In case you missed it, this week the Dow Jones Industrial Average broke 15,000 for the first time. Soon it may actually close above 15,000. The stock market is doing great and if you have stock investments or a 401-K you are probably making money.
But there is a group of folks that I would lay odds that are doing better than you and me when it comes to investing. These folks have the knowledge to invest in stocks just before they start to move, and it makes this group a lot of money. This ever so wise group I'm referring to is your United States Congress.
Many members and staff in Congress have taken advantage of their positions in government to reap financial windfalls. Media reports from 2011 pointed to members of congressional committees that received inside information on everything from medical issues, industrial trends, and various leading indicators from other sectors of the economy. This insider information gave them a head start on the rest of us. Many used that information and bought or sold stocks, increasing their personal worth by millions of dollars.
Through media pressure, the STOCK Act or "Stop Trading On Congressional Knowledge Act" was passed. That act prohibited members of these committees from making stock transactions based on information related to the committees on which they served. It looked like the mess was cleaned up. But...wouldn't you know...the same congress that couldn't work together to settle the recent budget crisis was actually able to find middle ground and pass a bill which revised the STOCK Act and virtually gutted it. The revisions essentially made it OK for congressmen to make these questionable stock trades again.
Many of us in the media are on this again but it is doubtful that Congress will make any attempt to actually fix the issue. Stay tuned.
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