🚀 go-pugleaf

In article <1992Nov14.204107.6898@clarinet.com> Brad Templeton
writes:


>A smaller case to consier on this issue is that of stock markets and
>publicly traded companies.   Right now the rules (backed up with laws)
>require that all transactions be in the open, and that all information
>used in deciding a transaction be in the open.

>What is the effect of secure cryptography on insider trading?  With
>routine cryptography, will it be possible to detect the transmission of
>inside information?  Will stock traders have to live in bubbles, forbidden
>to receive any encrypted messages?  Or instead would anybody wishing to
>trade on the market be required to keep a database of all their keys, so
>that in the event of a warrant, all their transactions could be cross-matched
>and checked for inside information?

Well, so much for an open society.

However, the case Brad cites is actually a point in favor of private
cryptography.

Whether I was trying to build an environment against being accused of insider
trading or merely trying to affirmatively do my fiduciary duty, it would
seem that I would _want_ to use cryptography to encrypt any insider 
information before I sent it out.

Recall that many insider cases are related to various sorts of one company
buying out another.  Therefore, there is plenty of computer-to-computer
link-ups that, by definition, probably never occurred before and probably
happen over ordinary phone lines.

I certainly wouldn't want a hotshot government prosecutor, after the fact,
claiming that somebody who tapped my line and got the information in the
clear text was not conspiring with me.  That is, I would have the potential
of trying to disprove that I tipped the other fellow off and I knew about
the wiretap.  Even were I innocent, conspiracy could be very hard to disprove 
if the tapping person knew me or knew someone I knew.  And, the government
is going to view me, as a principal, as one of the "big fish" to get.

It is said that almost everyone on earth is interconnected to everyone else
by at most two or three acquaintances.  My uncle used to work in the White
House, for instance, so I have only one person between me and Ford, Nixon,
and Reagan.  My grandfather was a McGovern supporter from so far back it
does not matter.  Clearly, McGovern knows Clinton, so it is at
most two for him.  And so on.

Knowing this reality, why shouldn't I insist on private cryptography?  And,
for that matter, one in which there is no government-run "golden cookie jar"
with all keys therein?

It has certainly been the case where the failure of one arm of government
did not prevent me from being prosecuted or sued by another.  If my key is
stolen, I still have to disprove the conspiracy angle from whomever happened
to steal it from the government's golden cookie jar.

Of course, we've done stupid things before, so maybe it is time for another
stupid thing. . .

-- 
   Larry W. Loen        |  My Opinions are decidedly my own, so please
                        |  do not attribute them to my employer