I have to comment on the return of disgraced analyst/internet maven/ and founding contributor to the tech implosion of 2000, Henry Blodget. For those of you who don’t remember, Henry made his name back in 1998 by predicting Amzon.com would rise to $400. And it did, and it did so by doubling in a matter of months (even rising above $600 on a split pre-basis before the bubble burst sending the stock back to single digits split-adjusted in 1991).
After the bubble burst, Henry and his reputation fell on hard times. It seems that emails were discovered that plainly showed in private, his personal feelings about the stocks he was formally pushing at Merrill, Lynch were very much contrary to his public recommendations. In 1993 he was fined $2 million, forced to disgorge $2 million in ill-gotten gains and he was permanently barred from the securities business (link to SEC release). With this track record why would he be allowed to profess investment advice anywhere? Well, the same First Amendment that protects my right to rant and rave in kortsessions, protects Henry’s right to prognosticate and opine as long as he is not working for or in the securities business: and so he does, as editor and CEO of Business Insider, a business and analysis site.
Does this mean that the financial news media, a la CNBC, are compelled to give Mr. Blodget the airways and whatever mantle of credibility they have left to help him get his message out? I mean it is like background checks for firearm sales or disclaimers on the Jim Cramer’s advice. He could not pass a background test as an honest purveyor of investment research; and, at the least, a disclaimer should precede his guest shots. CNBC, however, never disappoints when it comes to low standards, so I was not surprised to see the “new, improved” edition of Blodget on “Street Signs”, sitting in on segment anchored by Maria Bartiromo (that paragon of financial wit and wisdom) and Tyler Mathison. For some viewers, not familiar with the nuances of the tech bust, Blodget’s appearance may not ring a bell, but for me all the alarms went off. It proved, once again that you cannot take these folks and their guests seriously when making decisions about your money. I ended my headline, “Henry Blodget, Alive, Well and Rehabilitated?”, with a question mark for good reason. You may get the picture from the attached link to a recent article from Salon.com about Mr. Blodget’s Bitcoin advice.
What do you think?
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