The Highs And Lows Of Spoofing The Market

In the 1920s a group of investors, known as the Radio Pool, traded among themselves in the stock of Radio Corporation of America, the tech company of the day. They succeeded in driving up the price, took their gains and left other investors to cope with falling prices when the pool withdrew its artificial support. In a 1934 report, the United States Senate committee investigating securities trading practices found the operations of the Radio Pool and others like it troubling:

?The testimony before the Senate Subcommittee again and again demonstrated that the activity fomented by a pool creates a false and deceptive appearance of genuine demand for the security on the part of the purchasing public and attracts persons relying upon...