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Short Sighted

As if it weren’t bad enough that Republicans were deliberately blocking bills that would help the economy, in order to win elections. We almost expect that of them.

But this is the height of cynicism and hypocrisy.

Ohio’s Senate race is neck-and-neck, with progressive Sherrod Brown pitted against Republican Josh Mandel. Mandel vocally opposed raising the debt ceiling last year, and has indicated that he would vote against it if elected to the Senate. If the government is not able to meet it’s financial obligations it will cause a default and likely financial chaos.

But Mandel won’t feel the pain. Both he and his wife have invested in financial instruments that “short” US Treasury bills. If the government defaults, the value of Treasury bills would go down dramatically, and this investment — which bets against Treasury bills — would shoot up in value.

Seriously. Not only is Mandel voting against the US economy, he’s betting against it.

Should we be surprised? Last year, it was discovered that Eric Cantor — the Republican’s chief debt ceiling negotiator — had an investment in the same financial instruments.

This may be the ultimate in cynical insider trading, but despite a new law that explicitly bans members of Congress from insider trading, that law only applies to trading using confidential information they receive as lawmakers. In addition, that law was weakened by Republicans before it was passed, and according to the New York Times “prosecutions would still be difficult”. For now, the best way to stop politicians who bet against the country they are sworn to protect is to vote them out of office.


© Clay Bennett

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4 Comments

  1. David Freeman wrote:

    Calling this “the height of cynicism and hypocrisy” doesn’t leave a lot of room overhead for the truly mendacious habits of rupugnican politicians.

    In both cases, Mandel and Cantor, less than $15000 is invested. I’m no financial wizard but that sounds like a pretty modest hedge bet. Even if that less than $15001 bet does “shoot up in value” the profits are likely offset by losses in other investments.

    IMHO they’re both horses asses but not for this. Cantor is dumb as a rock but surely his bet would have been larger if he had really planned to tank the economy for personal financial gain.

    With all the mountains of shit they’re saying, why point out this mole hill?

    Monday, July 30, 2012 at 10:54 am | Permalink
  2. Iron Knee wrote:

    Mandel was required to disclose the approximate size of his investment, but it is also known that his wife has a similar investment, and we don’t know the size of it.

    Also, even though the investments of Mandel and Cantor seem relatively small (less than $15K), their value could shoot up dramatically if the US defaults.

    And finally, how does the size of the bet matter? I don’t care if they only bet $1 (like the gentlemen’s bet in “Trading Places“). Politicians should be concentrating on improving the economy of their country, not betting against it.

    Monday, July 30, 2012 at 11:15 am | Permalink
  3. David Freeman wrote:

    “could shoot up dramatically” sounds significant but I have no idea what it means. What about their other investments? That $15k would have to go up by orders of magnitude to impact these fat cats even assuming that their other investments remained static and did not plummet for the same reasons that the shorts rose.

    Josh Mandel’s family net worth is about $7.4 million. According to June 14 Financial Disclosure Forms, Eric Cantor had a net worth of at least $3 million.

    I still say you’re stumbling over a mole hill among the mountains. But ’nuff said , I’m tired of defending the indefensible for being only slightly less reprehensible than you think :-)

    Monday, July 30, 2012 at 11:47 am | Permalink
  4. Dan wrote:

    The Economy will never improve so long as Republicans hate Obama more then the love their country. Hey, why not make a couple bucks off it. I’m thinking the the chance of America defaulting should be slim to none, so like any bet on a long sho,t winning should bring a pretty healthy return on the dollar.

    Monday, July 30, 2012 at 3:03 pm | Permalink

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