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The S.T.O.C.K Act

The S.T.O.C.K Act aka Stop Trading On Congressional Knowledge Act aka H.R. 1148 In response to the extreme turmoil in the financial markets in late 2008, Congress and other U.S. government bodies unleashed a flurry of emergency legislation, bailouts, and other aid in an attempt to stem the crisis. With Congress members privy to significant nonpublic information that would impact finance-company shares, voters would be understandably concerned if lawmakers ramped up their trading activity during this period. And that's exactly what happened. The Financial-Trading Flurry Both the total value of financial shares traded, as well as the total number of financial-stock transactions between Sept. 1, 2008 and Oct. 3, 2008 showed a marked increase from the same periods in previous years. Total Transaction Value* Financial Stock Transactions $6.7M $7M 350 318 S6M 300 $5M - 250 - $4.4M $4M 200 - $3M 150 135 137 115 $1.9M. $1.7M $2M - 100 $1M - 50 2005 2006 2007 2008 2005 2006 2007 2008 "Except where actual transaction values were entered, transaction values were totaled based on the midpoint of transaction-value ranges. 2005 total excludes a $25 milon to $50 million trade in Goldman Sachs stock that was Conducted in a blind trust. Trading in Both Houses Trading was hot and heavy in Congress and the action extended to both the Senate and the House. Senate Total amount traded: $2.5M Total number of trades: 56 House of Representatives Total amount traded: $4.1M Total number of trades: 262 The Gang's All Here All of the major financial companies were well represented in Congress members' trading during this time period. Company Total amount traded Total trades citıgroup $215,003 6 Bank of America $157,095 10 OJPMorgan $212,006 12 $121,503 6 WACHOVIA AIG $290,602 15 $692,267 36 Goldman Sachs $124,767 14 Morgan Stanley $40,501 2 WELLS FARGO $462,006 12 Freddie AMac $56,502 4 A FannieMae Center for Responsive Politics Source: Center for Responsive Politics Stay Connected with the Fool on E @TheMotleyFool and on f themotleyfool © 1995 - 2012 The Motley Foel. All rights reserved.

The S.T.O.C.K Act

shared by themotleyfool on Feb 01
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Understand what the STOCK Act is and how members of Congress can trade on nonpublic information.


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