Stevet, I sort of know what you mean but I think the MER thing is beyond restricting freedom. With freedom comes responsibility and when you are responsible you are accountable. Laws are in place to enforce that. Otherwise people wriggle out of their duty on a regular basis. The speed camera is a good analogy but then if you had someone close to you mown down by a driver going 60mph while checking stock prices on his pager, in a built up area you might feel like there should be cameras every 50'. Anyway, move to Cheshire, we haven't many cameras up here. Cheers
A book could be written about this. What the broker did was wrong. I think the regulators should send some accountants in, determine the amount of profit the company made last year, and fine them 100% of that figure. That way the company would still be in business, people would still have their jobs, and the broker and others would be less likely to lie in the future. As for the revenue from the fine, the regulator should keep a small amount to cover their expenses, and then refund balance of the money proportionally to the investors that lost money on the bogus recommendations. BUT that would just be a legal solution, a somewhat feeble attempt at justice. (The $100 million fine is NO solution, it doesn't even approximate justice. The prosecutor ends up furthering his political career, the state ends up with $100 million, and the victims end up with nothing). The real problem is that this kind of thing is the way of the world. Lying and stealing have been going on for thousands of years and there's no reason to believe that it's going to stop now. Saw a show on Joe Kennedy a few nights ago, he's the dead presidents father or grandfather . He made a fortune cheating in the stock market in the 1920's. He then used some of his money to buy RKO studios. Then he wanted better distribution so he offered to buy a competing chain of movie theaters for like $10 million dollars. When they wouldn't sell to him he hired a pretty 17 year old girl to lie and say that the owner of the competing studio had raped her. The owner was exonerated eventually but people had quit going to his theaters because they believed he had done wrong, so he was financially ruined and ended up selling his theaters to Kennedy for half of the original offer. Kennedy was described in the program as "an unscrupulous bully". The world belongs to people like this. His actions resulted in the power base for the whole future of the family. Since that time at least three men in or related to the family have been accused of being responsible for the deaths of three women, both murder and manslaughter. One thing I'm sure of. The thefts and lies that become common knowledge are just the tip of the iceberg and there's no reason to believe that things are going to change any time soon. It goes on at every level and in every way, and it always has. It is the way of the world. Complaining about it will not change it. The only thing a person can do, knowing this, is to try and deal with it as best they can and try not to become a victim. For a lie to "work" it takes at least two people. One to tell it and another to believe it. Two of the Liars' best allies are greed and fear residing in his victims. In other words, the lie needs a way "in" to the victim, so they probably in some way have participated in their loss and bear some of the guilt.
By blaming sellside analysts for losses incurred by buying their recommendation assumes that they (the analyst) had yoda-like psychic superpowers to know where the stock would be trading a year from the recommendation and that they somehow took advantage of the public. This just isn't true. One other thing. Analysts are not traders.
Dude, you're still not getting what I'm saying. I'm refering to people who put everything down on one stock and rode it to the bottom, then go looking for blood because they were duped. That's just pure greed. People who responsibly put together a balanced portfolio based on a broker's advice, then found out that advice was biased and the broker knew it was bad advice- that's different. That person was legitimately duped because he had a good reason to believe he was being treated honestly and fairly. The comparison to a doctor is a good one. By reform, I mean there are going to be a bunch of new regulations and rules coming in to govern the industry and probably restrict the investor in what they can do. Two years from now, this will be behind us and largely forgotten. Of course you can't get rid of corruption and greed, that's human nature and will always be present, just in a different form the next time this issue comes up.
Anybody who has ever tried their automated translation software knew that this thing was a goner. Actually, anybody who think that they can make good automated translation software is a goner If they say that their software does more than one language (like 5 or 6), you're looking at the Hindenburg just before that mechanic guy said "Ach! I fwill now check ze hydrochen lefel wiff ze lighted match, ya?". Elvis
The ethics of the ML situation aside, how did anyone handle it as a trading problem, which it also was? Did you short immediately upon the news they were being indicted, or did you wait until the screams of outrage reached a crescendo (and the price a near bottom) and then do a value play? And, given that those type of institutional scams and ineffectual regulatory responses are simply part of the landscape we work in, what are you going to do the next time such a situation unfolds? Me? I went long their bonds on the assumption their friends in high places would bail them out. Charlie
Merrill Got away with it and each state will get nothing in the end. This is classic you can't fight wall street scenario. With 800 Analist that right not analyst .... They just fire 30% of the staff and there you have the 10 % then they fire 15% of the regular staff and you have the other 10% then you underwrite the states bond business and you take ten % of a billion and you are now profitable. This is the Game watch and see. All this is a trick to increase investor confidence. If I were all on this board I would play merrill stock for the momentum play lon term leaps would do you all well. Old Bloomberg is a wall street favorite and Mer is a big client. Spitzer is done and he has barked up the wrong tree. STan and Dave are truly good guys its just the industry that stinks. Mer will survive the battle. You can't fight wall street.
It seems to me the way the markets operate is to take the money from the many and give it to the few. This is the outcome of trading free markets. I don't believe it can or should be changed. Merrill Lynch and others are merely facilitators in this process. They make stock picks, they execute client trades, they offer stock for sale, they trade their own accounts. But ultimately what happens is that the money always moves from the many to the few, while in between these facilitators take their cut of the action. This is not to say that the facilitators shouldn't be scrutinized more or that new regulations shouldn't be adopted making what they do more transparent. But even under ideal circumstances there will be many losers and a few winners. The names may change but the game remains the same.
eliot spitzer seems happy with the deal. eliot said, 'i do deals all the time.' eliot thinks he's an investment banker with a gun. eliot scares me. eliot reminds me of that sniveling wannabe in 'Bonfire of the Vanities.' Eliot, you are no Rudy.