Insider Trading and the Art Bubble

By James Kwak

I recently wrote two more articles for the Bull Market collection at Medium. The first was my explanation of the Second Circuit’s decision in United States v. Newman and Chiasson, which said that insider trading is only a crime if the original tipper gained a personal benefit from leaking confidential information, and if the eventual trader knew of that personal benefit. If you don’t like this outcome, the original problem is a poorly written Supreme Court opinion (isn’t that redundant?) from the 1980s, Dirks v. SEC.

The second article was a response to a column by James Stewart and a post by Felix Salmon about soaring prices in the art market—which, almost by definition, constitute a bubble.

15 responses to “Insider Trading and the Art Bubble

  1. Reblogged this on rullyhabib and commented:
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  2. Absolutely Awesome! Your blog is great. Keep up the great work! please Visit http://www.helloworldmagazine.com sometime, too. Thanks!

  3. I am not so sure about the logic in your article:

    If the “0.01% continue to take home a larger share of societal income” and put their money in a bubble is not some in the .01% at least being set up for some equalization?

    If suddenly all Warhol’s end up being just worth their frames… do we or don’t we have a better and more equal world?

    The sad part though is that this art bubble is much the result of liquidity injections like QEs which are not allowed to go to banks for further relending to small businesses and entrepreneurs, because these borrowers have by regulators been decreed as too risky for banks; an opinion they express by means of their credit-risk-weighted capital requirements for banks.

  4. Per we’ve been over this, we live in a fiat money based world. Those who control the money want to control the world (with their high interest rates). Should a return to the gold standard occur, yes all bonds, equities, art, FRN’s, could at some time be only worth the frames or paper they are written on, and so yes, many more people would be living in a better and more equal world. We love the old addage, have you ever gotten a job from a poor person, having the obvious answer. We say no, but you could lose one from a poor man, but that’s a whole nother story, aint it?

  5. I guess I’m a little TOO off topic on this blog sometimes. So I do apologize to the hosts Kwak and Johnson. It’s kind of rude and off protocol, so I am kinda sorry for that. It’s just I feel such a strong connection to this blog I like to imagine the other regular readers have some of the same interests I do. In that vain, here is hoping some of the other regs of “Baseline” are awaiting “Bad Santa” as much as I am:

    http://www.hollywoodreporter.com/video/billy-bob-thorton-reveals-bad-742130

  6. check that, “Bad Santa II”

  7. http://rt.com/usa/217895-nsa-inspector-general-reports/

    They ROBBED people to PAY themselves.

    PROVE that is not the case with these scum bag (“….she’s anti-this and anti-that!….) NSA enronistas!

    As for the art bubble, nihilists buying it up will blow up the art once they can transform their fiat $$$$ invested in it back into a war machine.

  8. Howdie, I am a stupid OKlahoma C_unt who wants to be Oklahoma Governor one day:
    http://www.nytimes.com/2014/12/07/us/politics/energy-firms-in-secretive-alliance-with-attorneys-general.html?_r=0

  9. Hello, One day I asked Oklahoma Governor Mary Fallin to put a gas dildo CLEAR up my rear. CheapWh*re Fallin gave me THIS answer:
    http://www.nytimes.com/2014/12/07/us/politics/energy-firms-in-secretive-alliance-with-attorneys-general.html?_r=0

  10. Hello, I feel sad now, the Oil & Gas Dildo Oklahoma Governor Mary Fallin put up my rear wasn’t quite hard enough….will you suck on my C*NT with more effort please??? Signed—-SCOTT PRUITT
    http://www.nytimes.com/2014/12/07/us/politics/energy-firms-in-secretive-alliance-with-attorneys-general.html?_r=0

  11. Hello, My name is Mary Fallin, the Oklahoma Governor, would you allow me to be a new porn star in the Oklahoma oil & gas industry please.??? Scott Pruitt can be my “fluffer”!!!!
    http://www.nytimes.com/2014/12/07/us/politics/energy-firms-in-secretive-alliance-with-attorneys-general.html?_r=0

  12. The 5 comments just above in this post are meant as political satire,

    Signed, A citizen, tired of CORRUPT politicians

  13. @Moses – get help for your misogyny….which you use, btw, in the most crude and lewd red herring way possible to distract from the WORST “corruption” in USA government being the AIPACs and how the NSA, CIA and IRS are chock full of

    “an atheist and Mormon walk into the CIA”…..

    getting 81 million FIAT $$$$s for the “job” they created with technology – torture…

    so f u, “Moses” – there is a non-yid female governor of Oklahoma – GET OVER IT