Laws only have to be applied fairly. In this case, congress cannot hide their purchases for months before disclosure. They are a representative of the people or their state. The people must know immediately about their backdoor dealings.
Immediate release will cause some gamification of the market. But it will also attract strong monitors on bad faith congresspeople.
Any "insider trading" law is about insider disclosure __BEFORE__ you purchase and/or sell your stock options.
The idea is: if (Insert CEO here) sells $50-million worth of stocks, we give the retail investors a chance to sell _BEFORE_ the big guy does. The CEO has to announce _far_ in advance, so that we have a chance to think "Wait, maybe this CEO is full of crap. Maybe I should sell too." (or not: maybe the CEO just wants a new party yacht. But giving people the information and opportunity to decide for themselves is what the insider trading laws are all about).
It doesn't matter if Congressmen disclose 1-day or 1-month after-the-fact. They've already benefited from the insider trade and its too late for the retail investor to benefit. Any investor who purchases after-the-fact just pumps up the stock price (making the Congressmen richer). And on the flip side: the Congressmen sells at a higher price than retailers who get "in late" to the game.
For insider trading laws to have teeth, we must push for disclosure ahead of time. But what stocks "count" as a Congressman's insider trade? Maybe any and all stocks count.
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At which point: our goal should be to push for 3-month disclosures from all Congressmen, for all publicly traded securities (stocks, commodities, etc. etc.). You see? This proposal has teeth. This has practical effect. Ex: no Congressman can ever buy, or sell, a security, without filing a disclosure at least 3 months ahead of the buy and/or sell date.
This "disclose sooner" idea does nothing. You gotta think about what you want out of a law before you start writing it.
Note: This is also a horribly "non-free" law. We force Congressmen to act by different rules than the rest of us. That's fine and good. Its an acknowledgement that they have more money, knowledge, and power than us. Its an acknowledgement that we need to level the playing field against them... even if we have to use non-free / highly selective laws that "discriminate against Congressmen".
Laws only have to be applied fairly. In this case, congress cannot hide their purchases for months before disclosure. They are a representative of the people or their state. The people must know immediately about their backdoor dealings.
Immediate release will cause some gamification of the market. But it will also attract strong monitors on bad faith congresspeople.
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