Cause I'll tell you that there's so much more money to be made in legal ways that the benefits of insider trading, coupled with the fact that the SEC loves to make examples of people, that insider trading is very rare nowadays. Everything is logged electronically.
(I'm sorry, but this is the sort of "the rich and powerful get away with murder" crap that makes me want to smack a bitch.)
Sachin, you live in Chicago - venture over to the CBOT or talk to some of your friends that work there. While the OP's post is certainly an exaggeration, the rich & connected have access to privy information.
This:
http://www.marginalrevolution.com/marginalrevolution/2004/02...
Is not a coincidence.
That said, there are a lot of people who will trade on rumors that they consider "inside information" that things don't work out as well as you'd think they would. Look at the volatility in stocks right before earnings announcements. It's hysterical.
You can long or short volatility :).
there are millions of trades every day, by individuals, funds, even computers trading on behalf of people. its simply impossible for the SEC to know what each party understands or should understand before they transact. the antidote to this is near-full transparency in financial reporting...instead of trying to keep track of who knows what secrets, the SEC errs on the side of no one having secrets for long (disclosure)
of course! go look at any pivotal event in a stock to the upside or downside...look at the huge trading blocks that take place just before the huge swings (in either direction) just prior...do you think those people are just speculating? do you think you compete with elite trading firms on a level playing field???
Did people who knew about secret, CIA-led coups use that information to game the stock market? Sure looks like it.