Thursday, June 14, 2012 – by Staff Report, Daily Bell
Judge Jed Rakoff
The very model of a modern major judge ... When the judge in the Rajat Gupta case has the gavel, the law itself is on trial ... The financial crisis has placed the muddled state of corporate law in America under intense scrutiny. Jed Rakoff, the judge in the current insider-trading case against Rajat Gupta, a former managing director of McKinsey, has emerged as an important player in this process. The 68-year-old judge is technically on "senior status" in the federal district court, meaning he can elect to work reduced hours. But there is nothing half-hearted about Mr Rakoff's approach. He is a powerful presence in a courtroom, and even more so in a string of recent opinions that underscore the contradictions in American regulation. – Economist Magazine
Dominant Social Theme: Insider trading is confusing, but certainly worth clarifying. And always worth prosecuting.
Free-Market Analysis: This is another one of those Economist articles that reads better if you don't read it more than once. It points up once more the issues we've discussed regarding insider trading, its hopelessness as a legal doctrine and the general unfairness of prosecuting those who "profit from undisclosed information."
If you take the time to analyze the article, and know something about the US securities business, the ludicrousness of prosecuting insider trading is only further illustrated. On the other hand, we don't want to be too hard on the article as it does provide us with a nugget of important information.
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