well how is using illegal information harmful to the economy|||It is cheating. The market assumes fairness.
I would be less likely to want to invest if I knew that others knew things I didn't know and could cheat me out of money because of that.|||Let us say I have a choice of buying stock in Exxon Oil or China Petroleum %26amp; Chemical Corp. (SNP). I know the executives of Exxon have to publicly report information and can't use insider information to sell or buy before I have an equal chance to be aware of the news.
With China Chemical I don't know. So I could buy it at $80 per share. In a week I sell it at $100 per share, thinking I am doing well. How pissed will I be when I learn the executives bought it at $100 per share knowing the company had fould new reserves worth $150 per share?
Will I invest in China again? Will that make the economy is China better or worse?|||Think of a poker player that can see everyone's cards although you just see the back of everyones cards. Remember....stocks show ownership and you are illegally playing against other owners. Also, if insider trading is discovered in a company, no so much economy, that can harm the credit.
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