The Wall Street Journal’s Headline — and Mine

According to The Wall Street Journal, the Securities and Exchange wrist slapCommission just nailed hedge fund SAC Capital with the biggest-ever fine for insider trading — $616 million, to be exact.

Here’s The Journal’s headline:

“SAC Hit With Record Insider Penalty”

The Wall Street Journal; March 15, 2013

Sure sounds like a lot of dough, huh?

And nice to see justice finally being done, right?

$616 Million Wrist Slap

You’d certainly think so — at least until you understood the world of modern-day hedge funds and the ginormous amounts of capital they invest.

And not incidentally, pocket in fees.

Consider your response to SAC’s transgression(s) if instead the headline were:

“Hedge Fund Nets Billions on Insider Trading,
Gets Off With Wrist Slap”

Sadly, that’s what you call a $616 million fine in the context of multi-billions in profit.

With no jail time.

And not even an admission of guilt.

As is routine in such cases, SAC Capital “neither admitted nor denied wrongdoing.”

About the author

Ross Kaplan has 19+ years experience selling real estate all over the Twin Cities. He is also a 12-time consecutive "Super Real Estate Agent," as determined by Mpls. - St. Paul Magazine and Twin Cities Business Magazine. Prior to becoming a Realtor, Ross was an attorney (corporate law), CPA, and entrepreneur. He holds an economics degree from Stanford.

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