View Full Version : Save Martha, WTF???
To: The President of the United States
Dear Mr. President:
A terrible injustice has been done to Martha
Stewart. Her only real crime was to be too successful,
thereby eliciting the enmity of misguided and misinformed
citizens who feel that she represents the face of corporate crime.
It is our belief, Mr. President, that Martha Stewart
was put on trial and aggressively prosecuted in a
criminal court because of who she is. Please allow us
to explain. ...
Full story (http://www.savemartha.com/)
11-24-2004, 11:27 AM
Martha Stewart is one of my least favorite people. But, more because of her reputation for abusing her employees and neighbors than anything she's done wrong in the stock market.
In fact the inside information that got her in so much trouble with the SEC only saved her about $45,000. But the negative impact of an ongoing SEC criminal investigation ended up costing her tens of millions of dollars in lost share value in her own company as well as the permanent loss of her position as head of that organization. In the end I'm not at all sure that the punishment fit the crime.
Here's an interesting article reflecting the opinion that she was unfairly singled out for prosecution:
Why Martha Stewart should go to heaven and the SEC should go to hell. (http://www.reason.com/0310/fe.mm.st.shtml)
11-24-2004, 03:14 PM
Even if someone was unfairly singled out, doesn't mean they should not be prosecuted. Kind of like, "Well he was doing it too". Not really a defense as well as irrelevant.
11-24-2004, 03:33 PM
[ QUOTE ]
Even if someone was unfairly singled out, doesn't mean they should not be prosecuted. Kind of like, "Well he was doing it too". Not really a defense as well as irrelevant. <hr /></blockquote>
What's not irrelevant is that trading on inside information is rampant on Wall Street. In fact I firmly believe that it's what drives the market. If you watch the stock market closely (minute to minute real time) you will clearly see a trading pattern emerge that confirms this. A given stock will start to rise (or fall) hours (sometimes longer) before news is finally released to the public. This happens over and over because news gets out before the public is informed. One of the common sayings amongst traders is: "Buy on rumor - sell on news". That's because over and over again, by the time news is released its impact is already built into the price of the stock.
What Martha did was dead wrong and she's paying a heavy price for it. But the fact remains that massive trading on inside information goes on day in and day out in the stock market and no one lifts a finger to do anything about it - least of all the SEC. Unless of course they can single out a high profile subject like Martha and make an example out of her.
Personal opinion? The example is meant to scare the little guy into behaving himself while the big boys keep raking in the dough unmolested - same as it ever was.
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