According to USA Today, “SAC Capital Advisors, one of Wall Street’s largest and most profitable hedge funds, has been indicted on criminal charges for its role in insider trading offenses committed over a decade by many of its employees.” Some of the charges include:
• Sought to hire portfolio managers and analysts “with proven access to public company contacts likely to possess inside information.”
• Gave portfolio managers financial incentives to give Cohen recommendations about “high conviction” trading ideas in which they had an “edge” over other investors. But the managers weren’t “questioned when making trading recommendations that appeared to be based on inside information,” the indictment charged.
• Failed to use effective compliance procedures or practices to prevent portfolio managers and analysts from engaging in insider trading.
From a republican point of view, no one embraces rapacious capitalism! Prosecute these individuals, whenever possible. The above bullet points do represent corruption, and corruption is nascent rust to republicanism. If allowed to continue, the rust will decay the republican land. And can’t we give the people the tools to invest for themselves, anyway? Why should capitalism profit just a few capitalists? That is ridiculous.
From a liberal point of view, capitalism must be protected from fraud–and from republicans and authoritarians. The former will make everything like a non-profit. The latter will usurp all the profits. A faction able to engage corruption will ruin the potential for the median investor. Corruption does eviscerate market efficiency for the many, and does subvert liberalism because it actually moves the state (and the people) towards an authoritarian land.
From an authoritarian point of view, corruption is the key to money and power for a few–the bold leaders who understand that sometimes domination over others is natural. If you can structure insider trading into your company–your company will likely succeed. All we need to do is make sure that the people, and the government, are not able to control us or stop us from making as much profit as possible, and from taking as much power as possible.
So yeah, if the evidence is there; then, SAC Capital Advisors are authoritarians.