Jeff. Please. I mean, really.
Do you think anyone is swayed by your entirely self-serving diatribe about how the SEC’s investigation into STOCK MANIPULATION involving hedge funds, research firms and journalists, is an unfortunate attempt to stifle analysis and free speech?
Really?
Does it dawn on you that the SEC doesn’t just issue massive numbers of subpoenas and continue to pursue an active investigation because it, well, doesn’t have anything better to do?
That it must already have more-than-adequate reason to believe that it will find malfeasance and dirty deeds?
From Jeff’s weekend blog:
“Now that the SEC has declared open season on journalists and research analysts at the apparent behest of an insecure CEO cleverly shifting the spotlight away from his own money-losing public company track record, it is worth looking back to a time when such brittle, blowhard CEOs were the norm, not the exception, to glean what lessons such eras might teach to investors and regulators alike.
The era of which I'm speaking is the roaring 1990's—the last bubble period, when companies came public on not much more than a Cool Idea and a slick road show.
And anybody who wants to look back and see what happens when the SEC fails to rein in banking-happy analysts and rule-flaunting CEOs need look no further than "Confessions of a Wall Street Analyst," a new book by former telecom analyst Dan Reingold.”
Alright, Jeff, let’s dismantle the feebly-constructed statement and examine the precarious foundation of mistaken assumptions and dishonesties it uses as its basis.
First, the SEC has not declared open season on journalists and research analysts.
That is not true.
It is investigating one research firm, presumably for its possible involvement in a stock manipulation scheme involving hedge funds front-running research reports – and it is examining whether the hedge funds and research group in question used a web of about 10 journalists to disseminate their doctored information – to essentially broadcast the hatchet jobs using their cronies in the press.
That is what the SEC is doing.
Now, given that you are named as one of the bad guys on page 23, item 66 of the Biovail complaint, which alleges precisely the same behavior using the exact same research firm, it is disingenuous to pretend that this is a sweeping action against all research firms, or even most, or many, or even some.
It is against Gradient Analytics. Period. And no doubt the SEC is starting at the research firm to see how complicit the journalists are.
Not all journalists, or most, or many. 9 specific journalists out of thousands.
Just as the case against Boesky and Milken and Levine was not against all brokers or arbitrageurs or traders, this is not against all research firms or journalists.
There is no way an upright biped with a functioning cerebral cortex could make this logical blunder, hence my contention that it is a self-serving, transparent attempt to make the SEC into the bad guy.
This part of the quote is actually bizarre and incoherent, given the first part:
”And anybody who wants to look back and see what happens when the SEC fails to rein in banking-happy analysts and rule-flaunting CEOs…”
Jeff. Are you saying that the SEC was wrong when it did NOT rein in the corrupt analysts and rule-flaunting issuers?
Because what they are doing now IS reining in a corrupt analyst, and rule-flaunting hedge funds.
I think that is a good thing. Just as it would have been a good thing during the time period you speak of. But the statement is incoherent given that the first part of the blog says that the SEC is doing something bad by going after the journalists and corrupt (allegedly) analysts, and then just a few words away it is cautioning that when they allow corrupt analysts and operators to run free, that is bad.
Is it possible that you are trying to take the position that only positive research should be reined in and investigated, but that negative hatchet jobs shouldn’t? Or that crooked CEOs are bad, but that crooked journalists and their crooked hedge fund masters aren’t?
That’s just bizarre.
Unless you consider that you are one of the hedge funds that appears in the Biovail suit.
Then the agenda all makes sense.
My opinion is that you either believe your readership is the dimmest group of mouth-breathers on the planet (and you would know that better than I – my feeling is that they would have to be, to be entertained or fooled by your dross), or you are unable to comprehend that painting a turd and proclaiming it to be pure gold fools no one.
And sweetie? A thought. Byrne indicated that the SEC came to him, not the other way around, so he didn’t pull their strings and make them dance, unlike your characterization. So either you are so uninformed about the specifics of the situation you are writing about as to defy description, or you are ignoring statements by a CEO whose predictions about the trajectory of this affair have been dead right.
I won’t belabor this any more, other than to opine that we have seen a flurry of articles from much of the NY press trying to re-define this as a free speech issue, or the SEC misusing its powers, or mean CEOs victimizing innocent research firms (and their billion-dollar hedge fund clients).
And yet we have seen exactly no articles about how Gradient’s spokesperson got up on national TV and was caught in lies as she tap-danced around the obvious truth like a freakish Hillary Clinton trying to ape Ginger Rogers.
She said that reporters had access to the reports 2-4 weeks after they were released. Then I caught her in that lie using the example of the Feb. 14, 2005 research report on NFI, where Herb was trumpeting it as the reason for his latest “concerns” the very same day it was issued. Then he confesses that he had instantaneous access via the web, but hardly ever used it (sure, Herb – how many times will the phone and ISP logs show that you were in constant advance communications with them, helping with those reports?)
And yet not a single journalist has pointed that out – as it clearly demonstrates the reason that the SEC is going after the miscreants – they were in fact issuing reports they were paid to create by hedge funds, using data supplied by the hedge funds, and using a web of journalists to disseminate that negative “research” – without ever alerting anyone that it had been bought and paid for by the hedge fund/issuers, presumably to affect the stock price of the companies they had targeted.
What is the state of the NY press corps when something that large and validating about the SEC’s efforts goes unspoken, and yet article after uninformed article declares it all to be an outrage, and un-warranted?
This really has the stink of cover-up to it.
Cover-up.
An ugly word to use in conjunction with the term journalist.
And yet there it is.