1521 Convestments

An interesting factoid was published recently. Turns out our congresspeople, those we often blame for screwing up the economy, are pretty darn good investors. The stock portfolios of members of the U.S. House of Representatives outperformed the market by an average of 6% annually from 1985 to 2001. Senators did even better, "…significantly outperforming even hedge fund managers."
Isn't that odd? Here are the folks who are supposed to be regulating the financial markets, and they're making a killing off them. The folks Wall Street tells us shouldn't regulate them because they know nothing about the complexities of trading and they're out-trading the tried and true traders.
There are a number of possible explanations: "Dumb luck" floats to the top of the cesspool. Or Congressional people can afford to hire better investment counselors. Still, even the best investment counselor is only as good as his or her knowledge of factors in the market.
Hmmm. If you were a congressperson you'd have some inkling of market factors before anyone else. A big trade deal coming up for a vote maybe, or a treaty that could affect political stability in some part of the world. Maybe just whether the next big corn subsidy is likely to pass. In short, insider knowledge. Hey, you work hard for your country, what's a little insider trading spiff gonna hurt? You can make laws, why shouldn't you break them?
Then again, you have a leg (or should I say lege as in legislator) up on even insider traders. You can be an insider manipulator, actually shape world events, affect the market directly with a well-timed vote. Which could help explain the willy-nilly voting records we sometimes see on both sides of the aisles.
And out of those many factors, profit.
E Pluribus Portfolio.
America, ya gotta love it.