Thursday, July 31, 2014

Outside Looking In

Your money at work. For them.
It's all about getting information...they call it trading stocks, but it's really trading information. That's what we were doing.

--Turney Duff, former Galleon trader

Just peeped Scorsese's The Wolf of Wall Street, and I'd bet the average person would say it's about the craziest story ever. I'd get that. But Jordan Belfort's slimey infomercial rat-a-tat buggery is chump change compared to the middle-class soul sucking black hole that's the state of finance now.

Yesterday, Frontline aired To Catch a Trader, whose bullseye was puss sack Stevie Cohen (SAC Capital). Given that I've devoted a good amount of time to looking at finance now, not much these days surprises me. One thing did; "expert networks," camouflage for leakers on the inside who personally profit by leaking info (in advance, of course) to traders.

Turney Duff related how he picked up a call intended for Rajaratnam with a tip on Amazon. Raj wasn't around, so Duff took the call and the info. It being his first experience with insider rigging, he hung up and wondered what he should do.

He ended up placing a bet and "making" 500 g's in 30 minutes.

But it's what Duff says after this that's key, and I paraphrase: "I thought, 'Gee, if I could get a call like this every day, I could be a great trader too.' So I determined that I needed my own 'whisper guy' too."

Poker players don't cheat. In fact, gamblers are, at least when it comes to gambling, some of the most ethical and honest people I've ever encountered. But in this EM08 world where up is down, gangster dons like JPMC, Goldman and HSBC get away with historic looting, while nothing is done to police them -- even in the wake of their historic crimes! Meanwhile, walk into a Vegas casino and you'll have a camera up your ass and are surveilled at every turn.