s like a problem created out of thin air.

So, essentially, a CEO could buy 1m shares of a company at $40/ea. Investors see this as a good signal, and start buying the stock in droves, pushing the price up to $42.50/ea. The CEO then sells the 1m shares that he just bought, taking advantage of the lemmings that thought his purchase of the st…

Oh no! They knowingly and willingly risk their money and come out as losers? The horror! The unspeakable horror!

If shareholders know that they can get ripped off in this manner, why would they invest in the company in the first place? I don’t understand the thought process here.

Free market solution to insider trading?

Economics Economics Questions

DD5 November 25, 2010, 8:44am 11

There was a thread on this here:

https://forum.freecapitalists.org/t/insider-trading/12133

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Free market solution to insider trading?

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