At every public company, board members and top executives are automatically classified as "insiders," and are not allowed to buy or sell shares within a few weeks of major financial reports being filed. In addition, when they do trade in their own company's shares, they have to file a special form with the SEC within a day or two of each trade. Presumably, this prevents insiders from unfairly profiting personally from information they come into in their fiduciary roles.

While this sounds very logical, there are all sorts of difficulties in policing this, in practice. For instance, a senior executive at a publicly held company has to be very careful what he or she says in public, in order not to allow any hint of "inside" financial information to get out in advance of the scheduled financial reports. These restrictions create a substantial incentive for firms to provide official projections of future earnings or revenues in their SEC filings, in order to try to get as much information into the market as possible. But this just adds to Wall Street's short-term earnings fixation, pushing many firms into destructive behavior, because these official "expectations" figures can only be disseminated on specific occasions in specific, heavily documented formats.

Technology could easily do the same job of protecting the public from insider trading, while at the same time making all markets more efficient by disseminating inside information to the public. All we need to do is require real-time, on-line reporting of the identities and transactions of all identified insiders. This would disseminate information about company performance much more efficiently to the market, and it would ensure no insider would be able to profit very much, because any substantial profit opportunity would be identified quickly and arbitraged away by a host of other investors following the real-time reports of insider trades.

Regulatory enforcement would only be required to ensure that everyone who really is an insider properly registers all their securities trading transactions or accounts - probably including spouses and close associates. Twitter would take care of the rest, stock prices would be more efficient, and "gaming the system" in order to outperform or underperform Wall Street expectations would be useless, because public expectations would have already caught up to the non-public reality.