The Most Powerful Woman in Congress Made $1.3 Million in 78 Days, and Hardly Anyone Noticed.
She banked six times her annual salary with a single stock investment.
Whether you love or loathe her, Nancy Pelosi knows how to play the game.
Some of my favourite moments involving Pelosi were her epic clashes with Donald Trump.
The pair despise each other.
Trump famously came out and said, "Pelosi is a sick woman. She's gotta lotta problems, mental problems".
Their altercations were box office, especially one Pelosi interview that went viral after Trump promoted Hydroxychloroquine during the bat virus outbreak.
Nancy Pelosi —Source
“He’s our president, and I would rather he not be taking something that the scientists have not approved, especially in his age group and, shall we say, his weight group. Or morbidly obese, as they say”. Lol.
After Trump's State of the Union speech, as a part of protocol, he handed the notes of his remarks to House Speaker Pelosi, who, a moment earlier, had announced the impeachment inquiry into Trump.
Pelosi reaches to shake his hand, but Trump snubs her by turning around and leaving her hanging. Moments later, she rips up his speech live on air.
Soon after, a reporter asked her, "What did you think of Trump's speech?" Pelosi replied:
“I tore it up. I was trying to find one page of truth on it”.
While Trump doubts her mental capacity, one thing is clear: Nancy Pelosi is fully aware of how to allocate capital regarding her investments.
She's such a good stock trader that people in the general public have resorted to copying her trades.
A site tracking her stock portfolio has listed her as the 5th best trader in Congress.
So far, her portfolio is up nearly 80%, with an estimated value of over $200 million.
When it comes to politicians and money, we tend to scrutinise their every move with surgical precision.
Pelosi responds to critics who say she shouldn't be allowed to trade because it provides her with an unfair advantage:
Nancy Pelosi: “This is a free market economy, and everyone should be able to participate in that.”
In 2012, the Stock Act was passed, requiring all members of Congress to report a stock trade within 45 days.
The whole point was to alleviate concerns about insider trading and inject some integrity into these sneaky politicians.
The Act also made it illegal for members of Congress to use nonpublic information to front-run us, regular folks.
But with Nancy, things get messy.
On November 22, 2023, Pelosi and her husband invested in Nvidia ($NVDA) calls.
A call option is typically used when the investor believes the underlying asset's price will rise. This allows them to profit from buying at a lower price (the strike price) and selling it at a higher market price.
You're betting on the price increasing, which is the opposite of a "Put" option.
Soon after Pelosi's bet on Nividia, the A.I. companies' income went to Valhalla, surging by 77%, earning her $1.3 million in just 78 days, more than six times her annual salary.
Things get murky when you rewind the clock a bit further back.
In the summer of 2022, an in-depth report revealing her stock purchases showed that Nancy Pelosi was trading millions of dollars of ($NVDA)Nvidia before voting on a U.S. semiconductor bill by the Biden administration.
The report gained traction online, sparking outrage, but failed to ignite significant attention in the lamestream media.
The unwanted attention prompted Nancy P. to disclose trades for the first time on the same day they were made.
It was the fastest trade disclosure in the U.S. Congress's history.
Pelosi then reported that she sold out of her Nvidia position due to a conflict of interests. Despite taking the full 45 days for every other disclosure as required by the Stock Act, she made this one on the same day of the trade.
The NASDAQ reported:
“The Pelosi’s announced they had sold 25,000 shares of Nvidia at an average price point of $165.05, with a loss of $341,365.”
Pelosi and Representative Lofgren proposed a trading ban for Congress one month later. However, people thought the bill was weak because it had more loopholes than a spaghetti strainer.
So true to her virtue signalling proposed ban, Pelosi stopped trading.
That's until she dived back in with her $NVDA leveraged bet.
One week after Chinese President Xi visited her home state of California and before the Biden administration tightened export controls for "cutting-edge intelligence chips to China", she and her husband purchased 2 million dollars of Nvidia calls.
Remember, they're betting on the stock to increase while the general public is under the impression the government has planned to tighten regulation.
It's not making sense.
This is the same company Nancy had divested from a year earlier due to a "conflict of interest".
Worse, on December 11, after her stock purchase in November, U.S. Commerce Secretary Raimondo said in an interview with Reuters, "Nvidia can sell A.I. chips to China, just not those with the highest processing power."
This confirms that there were proposed restrictions, which would likely be negative for the stock price.
Then, on December 28, NVDA launched a modified version of an advanced chip to get around these U.S. restrictions.
The question I ask myself is, in light of the restrictions imposed by the government, which Pelosi would have been privy to, why is she and her husband betting so heavily on the increase in stock price?
How could she have known Nvidia could arrange a workaround unless she had information we weren't privy to?
It could be an unforeseen stroke of luck that their one-time stock trade unfolded this way.
Nvidia released new U.S. chips, and their stock price has hit all-time highs.
But there's more.
Congresstrading, an X account (formerly Twitter) that tracks congressional members' trading activity, said Nancy Pelosi's timing of announcing the trade was no coincidence.
“Pelosi bet millions on $NVDA in November using call options. Using a deceptive tactic, she purposely disclosed this on the Friday before Christmas weekend to avoid media coverage.”
This investment fuels Pelosi's already fiery track record of controversial trades, including investments in over a dozen IPOs, namely Visa, during the Great Recession, which she purchased before a stimulus bill.
The timing reeked of suspicion.
Just as a menacing piece of legislation that would have hurt credit card companies began making its way through the House, Pelosi and her husband purchased 5,000 shares of Visa at the initial price of 44 dollars.
Two days later, it was trading at $64
Reports showed that Visa was engaged in a lobby with Pelosi to stop legislation that intended to curb credit card swipe fees. Visa also donated to Pelosi's re-election campaign.
This lobbying (influence-peddling) happened after Pelosi's stock transaction. Because heck, she now had some skin in the game, so it was time to pump her bags.
A news correspondent for 60 Minutes, Steve Croft, famously put Nancy on the spot during a press briefing, and she was like a deer caught in the headlights.
News reports ran with the headline "Nancy Pelosi had a meltdown".
Steve Croft — Source
“I wanted to ask you why you and your husband back in March of 2008 accepted and participated in a very large IPO deal from Visa. At the time, there was major legislation affecting the credit card companies making its way through the House. Did you consider that to be a conflict of interest?”
Nancy Pelosi answered: “I don’t know what your point is (stutter) to your question. Is there some point you want to make? Your basic premise is a false one.”
Final Thoughts.
I wanted this blog to be something other than a hit piece, but the smoke without fire here does raise some reasonable questions.
Nancy P's Nvidia calls have raised some eyebrows.
In the U.K., where I live, politicians are encouraged to have a blind management arrangement for their private investments.
The point is to allow a person to hold an investment without influencing the asset's performance or front-running joe public.
It's something that was introduced in 2019 by Rishi Sunak.
But the public outcry now is: "Well, what exactly are you politicians hiding?" Lol.
Politicians are caught between a rock and a hard place, no matter which way they turn.
While everyone should be able to participate in the free market, front-running is undeniably a shady practice that is all too common.
It's sly, subtle and underhanded, and it's not just Nancy Pelosi scraping the icing off the top of the cake.
Take Congresswoman Kathy Manning, who Tweeted: "We must hold Iran accountable" just five days after she purchased a chunk of Lockheed Martin's stock ($LMT).
They're a defence contractor.
Manning is on the Committee on Foreign Affairs, which oversees legislation on military deployments abroad.
Kathy Manning — Source
“I’m heartbroken to learn that 3 brave U.S. service members were killed in Jordan by Iranian-backed proxies. My thoughts are with the families of the soldiers who lost their lives and those injured.
We must hold Iran accountable.”
The ethics of investing, particularly as a politician, are razor thin.
But it's like an old boss used to say to me, "Jay, never mix work with pleasure — nothing good ever happens".
I agree.
It's asking for trouble.