"Hedge funds scurry to sever ties with Cohen's SAC Capital"

Discussion in 'Wall St. News' started by wilburbear, Dec 24, 2009.

  1. Gcapman


    These hedge fund chumps are nothing

    I will show you all what true trading should look like
  2. Long as you do it clean. Go for it. But no arm busting, calling suppliers saying the vendor is no good, putting lackies in the target companies as employees, bribing reporters, congressmen, regulators.

    Oh, I can't wait for the first week in January. I really can't.
  3. Tide31


    Weak. The far-reaching deepcapture site claims insider trading, then backs it up with some 6-7 year old e-mails. That the regulators already passed on! I think Reg FD is primarily like a 24 hour window thing with respect to analysts. Not exactly sure of the wording in Reg FD. Comparing notes with an analyst who's yet to publish a single report at a new firm a month+ before he publishes something, is not going to send anybody to the big house. I would sue the guy for slander with regards to the FBI thing.
  4. That makes it OK? They're old? And the regulators passed on it? Interesting.

    By the way, the FFH case is ongoing in Canada, and the same thugs are defendants there, too.
  5. I wrote that piece, by the way. I'm glad you at least read it before responding. You'd be surprised how many message board people don't do at least that much.
    As I recall, they passed on Bernie Madoff, too (four or five times).
    And when Gary Aguirre wanted to depose John Mack, they passed on that one, as well. And then they fired Aguirre. And then actively defamed him.
    That the SEC routinely "passes" when confronted with evidence of misdeeds by the big guys is pretty much axiomatic.

    First, I never said they're going to the big house for this episode. I'm simply demonstrating a certain modus operandi. I believe insider trading is one way short sellers grow 25% per anum in the midst of the greatest bull market of all time.
    Second, there may be nothing wrong with an analyst "comparing notes" with anybody. What is wrong is influencing the report and then trading ahead of its publication. If we can't agree on that, I doubt we'll agree on much else.

    I would love to be sued by one of those hedge funds for defamation (which is what it's called when written). I can't tell you how much I would welcome that.
  6. Any step to force more honesty into the US markets is a step in the right direction as long as the investment banks are included along with the hedge funds.

    The prophet.
  7. patchie


    Tide, I guess you haven't been paying attention to insider trading cases. Some are new and some are quite old. Galleon insider trading claims date awhile back as does the allegations against Pequot that drove the fund to closure.
  8. Nonsense

    Bernie Madoff is a criminal but hedge funds talking about "business" is as legal as me telling you that I think there maybe an analyst out there that doesn't like Microsoft this quarter.

    Another analogy would be the equivalent of calling a lawyer a criminal because he defends a guilty client.

    When did America turn into such a socialist country?

    Peoples attitudes these days are really very disturbing!
  9. I am not sure I agree with you, it depends what you mean by influencing the report. I think the analyst probing investors in the market for information is good, and it is definitely legal. Investors sharing factual information that was not improperly obtained is good - it gets the facts out to a wider audience sooner. I would agree with you if your concern is that the hedge funds are supplying misinformation, but I don't see that claim in your story.

    I do agree that the analyst shouldn't disclose the contents of the report prematurely to favored parties, its good that they fired the guy and I wouldn't be sad to see additional penalties for the firm.

    I also think the hedge fund should be able to trade on the information they supplied to the analyst. If their analysis would have led them to slowly building up a short position, why can't they accelerate their trades if they think it will be made public? If you stop them from doing this you just slow the release of the information. If their accelerated trades are motivated by the analyst saying I agree and will tell the world instead of the original analysis, that is a different story. But it seems like it would be hard to prove unless they incriminate themselves.

    Another interesting related question is who gets hurt by the shortselling fund, and I don't see an obvious answer as long as the trade is motivated by real negative info. Whoever buys from the hedge fund that is shorting definitely made a bad trade, but if the hedge fund wasn't shorting they likely would have bought anyway. Maybe at a higher price if they were not buying from a motivated short seller. And when the short is covered it seems like is should reduce overreaction on the downside.

    But thanks for the story, it is nicely done and important stuff to get out in public even if I don't agree with some of the more extreme conclusions.

    So may you have a lawsuit and all the publicity and file boxes of dirt that come with it in 2010!
    #10     Dec 26, 2009