Ex-Treasury Sec Paulson Tipped Hedge-Fund Buddies About Plans for Fannie & Freddie

Well, I guess this fits in the General Conspiracies forum.

How the foul deed was done: According to Bloomberg, Paulson, in a meeting with Eton Park Capital Management LP, in 2008

...went on to describe a possible scenario for placing Fannie and Freddie into “conservatorship” -- a government seizure designed to allow the firms to continue operations despite heavy losses in the mortgage markets.

But here's the interesting part:

The fund manager says he was shocked that Paulson would furnish such specific information -- to his mind, leaving little doubt that the Treasury Department would carry out the plan. The managers attending the meeting were thus given a choice opportunity to trade on that information. There’s no evidence that they did so after the meeting; [but] tracking firm-specific short stock sales isn’t possible using public documents.

Ah. But, see, there's no evidence that they used the information in an illegal way. No evidence because tracking firm-specific short stock sales isn't possible. Well... I guess I have to believe they did the upright, moral thing, then....

What do you think?

Source: Bloomberg

If you could prove that they did use the information, can you cite the law that would have been violated? I do not think you can.

TREASON -- Oran's Dictionary of the Law (1983) defines treason as "...[a]...citizen's actions to help a foreign government overthrow, make war against, or seriously injure the [parent nation]." In many nations, it is also often considered treason to attempt or conspire to overthrow the government, even if no foreign country is aided or involved by such an endeavour.

Outside legal spheres, the word "traitor" may also be used to describe a person who betrays (or is accused of betraying) their own political party, nation, family, friends, ethnic group, team, religion, social class, or other group to which they may belong.

COLLUSION -- Collusion is an agreement between two or more persons, sometimes illegal and therefore secretive, to limit open competition by deceiving, misleading, or defrauding others of their legal rights, or to obtain an objective forbidden by law typically by defrauding or gaining an unfair advantage.[citation needed] It is an agreement among firms to divide the market, set prices, or limit production.[1] It can involve "wage fixing, kickbacks, or misrepresenting the independence of the relationship between the colluding parties"

Pick one....

I agree with you in principle. However, no law exists to preclude what they did. It is unethical, but not illegal. And if that was not the way most Americans behave culture wide it would not be going on at the top. Our leaders are products of our culture and we deserve the leaders we have. Now go work on that beam in your eye.

Originally posted by Zaanny
TREASON -- Oran's Dictionary of the Law (1983) defines treason as "...[a]...citizen's actions to help a foreign government overthrow, make war against, or seriously injure the [parent nation]." In many nations, it is also often considered treason to attempt or conspire to overthrow the government, even if no foreign country is aided or involved by such an endeavour.

Outside legal spheres, the word "traitor" may also be used to describe a person who betrays (or is accused of betraying) their own political party, nation, family, friends, ethnic group, team, religion, social class, or other group to which they may belong.

COLLUSION -- Collusion is an agreement between two or more persons, sometimes illegal and therefore secretive, to limit open competition by deceiving, misleading, or defrauding others of their legal rights, or to obtain an objective forbidden by law typically by defrauding or gaining an unfair advantage.[citation needed] It is an agreement among firms to divide the market, set prices, or limit production.[1] It can involve "wage fixing, kickbacks, or misrepresenting the independence of the relationship between the colluding parties"

Pick one....

reply to post by jcord

Well, first: Thanks, Zaany [above]. Couldn't have said it better.

And secondly, I can only quote the article again:

The fund manager who described the meeting left after coffee and called his lawyer. The attorney's quick conclusion: Paulson's talk was material nonpublic information, and his client should immediately stop trading the shares of Washington- based Fannie and McLean, Virginia-based Freddie.

Perhaps I should have said "unethical" and not "illegal." OK?

reply to post by Ex_CT2

Barack Obama campaigned through New Jersey to help now ex-Gov. Corzine in his bid for re-election in 2009. Not once, not twice, but three times Obama took time out of his very busy presidential schedule to trek over to the Garden State, supporting this www.frugal-cafe.com... -which-is-mia-video/

Robber....

Ben on MF Global....

Ummmm..,,,,,Ummmm.......Uhhhh........



Baracks best BFF in the finance industry...

Biden with Corzine by his side, called for advice on what to do about the economy.

reply to post by jcord


Insider trading

This was privileged non-public information, so, yes it would be illegal and punishable by law.

Of course, that would imply that this is not the standard operating practice on Wall Street, where they pay those in Washington hush money... uh, make campaign contributions to ensure that they can continue with this type of illicit business model indefinitely.

the Billmeister