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View Diary: The Stock Market IS Rigged: Big Investors Illegally Get Analysts' Info Before You Do (94 comments)

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  •  Rigged but regulators just shrug (5+ / 0-)

    I had a friend that was a technical representative for a large investment bank in the early 00s (based on Wall Street).  She had a PhD in biomedical science and her bosses frequently tried to get her to call researchers (at universities AND pharma companies) to pose as a grad student or postdoc to get non-public information about new data.  Many scientists don't understand the implications of such casual conversations and would spill the beans without realizing it.  The bank bosses were trawling for any little piece of data that would give them a boost in trading.  If preliminary data was looking bad for a hopeful compound...that was powerful news to investors.  Early Phase II failures were big news and could swing stocks a few percentage points back then.  She thought it was unethical and eventually left the business.  My basic point is, the big banks (and hedge funds) are doing anything they can to get inside information for competitive advantage.  It is almost seen as necessary by traders and somehow tolerated by the regulators. The little guys and Main Street investors don't stand a chance.

    "It looks like how music sounds." --My four year old nephew upon looking through a kaleidoscope for the first time

    by Mote Dai on Mon Jul 16, 2012 at 10:11:10 AM PDT

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