Mon, 2 Jul 12 at 14:03 | No Comments Yet
And where the hell is the SEC?
When the Supreme Court released its decision in the “Obamacare” case on Thursday, there was one notable winner on Wall Street. HCA Holdings, a major hospital group, saw its stock soar 11 percent.
Gee, it would have been nice to know that ahead of time! Anyone with some investing cash could have made a bundle.
Of course, the Supreme Court is famously secretive. Unlike, say, Congress, where inside information is not just sold to hedge fund managers but traded on by the members themselves, the Supremes hold themselves to a higher standard. As Bloomberg noted, “The secrecy ensured that [the ACA] announcement was a rare moment of genuine Washington drama, an instant in which the justices finally told us the news we’ve all been waiting to hear.”
Except … somebody did leak. And a few Wall Street traders made out like bandits.
The chart shows HCA’s stock price from Wednesday afternoon through Thursday morning. HCA closed at $26.61. Next morning, everyone knew the decision was coming at 10:00 a.m., one hour after the market opened. And during that hour, the price jumped about one dollar — on significantly heavy volume. Then, when the announcement was released, a spike all the way up to $29.40, as the rest of the world piled in.
See what happened? A handful of very, very lucky traders got in at $27.50 — and immediately saw their holdings leap in value.
But they got in before the decision was announced. About one hour before.
Somebody inside talked. Somebody outside made a killing.
This is why the little guy hates Wall Street, plain and simple. Even the Supreme Fucking Court has been compromised, its hallowed status as the safeguard of our nation’s laws sold out to some rich sharpies.
Nor is this an isolated incident. Transparency International, for example, ranks the United States a pathetic 24th on its “Corruption Index,” behind such exemplars of good governance as Qatar and the Bahamas.
This is a disgrace.