Republican Congressman insider trading reaps profits from financial collapse

[Shotsie]

Apparently Rep. Spencer Bachus (R-AL), Chairman of the House Financial Services Committee, which is the committee that oversees the entire financial services industry, used insider information gained from top Treasury and Fed officials to short the market during the 2008 financial collpase; basically betting against the US economy he took an oath to protect.

In July and August 2008, as the Financial Services Committee considered how to rescue Fannie and Freddie and avoid the collapse of the housing market (and by extension the entire financial system), Bachus was aggressively betting that that the S&P financial sector fund would fall.

On Sept. 8, 2008, GE CEO Jeff Immelt called Paulson and told him GE was having trouble selling bonds. Two days later Bachus shorted GE options four times in one day, more than doubling his money. He shorted GE 12 times between Sept. 10 and 15, and nine of the trades were profitable.
On Sept. 18, Bachus and other congressional leaders had a private meeting with Treasury Secretary Hank Paulson and Fed Chair Ben Bernanke. The meeting were so secretive, cell phones and Blackberrys weren't allowed in the room.

The very next day Bachus bought contract options on Proshares Ultra-Short QQQ, an index fund that seeks results 200% the inverse of the Nasdaq 100 index ? in other words shorting the market. On Sept. 23, he sold the options and nearly doubled his money.
At the same time, the Treasury and Bachus's committee were working on the TARP rescue plan. On Sept. 22, the day TARP was announced, Bachus made another options buy on Proshares Ultra, nearly doubling his money again.

As the TARP bill was reworked in Congress in October 2008, Bachus was involved in more private meetings. Apparently Bachus thought the bailout would work ? that month, he switched to buying shares in Powershares QQQ, betting that the market would rise.

On Oct. 14, the federal government tapped into the $700 billion bailout fund. The next day, Bachus made a quick $3,400 betting the financial sector would fall.

On Oct. 21, the Federal Reserve announced it would spent $540 billion to purchase short-term debt from money market mutual funds. The next day, Bachus bought more than $5,000 of options in Market Vectors TRN, and doubled his money.

http://articles.businessinsider.com/...eo-jeff-immelt


Any civilian that engages in insider trading is subject to Federal prosecution(i.e. Martha Stewart), yet this scumbag is claiming he did nothing wrong, and as of today there is no action being taken against him. He should probably resign immediately, and be shipped to Gitmo for engaging in treasonous acts of financial terrorism; whereby he should be held indefinitely, and subject to enhanced interrogation tactics such as waterboarding until he reveals his co-conspirators, and is prosecuted for his crimes.


If it were up to me i'd have him sentenced to death by execution without a trial, but not anything "humane" like lethal injection, no, i'd stage a public execution somewhere symbolic of his crimes; like in front of the Washington monument. As for the type of capital punshment to be used: i'd have all the major news organizations hold a poll(cbs, fox, nbc, etc.), with a choice between crucifixion, guillotine, disembowelment or impalement. Once the votes were tallied, and the method of execution chosen, it would be broadcast live on said news organization's channels across the country. Probably be more popular than the Super Bowl.

[Rochard]

No way.

Surprise!

[DaddyHalbucks]

What he did was not illegal. The law needs to be changed.

At least he didn't lie about it. Pelosi lied when confronted about her shady deals:

"And former House Speaker Nancy Pelosi and her husband have participated in at least eight IPOs. One of those came in 2008, from Visa, just as a troublesome piece of legislation that would have hurt credit card companies, began making its way through the House. Undisturbed by a potential conflict of interest the Pelosis purchased 5,000 shares of Visa at the initial price of $44 dollars. Two days later it was trading at $64. The credit card legislation never made it to the floor of the House."

http://www.cbsnews.com/8301-18560_16...in;contentBody

http://blogcritics.org/politics/arti...swamp-drainer/

http://www.thedailybeast.com/article...e-changes.html

[Vendzilla]

having the title congressman in front of his name implies he's in it for the money, doesn't matter which party

[Dvae]

Originally Posted by DaddyHalbucks

What he did was not illegal. The law needs to be changed.

At least he didn't lie about it. Pelosi lied when confronted about her shady deals:

"And former House Speaker Nancy Pelosi and her husband have participated in at least eight IPOs. One of those came in 2008, from Visa, just as a troublesome piece of legislation that would have hurt credit card companies, began making its way through the House. Undisturbed by a potential conflict of interest the Pelosis purchased 5,000 shares of Visa at the initial price of $44 dollars. Two days later it was trading at $64. The credit card legislation never made it to the floor of the House."

http://www.cbsnews.com/8301-18560_16...in;contentBody

http://blogcritics.org/politics/arti...swamp-drainer/

http://www.thedailybeast.com/article...e-changes.html

But what the OP is trying to make you believe its only wrong when Republicans do it. Truth is they all do it they should all be put in prison and being they like making laws effective retroactively lets go back a few years and anyone who participated gets some seriuos jail time. Just as though they were a stock broker or hedge fund manager.

[MakingItPay]

Am I to understand he used his insider knowledge to make close to $10,000? He should be beaten publicly for aiming so low. Maybe I'm reading it wrong.

[marlboroack]

Originally Posted by DaddyHalbucks

What he did was not illegal. The law needs to be changed.

At least he didn't lie about it. Pelosi lied when confronted about her shady deals:

"And former House Speaker Nancy Pelosi and her husband have participated in at least eight IPOs. One of those came in 2008, from Visa, just as a troublesome piece of legislation that would have hurt credit card companies, began making its way through the House. Undisturbed by a potential conflict of interest the Pelosis purchased 5,000 shares of Visa at the initial price of $44 dollars. Two days later it was trading at $64. The credit card legislation never made it to the floor of the House."

http://www.cbsnews.com/8301-18560_16...in;contentBody

http://blogcritics.org/politics/arti...swamp-drainer/

http://www.thedailybeast.com/article...e-changes.html

I agree with you

[Shotsie]

Originally Posted by DaddyHalbucks

What he did was not illegal. The law needs to be changed.

At least he didn't lie about it. Pelosi lied when confronted about her shady deals:

Trading of a corporation's stock or other securities (e.g. bonds or stock options) by individuals with access to non-public information about the company absolutely is illegal; what he did is the exact definition of insider trading, but at least he didn't lie about it after he was caught, right?

Originally Posted by Dvae

But what the OP is trying to make you believe its only wrong when Republicans do it. Truth is they all do it they should all be put in prison and being they like making laws effective retroactively lets go back a few years and anyone who participated gets some seriuos jail time. Just as though they were a stock broker or hedge fund manager.

I never in any way implied that it's only wrong when a Republican does it, not sure exactly how you came to that conclusion from reading my post. I was merely relaying the story that was reported on today, which stuck out to me as one of the more blatantly unethical acts of an elected official, and happened to focus on this guy. I didn't mention John Boehner either who cashed out of a fund designed to profit from inflation the day after he found out the banks would be getting a bailout, and who traded health-care stocks during the health-care debate. It doesn't matter what side of the aisle it's on, they should all be prosecuted.

Originally Posted by MakingItPay

Am I to understand he used his insider knowledge to make close to $10,000? He should be beaten publicly for aiming so low. Maybe I'm reading it wrong.

All in all I think he made about 75k., not a fortune, but not exactly chump change either.