WHEN INVESTING BECOMES A LIFESTYLE YOU WEAR IT!

NEW MERCH ALERT - WEALTHY RED - Limited Quantities - Grab Yours Today! CLICK HERE

RAGE AGAINST THE RIGGED MACHINE…

You would have to be extremely naive to believe that Wall Street is fair and equitable. It’s more like a gang disguised as a brotherhood of professionals who operate at the highest caliber.

Instead, what you will come to realize is that for the love of the almighty dollar, they will snitch on their grandmother to make a quick profit. Wall Street is an assortment of misinformation and black shadow dealings, and everyone is involved—the traders, the institutions, and the analysts all play their part.

For instance, an analyst rarely puts a sell recommendation on a company's stock.

In fact, according to FactSet there are 12,319 ratings on stocks in the S&P 500. Of these ratings, 56.4% are Buy ratings, 38.7% are Hold ratings, and 4.9% are Sell ratings.

Analysts worry that issuing a sell rating will anger the CFOs and executives of the companies they cover.

This can lead companies to retaliate by cutting off the analyst’s firm from lucrative business opportunities, such as stock offerings and merger deals, or restricting access to key executives and information.

After all, who wants to talk to an analyst who trashed their stock?

A survey showed 88% of analysts feared such retaliation, and 54% believed sell ratings could cause temporary exclusion from company briefings.

So, the question remains if we can’t trust an analyst to operate in good faith because of a vested interest. How do we trust the integrity of a hold, buy, or sell rating if the analyst is more in tune with winning investment banking business, as opposed to the retail clients they serve?

Analysts covering stocks that generate substantial underwriting or investment banking fees for their firms receive higher compensation. Pay increases roughly 6-7% for each million dollars in underwriting fees generated by the stocks they cover.

And while taking a soft shoe approach to win a company's business is not illegal, how does it help the unsuspecting investor relying on the analyst title to carry weight?

If you think because you are dealing with a reputable firm—misdirection comes in all forms—take Goldman Sachs’s Subprime CDO Trades between 2006-2007 :

In the lead-up to the 2008 financial crisis, Goldman Sachs marketed collateralized debt obligations (CDOs) like Hudson Mezzanine with materials touting “aligned incentives,” neglecting to disclose the firm’s significant bet against those very assets.

Investors were led to believe these mortgage-backed securities were sound, while Goldman had secretly positioned itself to profit from their collapse, worsening losses during the financial crisis.

The strangest part is that Wall Street created the financial crisis of 2008, but because it threatened the integrity of the entire financial system, they were bailed out by the federal government through the Emergency Economic Stabilization Act of 2008, which created the Troubled Asset Relief Program (TARP). This program authorized up to $700 billion to buy toxic assets and inject capital into struggling banks and financial institutions to stabilize the financial system.

The bailout was prompted by the near collapse of major firms like Lehman Brothers and AIG, aiming to restore investor confidence and prevent further systemic failure.

As for consequences, while the bailout helped stabilize the economy and the government eventually made a profit on the investments, Wall Street firms faced numerous fines and penalties in the aftermath. Major banks, including Goldman Sachs, Bank of America, and others, were fined billions of dollars for various misconduct related to the crisis, such as risky mortgage-backed securities practices, predatory lending, and securities fraud.

Although these fines were significant in absolute terms—totaling hundreds of billions globally—they were often relatively small compared to the firms’ overall assets.

So, in other words, it was a billion-dollar slap on the wrist.

In fact, not one top executive was served jail time; only one notable case involved Kareem Serageldin, a Credit Suisse bond trader who went to jail for bond price manipulation related to mortgage-backed securities during the 2008 financial crisis.

He pleaded guilty in 2013 to fraudulently inflating bond prices to hide losses and was sentenced to 30 months in prison, making him the only banker in the U.S. to be jailed for conduct linked to the crisis.

With this type of community immunity, there is no real incentive to change the behavior, especially if the government eventually wins from the bailout and Wall Street goes back to business as usual.

Mike Milken, the junk bond king, went to jail because he pleaded guilty to six felonies related to securities and tax violations, including conspiracy, securities fraud, mail fraud, market manipulation, and helping clients evade taxes.

He was convicted of activities such as hiding stock ownership to mislead regulators, falsifying records, and aiding clients in tax evasion schemes.

These charges were part of a broader investigation into financial misconduct on Wall Street in the 1980s.

Milken was sentenced to 10 years in prison, but served about two years before his sentence was reduced due to cooperation and good behavior.

His convictions were not for insider trading itself, although the larger investigation involved insider trading cases. Milken accepted a lifetime ban from the securities industry and paid hundreds of millions in fines and settlements. He was later pardoned by President Donald Trump in 2020, and he got to keep all of his billions. He is now worth 7 billion dollars as of August 2025.

This is Wall Street's Good Ole Boys’ club, and it is a community that protects its own. So, don’t think for one second the machine is not rigged for those institutional players who have the entry fee.

TRUMPFLATION - MAKE IT RAIN…

Question: How do we trust the politician who seeks to enrich themselves off of constituents they serve?

There are allegations in the Trump administration where allegations have been extensively made about President Trump and his close associates using government power for personal financial gain, including benefiting wealthy campaign donors and family businesses.

This is a concern because some of the appointed officials are the same billionaire donors who  can influence policy through the positions they hold in government. Starting with Political enrichment from the “big beautiful tax bill” primarily benefits wealthy individuals and large corporations through several mechanisms:

The bill extends and expands tax breaks that disproportionately favor the rich, such as lowering corporate tax rates and increasing the amount wealthy people can pass on tax-free to their heirs.

It allows large companies to avoid paying taxes and enables them to give bigger dividends to wealthy shareholders.

The wealthiest 1% of Americans receive the largest share of tax cuts — for example, average tax cuts could reach around $36,000 to $65,000 annually for top earners, while middle and lower-income groups receive much smaller benefits or face tax increases.

Specific provisions like increasing the state and local tax deduction cap from $10,000 to $40,000 per filer mainly help wealthy individuals with high incomes or expensive homes.

And if the tax advantages weren’t enough, we now have government officials benefiting from the regulations they take part in, which is a form of insider trading from which there is very little recourse.

In fact, several lawmakers are very active traders, with some conducting hundreds of trades and moving tens of millions in volume annually, such as Josh Gottheimer with 526 trades and $91 million in volume, and Nancy Pelosi with 17 trades and about $38 million in volume recently.

The Stock Act calls for disclosure of trades and imposes certain restrictions and fines, but they are loosely enforced.

The STOCK Act (Stop Trading on Congressional Knowledge Act of 2012). This law:

Prohibits members of Congress and other government employees from using non-public, insider information obtained through their official duties for private profit, including insider trading.

Requires timely public disclosure of all stock trades and other securities transactions (valued above $1,000) by members of Congress, usually within 30 to 45 days of the transaction.

Mandates transparency to allow for public scrutiny and accountability, although enforcement and penalties have been criticized as weak due to the $200 fine per offense, which is not strictly enforced.

Prohibits special access to IPOs (initial public offerings) for members of Congress and requires disclosure of mortgages and financial interests to mitigate conflicts of interest.

Nothing in the Stock Act says they can’t make money in the stock market as elected officials. And if Wall Street can get away with blowing up financial bridges, politicians can profit and look the other way in terms of Regulation.

This bleeds dangerously close to manipulation and nationalization.

For example, in April 2025, Trump posted on social media, urging people to buy stocks just hours before announcing a tariff pause that led to a sharp market rise. Some senators and ethics experts suspect this may constitute market manipulation or insider trading, potentially enriching insiders who had advanced knowledge.

And although Democrats in the Senate have formally requested the SEC investigate possible misconduct, including whether Trump or insiders traded on advanced knowledge and manipulated markets, legal experts and regulators emphasize several points:

To prove unlawful market manipulation under U.S. securities law (Rule 10b-5), there must be evidence of intent to create a false or misleading market condition. So far, Trump has not made false statements about tariffs; he announced actual policies that moved markets legitimately.

Insider trading laws prohibit trading on material nonpublic information, but it is complex in this case because the President “creates” the policy information himself. At this point, there is no formal investigation by the SEC, and I doubt we will see one, given that Trump is a sitting president.

And to this date, there has never been a president so involved with what happens in the market.

Trump, through the Department of Defense (DOD), invested 400 million in MP Materials for a 15% stake, making it MP Materials' largest shareholder.

And more directly, President Donald Trump publicly called for Intel CEO Lip-Bu Tan to resign, labeling him as “highly conflicted” due to Tan’s investments and connections with Chinese companies, some linked to the Chinese military. Trump made this demand through a post on his Truth Social platform.

Trump's influence weighs heavily on the markets, and Wall Street institutions love the volatility and the for-profit agenda.

If it’s not an executive decision, tariff policy, or a tweet on X, one thing is for certain: the markets are in for a wild ride.

WHEN INVESTING BECOMES A LIFESTYLE YOU WEAR IT!

NEW MERCH ALERT - BUY THE DIP NAVY - Limited Quantities - Grab Yours Today! CLICK HERE

Quick Links…

Peace People, It’s Been Real…

The Number is 81%…

Thank you for reading, we appreciate your feedback—sharing is caring.

Kevin Davis Founder of Investment Dojo and Author of The C.R.E.A.M. Report