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Christopher Cox Clears The Air On The SEC Subpoenas

Location: Blogs Bob O'Brien's Sanity Check Blog    
Posted by:   bobo 3/2/2006 2:45 PM

UPDATE 8:03 PM EST - Christopher Cox indicated that he will be developing new rules for determining how and when to subpoena journalists. Read all about it here. So, what does this mean? Depends upon how it is implemented - the scope of the guidance was that it would define procedures to be adhered to based upon whether a journalist was thought to be involved in a fraud, or was being subpoenaed to obtain information about others. In earlier comments I suggested that this seemed like journalists get special treatment, so how about attorneys, and mean-spirited bloggers, or virtually any special interest that whines loudly enough. I still fear that is the end result, but will withhold further comment until this becomes better defined. This is one of those "I hope I'm wrong but an afraid I'm right" moments.

As my friend commented to me earlier, when we start putting fig leaves on certain statues, we are going down a bad road. We shall see.

--------------------

Christopher Cox appeared on CNBC today, and did a nice job of clearing up a lot of the misconceptions that have been circulating about his sentiment W/R/T subpoenas issued to Herb Greenberg, Carol Remond and Jim Cramer.

Here’s what he said:

He is NOT rebuking Enforcement for issuing them. He is not angry they were issued.

The SEC is NOT voting on whether they should be withdrawn. He leaves that up to the Enforcement division.

The SEC IS meeting today to review their procedures for using subpoena power on journalists moving forward.

He is NOT against subpoenaing journalists.

He believes that journalists should be held to as high, if not a higher standard, than laymen, and made a point of underscoring that the full weight of the law would bear down upon those that were bent.

Watch the entire interview here.

So all the editorials, and articles, and hyperbole that Cox was angry, had rebuked his Enforcement division, was withdrawing the subpoenas, were wrong.

Wrong.

Or false and misleading. Take your pick. But incorrect, at the end of the day.

Let’s make a list of the articles and commentary that came out from the NY press, and that got this wrong.

List them in the comments section, and maybe I will frame them.

On another note, there is a poll being run to establish whether my new experiment in using graphics and cartoons and a mocking/sarcastic/humorous tone should continue, or whether I should quit it, and stick to earnest commentary. You have to read this stuff, so you get to decide. Please place your vote. I’ll let everyone know the results within 24 hours. The button is in the upper right hand corner of the blog.
Copyright ©2006 Bob O'Brien
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Comments (70)
Re: Christopher Cox Clears The Air On The SEC Subpoenas By browntrout on 3/2/2006 2:55 PM
So the media completely misrepresented Cox and the subpoenas? He did halt them until the commissioners could meet didn't he? Who can you believe? I did notice that CNBC never referenced Cox's statements again all day! Why was that? Yuk yuk yuk!
Cartoons By Cynic on 3/2/2006 2:59 PM
Its great to be winning the battle at this moment and perhaps that is where the humor is coming from. However, there are more and more new people to this issue that will read your blog and may not take it seriously. Stick to the facts and keep poking holes (not fun) at the bad guys.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By InTheKnow on 3/2/2006 4:44 PM
Most journalists take pride in being a good journalist and leave the bullcrap for the politicains. Some journalists are of a different caliber and will sell their souls to the devil, fortunately these journalists are exceedingly rare.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By Wonder Boy on 3/2/2006 4:51 PM
Make no mistake, I am extremely thankful that this 'issue' is finally getting some attention. Still, I have some concerns and more questions than answers.

Isn't the real problem in the enforcement of the 'settlement' of the trades? The DTCC 'clears', but they don't 'settle'. Reg. SHO had holes in it that you could drive a Kenworth through, but I see no action from the SEC or Congress to have those 'errors' corrected. FTD's prior to Jan. 2005 are still 'grandfathered'.

Your dreams come true, whatever they are---all of the Gradient folks, Cramer, Greenberg, Remond, etc. are in prision. Cohen and Rocker pay some fines. Personally, I don't want to see a 'perp walk'----I want a 'perp parade'!

Where does this leave the 'system'? Is it improved at all? Some 'bad actors' are gone, but others will replace them. Can younger workers put their social security into the markets and 'know' they are safe? Under the current laws, NO company is safe---big or small. Have any ex-clearing problems been solved?

Cox and the 'Commission' meet and come up with a plan. Aren't Atkins and Nazareth still on the commission? Do leopards change their spots? While Cox is talking, are the crooks shredding the papers and washing the discs?

All opinions welcome.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By realitymanthree on 3/2/2006 4:56 PM
How about a Gary Weiss cartoon?

Give em hell Bobo. Weiss just hit the news wires and his site was in Herb Greens Column.

We need to fight back against his Baloney Brigade web site


Of NovaStar, OmniVision and Garmin

By Herb Greenberg
Last Updated: 3/2/2006 7:09:21 PM



TENAFLY, N.J. (MarketWatch) -- The trouble with traveling is that you get out of the groove, and, with a single laptop instead of several computers, it's simply hard to keep up.

But enough about me. Lord knows there's been too much about a certain columnist in the press lately.

So to all those who have written "Hey, Herb" letters asking why I haven't updated you on this stock or that, this is your day.

For instance:

Hey, Herb, why haven't you updated us on NovaStar, which you were so quick to bash when it delayed earnings and then were so quick to ignore when it reported blowout results?

NovaStar (NFI), the subprime mortgage lender, jumped 15% the other day after finally reporting earnings.

You may recall that, several weeks ago, just after midnight, the company reported that its earnings would be delayed for two to four weeks until its tax counsel had offered a ruling, requested by its auditors, regarding an unspecified tax issue. The company offered no details on the tax issue, but, as has been the case in prior quarters, the quality of earnings in the most recent one left something to be desired. Of the 84 cents in reported earnings per share, 23 came from a tax benefit.

What was this tax benefit? There was no explanation, but this much is clear: Without the benefit, earnings would've been a disaster, representing a huge miss.

Good thing I didn't take any bets on whether the company would report its earnings within the specified delay period, as I had wondered aloud in a column when the delay was first mentioned. It did.

Oh, and in case you're wondering, its earnings quality, as of the third quarter, received a grade of F from Gradient Analytics. Gradient's Donn Vickrey said it won't be reassessed until the company files its 10-K.

Hey, Herb, why don't you give us an update on OmniVision, which you have been bashing as its stock has gone straight up?

Camera-chip manufacturer OmniVision (OVTI) reported strong third-quarter sales and earnings but guided toward lower-than-expected fourth-quarter results.

Why lower than expected? The company, in part, blamed the likelihood of lower revenue next quarter on "seasonality." Never mind that growth companies don't cry seasonality, and never mind that fourth-quarter revenue for OmniVision for the past five years has been better than the third quarter. (The season is never mentioned, of course, when results are booming.)

The real bugaboo, which the company has conceded will affect gross margins in the quarter, is average selling prices, which it says were flat last quarter.

One of the big criticisms of OmniVision by short sellers and others has been that its margins have zoomed while prices have sagged. Reality, it appears, finally matters. (For this company -- again! But don't worry, according to the company, there will be a rebound. Mañana, mañana, always mañana.)

Incidentally, a quarter ago, Gradient Analytics raised its rating on OmniVision, on which it has written since 2003, to a D from an F, while still voicing extreme concern.

Hey, Herb, are you hiding under a rock ever since Garmin blew past estimates and its stock went straight up? Garmin's (GRMN) fourth-quarter results beat estimates, and, surprisingly, the company guided higher. Critics of the maker of global positioning systems had expected guidance to be tepid. But a closer look at the numbers shows the Cayman Islands-based company, whose operations are largely in Kansas, would've barely beaten had it not been for a tax rate that was half what had been expected.

What's clear is that as competitors enter the fray, growth is decelerating. And competition isn't getting any less intense. Just this week Reuters reported that Sony (SNE) is targeting 20% of the European car navigation market in couple of years. And, according to Bloomberg, TomTom announced it would start selling three new models of Go, its main product, including one that holds an MP3 player and maps for Europe, the U.S. and Canada.

All of this competition, of course, is leading to lower prices. How, then, does Garmin expect to meet higher guidance? It hopes to make it up on volume. Time will tell. (Doesn't it always? No!)

Moving on ... family feud: The Globe & Mail of Toronto on Thursday quoted Overstock (OSTK) President Patrick Byrne's father commenting about his son in a not entirely favorable light.

Jack Byrne, the company's chairman, said that while there "may be something" to his son's claims ... I wish he would just pay attention to just running his company. That's the problem with the world today, sons don't do what their fathers tell them to do."

No, the real problem is when fathers are charged with overseeing the hiring and firing of sons at public companies.

Personal note: Thanks to the hundreds of readers who have e-mailed with their support regarding the loony - although, as it relates to press freedom, serious -- events of the past week. As I've said in e-mails and on television, I love what I do, especially when I can help you avoid losing money in the stocks of companies before they implode. Sometimes I'm early; sometimes it's a false alarm. But, more often than not, the information turns out to have been (in retrospect, of course) worth reading.

One of my favorite new blogs tries to expose an underbelly of corrupt behavior behind some of these claims. It's done by former Business Week reporter Gary Weiss. It's appropriately named www.gary-weiss.com. Weiss, whose fame is in part tied to his terrific reporting about the mob on Wall Street, is also the author of the soon-to-be published book "Wall Street Versus America: The Rampant Greed and Dishonesty That Imperil Your Investments." Among his targets: the anti-naked-short-selling crowed, which he labels the Baloney Brigade. Weiss has one of business journalism's best noses for sniffing out fraud and deceit, and, like any good bloodhound, he appears to be on the trail of something with a stench.



Copyright ©2006 MarketWatch, Inc. All rights reserved. Please see our Terms of Use. MarketWatch, the MarketWatch logo, and BigCharts are registered trademarks of MarketWatch, Inc."

Re: Christopher Cox Clears The Air On The SEC Subpoenas By S. Clause on 3/2/2006 4:59 PM
Perhaps this could help.....
Warren Buffett
C/o Berkshire Hathaway Inc.
1440 Kiewit Plaza
Omaha, NE 68131

March 2, 2006

Dear Mr. Buffett:
I would like to point out an easy investment for your company, that has already locked in a 25% dividend return. The dividend is actually 2005 profits already earned and banked. If you take a look at this company you will find very conservative management (based in Kansas City), s solid un-interrupted growth rate (portfolio of 14 billion of mortgages), a dividend rate that has increased ever year. It has also survived massive stock manipulation. The simple reason that it priced so attractively is that out of 30,870,000 outstanding shares, 36% (10,393,000) of the shares have been shorted. This does not count the millions of “naked” shorted shares sold to keep the share price from exploding. This company, Novastar Financial (NFI-NYSE) has been on the ‘grand fathered’ SHO-FTD list for some months, so average investors like myself, are not allowed to find out how many shares have been illegally shorted.
I have enclosed some information regarding ‘naked’ short selling, but I am pretty sure you are aware of it.
The ‘short’, in this case, is locked into a losing position, and has to pay out over $100,000,000 in dividends each year just to hang on. He has also resorted to several shady tactics. One is false front-running research bought and paid for from Gradient Research (now facing lawsuits & SEC subpoenas). Another are the false and misleading articles by ‘friendly’ press (also under subpoena).
What do you get out of buying a few million shares? Your get a guaranteed 25% yield on your money (or Berkshire’s) while you wait for a better opportunity. There is a good chance that your purchase may help trigger a squeeze that could lead to your investment being doubled or more, and the chance to help clean up the market by breaking this conspiracy.
What do I get out of it? A chance to recoup my original investment, most of it lost during a massive takedown. Yes, I made some poor decisions by not diversifying, and have learned my lesson. My wife is 69, and I am hoping I tell her she can stop working.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By Bodnik on 3/2/2006 5:12 PM
Bobo:
I support your cartoons for two reasons.

First, I like them. I know it irritates the hell out of the miscreants.

Secondly, You think they are effective.

For two years you have been leading point on the NSS issue, ever since they took down NFI in 2004. Your instincts have been right on in this effort in virtually every case. We are very fortunate to have a p'off retired guy on our side. I know if we had to pay for the effort and expertise you put forth we couldn't hire a group of guys for less than 450K.(Wonder what Lanny Davis charges and he hasn't done squat).

In fact, one of my biggest concerns is that the other side gets smart and buys your services for their side. Especially, since our side gives you bumpkiss and even whines about the fun you have with your cartoons.

I worry about you spreading yourself too thin. Hundreds, if not thousands of emails to sort through daily, blogs to write, comments to sort, message boards to monitor. cartoons to draw, conversations with reporters and on and on. I was hoping someone with imagination and artistic ability would step up and help you with the cartoons.

I do not mean to denigrate the efforts of many others in this crusade. They are valuable and important. This effort and success to date is the result of many people.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By Project142 on 3/2/2006 5:24 PM
EB, don't let the bastards grind you down. I can't believe how you tirelessly keep debunking their same old obfuscation tactics.

The really positive thing is that anyone with half a brain can see how Greenberg, Weiss, Cramer, all the bashers, (now Kudlow apparently too) NEVER want to talk about factual issues. They only work with half-truths, ad hominem, whining, etc. It doesn't take much investigation to discover this. More and more people are figuring this out.

The snowball is rolling, please don't give up now

BTW, I voted to keep the cartoons, the humor is a nice relief from what is a sometimes nauseating and frustrating situation.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By Kuma on 3/2/2006 5:28 PM
Bob,
I love the cartoons and humor. I voted remove because it is hard to send to people when they don't want to believe something this terrible could be happening in the first place. It gives them an opportunity to disparage. I would guess that anyone following this closely enjoys them. Anyone new has an easy way out to look the other way.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By Project142 on 3/2/2006 5:36 PM
Oh yeah I forgot they also use Gradient's impeccable and highly accurate research reports.

Unbelievable, really, this is truly stanger than fiction sometimes.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By mhatmccane on 3/2/2006 5:36 PM
Thank you for posting the link to the interview. As I watched Cox, it became very clear that the search for more information will go forward. I believe whatever doubt was there was dashed when Cramer did his "in your face" thing". Cramer made it very easy for Cox to support his staff.

As to the cartoons, you're the one who has to do the work. What do you feel comfortable with; what works for you?
Latest from Chairman Cox. By long_ostk on 3/2/2006 5:37 PM
Bobo, whats your take? Sounds to me like the Subpeonas are on.....

"The formal policy to be adopted will not require that plans to subpoena journalists first be checked with the commission, Cox said."

http://yahoo.reuters.com/stocks/QuoteCompanyNewsArticle.aspx?storyID=urn:newsml:reuters.com:20060302:MTFH09921_2006-03-02_23-50-47_N02394274&symbol=OSTK.O
Re: Christopher Cox Clears The Air On The SEC Subpoenas By rvac106 on 3/2/2006 5:43 PM
Been following the tracks of some of the articles that have been appearing, in blogs, columns, etc. Been putting in links to TheSanityCheck.Com. Was glad to see Reuter's correcting our address. How's our hit count been, today?

RVAC
Re: Christopher Cox Clears The Air On The SEC Subpoenas By bobo on 3/2/2006 5:59 PM
Hit count was higher yesterday, but today is doing nicely. We just blew away the whole vote thing as the web guy was trying to fix something, so we only have the last 12 votes. Sorry. Anyone that voted prior to about 10 minutes ago, please, vote again.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By dave on 3/2/2006 6:28 PM
I noticed that Dow Jones is in pretty tight with CNBC. For example:

http://www.cnbcdowjones.com/
or
http://www.fdch.com/cnbc.htm

The dark side reporters are at DJ:

Marketwatch: Herb Greenberg
Wallstreet Journal: Jesse Eisenger
Forbes: Elizabeth Macdonald
DJ Wire: Carol Remond AKA Redmond
Barrons: Cheryl Strauss Einhorn, Bill Alpert

It occurred to me if we spent some time googling the major shareholders and executives of stock symbol: DJ, we might find some hints to the master manipulator.

You don't get all the divisions of a company acting in concert like that without direction from senior management or the owners.

Note that the owner could be behind a fund. For example, T. Rowe Price owns about 18%. Who is behind T. Rowe Price?

No leads yet, but there is likely something here.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By dave on 3/2/2006 6:30 PM
http://www.mediainfo.com/eandp/news/article_display.jsp?vnu_content_id=1001772888
Re: Christopher Cox Clears The Air On The SEC Subpoenas By dave on 3/2/2006 6:31 PM
From the last link:

"News Corp. will promptly close all but the editorial board and merge the news staff with that of the New York Post (don’t think Rupert doesn’t have it in him)."
Re: Christopher Cox Clears The Air On The SEC Subpoenas By Kuma on 3/2/2006 6:34 PM
Bob you should update your link to the video.

http://video.msn.com/v/us/v.htm?g=35354396-6ee2-4ad6-a3ad-a375a063f896&f=
Re: Christopher Cox Clears The Air On The SEC Subpoenas By dave on 3/2/2006 6:37 PM
On Jim Cramer:

"But according to the New York Post, which has been hot on the story, Maier has since testified to the SEC about allegedly shady practices at Cramer Berkowitz. Among other things, Maier has accused Cramer of using his relationships with on-air stock market reporters, such as CNBC's Maria Bartiromo, to work a trading edge.

Under fire, Cramer has responded with his own finger-pointing. He accused Rupert Murdoch's media empire of conspiring against him.."

http://www.salon.com/tech/feature/2002/06/04/cramer/
Re: Christopher Cox Clears The Air On The SEC Subpoenas By Majordanger on 3/2/2006 6:39 PM
Sorry Bobo... no vote button appears.. but please continue to type,draw cartoons , tatoo it on yur forehead and rent a skywriter ..whatever
but keep squeeking this wheel.. ..
Re: Christopher Cox Clears The Air On The SEC Subpoenas By blackbart on 3/2/2006 7:06 PM
Cox to protect media is the way I read it tonight. Special rules for them even if they are crooks. Next he will have special rules for corrupt regulators, hedge fund managers and officers of all the brokerage firms. Then he can extend it to corrupt politicians and bankers. Then he can extend it to anyone from Dubai. Get the picture? He has already twisted his original statements to cover-up what he is really doing. That is to continue to let the crooks go free. How about those 13 day buy-ins for Reg SHO stocks. Guess we can't enforce or have a "special meeting" for that. In the mean time we get to listen to the media mainly CNBC and Dow Jones Pubs completely distort the truth minute by minute where alot of the guilty parties reside. American investors never stood a chance against these crooks and now we know that isn't going to change.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By captspell on 3/2/2006 7:17 PM
Bunny - about the survey. Your very good at what you do and I personally enjoy the sarcastic humor. However, I also believe in all things in due measure. Like my dad used to say, just keep it down to a dull roar bud. So I guess I'm saying that you are getting a LOT of exposure and perhaps those that do not know you well enough might construe your humor as a little too sophomoric ? Maybe time to put on the "serious" hat and see how the public accepts it or not. I don't know what to tell you. I voted yes as there is never any doubt about Bud Burrells posts. Professional, to the point, just the facts for the most part. Thank you for what you have done and apparently it is working quite well so is it time for a change ? I don't know. You have my respect.
Can't believe Pat's dad By Just Someone on 3/2/2006 8:04 PM
Hard to imagine a dad would diss Pat after he's gotten this far. And then not only diss him but to go to the press that has nothing good to say about him and give them more fuel.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By troydian on 3/2/2006 8:05 PM
mabey the sleeping public will awaken.... without hope well, you get it.
Can't believe Pat's dad By Just Someone on 3/2/2006 8:07 PM
But that's probably what has made Pat such a fighter. Still can't see anything constructive about his comments though.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By Just Someone on 3/2/2006 8:11 PM
I've read your blog before the cartoons and I like it more with the cartoons. The cartoons are cliff notes when I don't have time to read it all.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By rtway1 on 3/2/2006 8:15 PM
Keep the humor ,thats what got us here. If it makes the bad guys nervous , at least we got short term satisfaction, and life is too short not to have those rewards.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By Marion Polk on 3/2/2006 8:16 PM
Dear Mr. Cox,

I regret that I am unable to accept your recent subpoena, as it appears to have been issued in violation of SEC guidelines. I have been keeping a journal detailing my violations of securities laws. This obviously makes me a "journalist".
Re: Christopher Cox Clears The Air On The SEC Subpoenas By Wonder Boy on 3/2/2006 8:20 PM
That was great, Marion!
Re: Christopher Cox Clears The Air On The SEC Subpoenas By dave on 3/2/2006 8:24 PM
Google shows there are only 49 sites linking to this one.

We need thousands of sites linking here.

(There could be more as it takes Google time to notice, but we can use this a metric for our grass roots effort. Wil there be 50 sites tomorrow? )

http://www.google.ca/search?hl=en&q=link%3Awww.thesanitycheck.com&meta=
Re: Christopher Cox Clears The Air On The SEC Subpoenas By dave on 3/2/2006 8:28 PM
This site's google score (which determines the order it appears in keyword searches) is determined by the number of sites that link to it. 49 is pathetic!

For example, if someone searches for "Cramer" and Cramer's site has a lower score than this one, this site will show up first, as long as the word "cramer" shows up on the page at least once.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By Jeffrey on 3/2/2006 8:36 PM
Everyone should also go to Alexa.com and download the toolbar (free) as that will boost the site's ranking. And I see there's only two amazon reviews at Alexa, one 5 star, and one 1 star, written by Gary Weiss, it appears. Take a minute and write a good review, and lets get the toolbar so our visits count.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By Painter on 3/2/2006 8:45 PM
You can't keep humor but Cramer can wear a badge on tv? You should crank up the humor a notch. Photoshop is a wonderous tool.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By dave on 3/2/2006 8:56 PM
I will do that Jeffrey - let's all do the same.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By dave on 3/2/2006 8:57 PM
http://download.alexa.com/index.cgi
Re: Christopher Cox Clears The Air On The SEC Subpoenas By dave on 3/2/2006 9:16 PM
I posted a couple comments, but they don't seem to be live yet. Does it take some time?
Re: Christopher Cox Clears The Air On The SEC Subpoenas By whosyouruncle on 3/2/2006 9:39 PM
bobo: In your opening comments in this blog on SEC Chairman Cox's interview today, you write that the SEC is going to consider new rules on how and when to subpoena journalists (and ask since when do journalists get special treatment in the investigation of a crime). The same point is made in several news articles, and has been picked up in several earlier posts herein, namely that the Commission will adopt policies to determine the boundarties for subpoenaing journalists.

While the matter is perhaps not as clear as possible, I believe that Cox specifically denied that in answer to a question from Gasparini, along the line "so, the one case you are going to examine where the Commission is going to vote on is with journalists?" Cox said NO, I'm glad you asked, and went on to outline that they would review what considerations [ the enforcement staff] needed to take into account, before issuing subpoenas (without limitation to journalists). The inference I drew from this and other of his comments was that policy would be made with regard to all supoenas, and that distinctions woud be made depending on whether the subject of a subpoena was deemed to be a possible part of a corrupt activity or was viewed more as a witness.

All in the interest of not expanding on what admittedly was billed by the interviewers along the lines you and others wrote, but which is a distortion of what Cox actully said, imo. If, after your review, you see any merit in this position, you may want to revise or update your introduction.

Bob L.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By Hyena on 3/2/2006 11:03 PM
Looks like the polls closed early but if there is still one pregnant chad left put me down for a picture here and there and limit the cartoon to one frame.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By whosyouruncle on 3/2/2006 11:15 PM
bobo: On looking again at your blog introduction, I see that I was replying to an interpretation of Cox's comments in his CNBC interview with a lady and Charlie Gasparino earlier in the day. Obviously, my comments were based on what I saw him say to Gasparini in that segment of the CNBC show. I only now read the article by Judith Burns, later in the day, and she reported his comments after the SEC met to discuss the subject, as you reported them. I still feel that, based on his comments to Gasparini earlier in the day, as I wrote in my first post, and not having seen the Burns' interview, he intends the SEC to have a more generaL set of guidelines for all subpoenas, but confirmed that journalists would be governed by the new set of rules in answer to specific questions.. Mea culpa, for my not having read the Burns article first, before posting my earlier comments.

Bob L.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By pass out the bread on 3/2/2006 11:35 PM

Here comes the baloney brigade again on CNBC last night once again taking pop shots at Overstock. They have a personal vendetta against Byrne because he is sticking his hand in their pockets. It is in their financial interest to destroy Byrne and mock his agenda. Even Kudlow’s bias has reared its ugly head. The other night he wouldn’t show the numbers on the poll that went against what he wanted the outcome to be. He and his cohorts shouted down Patrick Byrne when he came on the show to help clear the air. And last night he and Herb Greenberg excitedly repeated a few times at the beginning of the show that Jack Byrne had stepped down and when they were finished gloating they followed it up by admitting that they don’t actually know if he stepped down. Kudlow went on to say that Jack Byrne was the best thing Overstock had going for it. Well if he feels that way why were they continually trashing Overstock before their “rumor” that Jack Byrne had stepped down?

Make up my mind Larry. Did Jack step down or didn’t he step down? Was Overstock a good company when Jack was there or wasn’t it? Are you so biased you couldn’t show the numbers on the poll when you didn’t like the results?

Sometimes you just have to say “WTF”.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By robelita on 3/2/2006 11:41 PM
ARRRRRRRRRRGGGGGGGHHHH!

I'm OK-just trying serious mode for this posting.

In keeping with a long, uniquely American, style of anti-establishment prose we follow in the footsteps of other concerned citizens from our past dating back to our pre-independence from King George III. Poor Richard's Almanac was Ben Franklin's display of altruism while a young colony unknowingly prepared itself for confrontation with its sovereign across the Atlantic. Franklin, himself, was a reluctant revolutionary and tried in vain to to cool the burning embers of protest. His allegience was to the Crown originally and after realizing the futility of compromise he finally aligned himself with Jefferson and the other scalawags of that time. Here's an appropo line fron Ben:

"There is neither honour nor gain, got in dealing with a vil-lain."

Political satire or lampooning has been with us throughout the American experience. Caricatures were the bane of politicians since our first inauguration. Editorials poked fun too but did so in a more respectable light-albeit there was considerable harshness on some of the receiving ends. Will Rogers would do rope tricks while engaging in the political dissention of his time using marvelous delivery and timing techniques which later would give rise to a generation of young comedians in the vein of Hope, Benny and the ever-affable Groucho. In more recent times we had the Warner Brothers using the cartoon medium to make prolific ideas come to the average viewer in the form of comedial entertainment. Mad-What-me worry?-magazine was yet another form of this dissention in the guise of a comic book. Rowan and Martin's Laugh-In and the Smothers Brothers used the relatively-new medium of television to delivery their parodies. George Carlin and Steve Martin used concert stages.

Today it's the internet.

Why do I babble and ramble over history you might ask. Because-boys and girls-history repeats! While this is overtly an attack upon the practice of NSS it might well have been a Teapot Dome scandal generations ago. The essence here is that when bad people try to bamboozle the unweary good people it is incumbent upon those, up to the task, to stand up to these bullies and cheats and let them know in no uncertain terms that they won't find us complacent while they pick our collective pockets.

The "I'm mad as hell and I'm not going to take it anymore" diatribe has been as much a part of our history as the shortcomings they seek to redress. So as we gain momentum think about Ben Franklin's altruism and remember you carry on a necessary-indeed noble- tradition.


THHHHHHPPPPPPPPPTTTTTT!!!
Re: Christopher Cox Clears The Air On The SEC Subpoenas By aldigit01 on 3/2/2006 11:48 PM
It would seem likely that Cox ran this by Bush or his peeps before deciding to go forward and support his Enforcement division. Bush's ratings are at their lowest ever. He needs to show positive action and since he hand picked Cox, it could give him very positive press if they proceed with the investigation. This could add impetus for accelerating things further.

Note that the Washington Legal Foundation has strong ties to the uppermost levels of the Bush administration and the WLF recently made strong statements supporting the SEC subpoenas to the "journalists". If memory serves, the WLF even commented that journalists working with hedge funds was something that needed to be investigated.

A side benefit of going forward with this might be a bit of smear dripping on Spitzer to slow his campaign for governor.

Investigation of and shutting down this network might give pause to others using not only collusive journalists and analysts but also naked shorting as a trading strategy. By centering on the collusion, they might be able to close it down without imploding the market too badly; sending a message to naked shorters that they're serious. Popping this one section of naked shorting without using Reg SHO changes means they can then deal with the next groups, one at a time as long as they're not too interrelated. They also put the FDIC in the way to cover part of the losses run up by the miscreants and not hit the prime broker too hard.

IMO.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By mfairview on 3/3/2006 2:57 AM
Bob, It might be interesting to have a section on your blog that allowed people to post incriminating evidence against those individual in this case (emails/articles/etc). It would be nice to collect all that data from the various victims they've trampled in their wake. I note this one that was recently posted out on NFI.


We have spent literally dozens of hours responding to Mr. Greenberg's questions, his follow-up questions, and the follow-up questions to his follow-up questions. Each and every time, we try to give him the facts that can be confirmed as undisputed. But, each and every time, he has ignored most of these facts or distorted them into negative inferences. This is most unfortunate.
We would appreciate it if, in the future, Mr. Greenberg's editors reviewed his statements to ensure they are accurate. Furthermore, we plan to give Mr. Greenberg the following blanket statement if he calls us in the future about NovaStar for his columns:
"We are confident in our business model, past and future performance of profitability, and the accuracy and completeness of our publicly filed financial statements and other press releases and our commitment to transparency. We regret that sometimes we are unable, on a day-by-day, sometimes hour-by-hour basis, to respond to Mr. Greenberg's multiple and continuing questions. We will continue to do our best to respond to all legitimate questions from any journalist, with our answers available to the general public."
Sincerely,
Scott F. Hartman
Chief Executive Officer

http://tinyurl.com/ly8wz

Your thoughts?
*** A Must Read *** By InTheKnow on 3/3/2006 3:09 AM
A must read:
First Section of Dr. DeCosta's Chapter 42 - On The @DTCC Larry Thompson Self-Interview
Location: Blogs Dr. Jim DeCosta's Blog
Posted by: jimdecosta 3/2/2006 4:47 PM

Re: Christopher Cox Clears The Air On The SEC Subpoenas By dave on 3/3/2006 7:35 PM
Mfairview - excellent idea!
Re: Christopher Cox Clears The Air On The SEC Subpoenas By mhelburn on 3/4/2006 10:50 AM
Notice who is providing the information about subpoena "withdrawal"

Article from Globe and Mail..Overstock 'happy' to assist Biovail lawsuit
Internet firm also suing Gradient
LEONARD ZEHR AND PAUL WALDIE



"The issuance of a subpoena to a journalist which seeks to compel production of his or her notes and records of conversations with sources is highly unusual," Mr. Cox said in a statement.

Mr. Cox told Bloomberg News he plans to hold a meeting of commissioners within a few days to consider when it is appropriate to subpoena journalists. One of the reporters who received the subpoena confirmed yesterday that it had been withdrawn.

"But bottom line is that I'm no longer being asked to provide the SEC all of my "unpublished" communications, including e-mails and phone records, between me and people and organizations," said Herbert Greenberg, a columnist for Dow Jones' MarketWatch.com. Mr. Greenberg referred a request for an interview to lawyers for Dow Jones.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By hwh on 3/2/2006 3:06 PM
Dear Robert: Be humble in victory & loss. Be kind to people on the way up the ladder because you may need them on the way back down. Let your professionalism be the example they must meet to earn respect. Do not become a game show like MAD MUNY. Sincerely, you're the best. Stay that way...hwh
Re: Christopher Cox Clears The Air On The SEC Subpoenas By Joseph Avenius on 3/2/2006 3:07 PM
IF this ever gets really cleared up, I will be so excited to see all the talking heads & paper media go on breathlessly about what a complete SHOCK, I repeat SHOCK this is, and how could it of happened. This gang make Pravda sound like Edward R. Morrow!
Once you know the truth you need a shower after you listen to them, just to get the slime off.
Side note- wasn't able to play the video.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By Skeptical on 3/2/2006 3:08 PM
But, the Enforcement division are not enforcing the subpoenas. This seems just a little bit coincidental.Why would they need to vote to withdraw, it's already happened?
Re: Christopher Cox Clears The Air On The SEC Subpoenas By bburrell on 3/2/2006 3:16 PM
Stick with the mocking, sarcastic, humorous cartoons. They are making your postings both more entertaining and more informing. And I know the difference.

Satire is a powerful, powerful tools in the hands of someone intelligent enough to use it well.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By bobo on 3/2/2006 3:18 PM
I don't think that there is any real definitive to have come out yet on whether they are going to move forward with the subpoenas. What did come out is that they didn't have to ask Cox or alert him that the subpoenas were issued. So that is pretty clear - oh wait, exactly as I said.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By mhelburn on 3/2/2006 3:23 PM
I love the cartoons. This is a very serious issue with co-opted journalists, overworked regulators, criminals syphoning off the earnings of retirees , and the ruination of our market system. It is a little hard to swallow and pointing fun at the miscreants who have driven things to this point sends a very clear message. They have been punishing and stealing from investors for a very long time and paybacks are great. I listened to what Cox has said and I wondered how anybody over the age of 25 could put any spin on it. He was clear. He didn't rebuke anyone. He actually made statements that supported the rank and file. There are some spin doctors out there and they got it all wrong and now they are shown to be incompetent and unable to understand clearly spoken and written English. It proves that people hear what they want to hear and you should only listen to the source and make up your own mind.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By bphaere on 3/2/2006 3:32 PM
For those new to the site, the subject, and the characters, it is difficult to know where reasoning ends and humor begins.

Save the humor for the clearly labeled Sunday Comics.
Re: Christopher Cox Clears The Air On The SEC Subpoenas By browntrout on 3/2/2006 3:35 PM
Reuters carrying new story now: U.S Securities and Exchange Commission Chairman Christopher Cox said on Thursday the commission intends to adopt a formal policy on the use of subpoenas against journalists based on past practices.

Cox said the commission hopes to develop its new formal policy "within one to two weeks."

He said he believes that, after the policy is adopted, issuance of SEC subpoenas to journalists "will continue to be exceedingly rare."

Re: Christopher Cox Clears The Air On The SEC Subpoenas By anon on 3/2/2006 3:39 PM
"It is difficult to know where reasoning ends and humor begins."

For some maybe, for the rest of us with an IQ over 100 they are both educational and comic relief.

Do you also not like speeches that start off with jokes?
Re: Christopher Cox Clears The Air On The SEC Subpoenas By rvac106 on 3/2/2006 3:41 PM
Bobo,

My vote is to separate the cartoons out. In fact, if any of our army are artists, make a 'cartoon corner.' Don't most editorial cartoons appear on the editorial page? Isn't this entire blog one big editorial? While I personally hate to segregate, in this instance, I think it would add, and not detract, from the message contained herein.

RVAC
Re: Christopher Cox Clears The Air On The SEC Subpoenas By BrainDamage on 3/2/2006 3:43 PM
I'm torn as to the cartoons...personally I love them, but it means a lot more work for me when I go reposting your pieces to my favorite haunt (a CMKX message board) in order to include the illustrations!

Lately the colorful entires have been coming so fast and furious that I just copy the part up until the first graphic, and then tell board members to click on the link (which I always provide) to go see the entry in its full-colored glory...
-BD
Associated Press 3/1/2006 By mhelburn on 3/2/2006 3:50 PM
MARKETS
CNBC's 'Mad Money' Host Was Subpoenaed by SEC
TheStreet.com, which carries Jim Cramer's column, also was told to turn over records.
From Associated Press
March, 1 2006


A second financial news organization was subpoenaed for records in an investigation by the Securities and Exchange Commission, whose chairman has put the subpoenas on hold amid controversy.

TheStreet.com and co-founder and major shareholder Jim Cramer were served subpoenas by the SEC about three weeks ago in connection with an inquiry into allegations of stock manipulation. Two columnists for Dow Jones & Co. online publications, Herb Greenberg of MarketWatch and Carol Remond of Dow Jones Newswires, also received subpoenas in the SEC investigation related to online retailer Overstock.com Inc.

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Jordan Goldstein, general counsel of New York-based TheStreet.com, said Tuesday in a telephone interview that the company had objected to the subpoenas dated Feb. 6 demanding records of communications. He declined to comment further.

SEC spokesman John Nester declined to comment.

Dow Jones, which also publishes the Wall Street Journal, also had objected to the SEC subpoenas.

SEC Chairman Christopher Cox took the unusual step Monday of halting the agency's pursuit of the subpoenas until its five commissioners consider the matter, possibly on Thursday.

Cox suggested that SEC enforcement attorneys should have consulted him before issuing the subpoenas because of the sensitivity of ordering journalists to hand over records.

The SEC rarely subpoenas journalists or news organizations.

"This is unusual. I don't think I've ever seen a subpoena pulled back before" by the SEC, said James Cox, a professor at Duke University who specializes in securities law. The move "creates some level of tension" between the agency's enforcement attorneys and Cox's office, he said.

Cramer, who writes a column for TheStreet.com and is the colorful and hyperactive host of the "Mad Money" show on cable TV network CNBC, disclosed on the program Monday night that he had been subpoenaed.

The SEC took the action because "I said the stock was going lower," Cramer said, referring to shares of Overstock.com.

"I didn't get the subpoena because I'm corrupt," he said.

"I got it because I tried to get people out of a stock that we said was going lower and went lower."

Similarly, Greenberg and Remond have written columns that were critical of Overstock.com and its chief executive, Patrick Byrne.

The retailer has accused research firm Gradient Analytics of issuing negative reports on it in exchange for payments from a hedge fund seeking to profit from a drop in its stock price.

Overstock has sued Gradient and the hedge fund, Rocker Partners. They have denied wrongdoing.

After issuing the subpoenas early last month, the SEC decided last week against compelling the journalists, at least for now, to surrender telephone records, e-mails and other documents that the agency was seeking in its investigation.

Shares of TheStreet.com fell 16 cents Tuesday to $7.76.