TheStreet.Com - Captured Journalist Heaven
One of the central themes of The Story of Deep Capture, Mark Mitchell’s epic work of media criticism, is that the staff of TheStreet.com is overwhelmingly beholden to the interests of a few criminal, short-selling hedge funds.
Herb Greenberg, Dan Calorusso, Dave Kansas, Jesse Eisenger: all launched their careers at TheStreet.com.
Such an ignominious list of alumni is matched only by the institution’s co-founder: Jim Cramer, and early investor: David Rocker (founder of Rocker Partners hedge fund).
There’s little doubt that TheStreet.com has been home to more than its fair share of captured journalists. What’s less clear is the matter of cause and effect: does the organization excel at breeding, or merely attracting such people?
Based on the example of former TheStreet.com writer Peter Eavis — contrasting what can be learned about him in the many documents recently made public in the lawsuit pitting Fairfax Financial against SAC Capital and several other hedge funds, with what he’s accomplished since — I’m inclined to believe that the dysfunction at TheStreet.com is a product of the toxic culture of the place, and that well-intended writers with talent who leave early enough have the capacity to redeem themselves.
Peter Eavis features prominently in several documents acquired through discovery in the Fairfax case. The earliest mention of him appears in an email dated July 10, 2002, in which John Hempton told Rocker employee Monty Montgomery “I have Peter interested” in his belief that Fairfax Financial was a fraud.
Later, short selling hedge fund manager Jim Chanos refers to Eavis as John Hempton’s “guy”.
On January 15, 2003, Eavis published his first column on Fairfax: Unsure times for insurer Fairfax Financial, making a special effort to attack the integrity and business acumen of Fairfax CEO Prem Watsa.
While the tone of that piece implies plenty about Eavis’s state of mind when he wrote it, somewhat more telling is the comment he uses to preface the article when sending it, just 20 minutes after publication, to Rocker hedge fund employees Marc Cohodes and Monty Montgomery:
“Watsa good old Canadian insurer to do?”
One month later, Eavis publishes Fairfax Tirade Can’t Obscure Sea of Red, comparing Prem Watsa to, among other things, a wounded animal.
Less than 20 minutes later, Eavis sends the column to Montgomery and Cohodes, prefaced by:
“Prem gets nasty.”
Exactly one month later, it was Eavis again, with Fairfax’s Buffett Pose Falls Short, which he again promptly sent to Montgomery and Cohodes, this time commenting:
“Imitation gives way to evisceration.”
On April 3, 2003, Eavis is back on the attack, with Fairfax Walks the High Wire on Rates, which he also wastes no time in sending Montgomery and Cohodes, noting:
“Prem in the bunker.”
One month and two days later, Eavis writes Fairfax Fog Only Thickens, calling the company “beleaguered” despite its having just announced first quarter earnings of $10.60 per share. Eavis claims he offered Fairfax an opportunity to respond, but that the company “didn’t immediately return a call seeking comment.”
The lack of a prompt return call might have been a result of the fact that Eavis filed his column at 7:10am EDT.
While Fairfax employees likely were not in the office at that early hour, we know Eavis was, as he emailed the column to Montgomery and Cohodes within six minutes, prefaced by:
“More on the anti-Buffett.”
Finally, on May 15, 2003, we see the most telling email exchange of all, this time following Eavis’s column Fairfax Is Banking on the Luck of the Irish.
In stark contrast with the victorious tone of the emails alerting Montgomery and Cohodes to his four earlier columns, Eavis is sheepish when announcing this latest, saying:
“Two numerical errors in the first version, so I’m re-sending this. The mistakes made Fairfax look better than it should. A link to the corrections can be found at the bottom of the piece. Apologies.”
Hey, Peter…even the best reporters make mistakes. That’s why pencils have erasers, as they say, and why publications have “Corrections and Clarifications” sections. If you owe anybody an apology, it’s your readers, which was taken care of in the body of the correction itself.
And yet, Eavis apparently felt apologies were also due Rocker Partners hedge fund, where an anticipated payday depended upon Fairfax looking as bad as possible.
Why on earth would Eavis feel such a debt to Rocker?
A little less than an hour later, Monty Montgomery replied, writing:
December 18th, 2008 by Judd Bagley
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Below is a partial repost of my blog pertaining to Fairfax Financial published on 12/17/08 to fill in some of the background. There is also link to the Fairfax lawsuit.
Canadian Company Fairfax Financial Attacked From Down Under
Judd Bagley is hot on the trail of the Wall Street crooks. He has over 1000 pages of discovery documents from the Canadian company Fairfax Financial lawsuit against "the enterprise" that set out to destroy the company.
We just got another early Christmas present with this Deep Capture post by Judd.
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December 17th, 2008 by Judd Bagley
While an examination of the recently-unsealed products of discovery in the Fairfax Financial (NYSE:FFH) vs. SAC Capital, el al, lawsuit reveals the extensive involvement of most all the usual players — both in the world of hedge funds and business journalism — one name, mostly unknown to those outside Fairfax circles, appears quite prominently: John Hempton of Sydney Australia.
Hempton, it appears, conceived of and initially orchestrated the entire Fairfax fiasco. At the time, he was a senior analyst at Australia’s Platinum Asset Management hedge fund. Last year he left Platinum to join Global Value Investors, though on May 15 of this year, Hempton started a blog and began calling himself semi-retired; leading me to presume that some time in early May, Hempton and GIV parted ways.
Though possibly mere coincidence, Herb Greenberg abandoned his MarketWatch gig on May 1, 2008 while Bethany McLean announced her departure from Fortune three days later. Greenberg and McLean, as it turns out, both play notable roles in the apparent Hempton-inspired conspiracy.
A reading of Hempton’s early efforts to win converts to his thesis that Fairfax was a ticking time bomb waiting to implode suggests his conclusions were based on what he viewed as sound principles; he really was convinced, and composed multiple, lengthy missives outlining his reasoning. I suspect Hempton’s mistake was then convincing some of the worst people on Wall Street, whose methods fill the pages of this blog, and whose influence probably turned his project from a speculative to a criminal enterprise, dragging Hempton down with it.
That’s not to say that any of this absolves Hempton of blame.
For one, a 2002 email sent to Rocker Partners employee Monty Montgomery makes it clear that Hempton is prominent stock message board poster Brolgaboy (and brolgaboy1 on Yahoo Finance).
I asked Hempton to comment on or clarify this email, but he refused.
That may be because he knows that, thanks to the Yahoo Dissembler Sorting Algorithm bug, it’s possible to know with certainty that in addition to brolgaboy1, Hempton is also Yahoo posters jamiewoodford1, scudzy_short, zipperdydoodah, and (my favorite) mr_byrnes_sith_lord.
Between them, these accounts have many hundreds of posts on Yahoo Finance, to say nothing of the hundreds more posted to several other boards.
Here’s where I really begin to lose patience with John Hempton.
On August 15, 2005, Hempton created and began posting taunting messages under the name mr_byrnes_sith_lord. This was three days after DeepCapture.com contributor and Overstock.com CEO Patrick Byrne announced a lawsuit against Gradient Analytics and Rocker Partners hedge fund for conspiring to get rich by destroying his company. At that time, Byrne further announced that he had evidence of a central figure — whom Byrne metaphorically compared to the shadowy “Sith Lord” of the Star Wars series — coordinating these attacks in ways nobody had previously considered possible.
AntiSocialMedia with Judd Bagley
Analysis of the abuse of social media — blogs, Wikipedia, message boards, etc — for the purpose of enabling illegal stock market manipulation.
Posted in AntiSocialMedia with Judd Bagley
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You can read the entire Fairfax Financial Lawsuit here.
Rocker Partners has been dropped from the suit but can be brought back in. (see Liquidity Thy Name Is Madoff — Full Court Captured Press & SEC by RoryKearney | December 17, 2008 at 05:26 am 751 views, for more on Rocker Partners and the Fairfax lawsuit http://my.nowpublic.com/tech-biz/liquidity-thy-name-madoff-full-court-captured-press-sec-0
FAIRFAX News Release Stock Symbol: FFH.SV (TSX); FFH (NYSE)
TORONTO, July 26, 2006
FAIRFAX ANNOUNCES FILING OF LAWSUIT
ALLEGING STOCK MANIPULATION
Fairfax Financial Holdings Limited announces that today it filed a lawsuit seeking $5 billion in damages from a number of defendants who, the complaint alleges, participated in a stock market manipulation scheme involving Fairfax shares.
The complaint, filed in Superior Court, Morris County, New Jersey, alleges violations of various state laws, including the New Jersey Racketeer Influenced and Corrupt Organizations Act (RICO), pursuant to which treble damages may be available. Defendants include: S.A.C. Capital Management, LLC, S.A.C. Capital Advisors, LLC, S.A.C. Capital Associates, LLC, S.A.C. Healthco Funds, LLC, Sigma Capital Management, LLC, Steven A. Cohen, Exis Capital Management, Inc., Exis Capital, LLC, Exis Differential Partners, L.P., Exis Integrated Partners, L.P., Adam D. Sender, Spyro Contogouris, Max Bernstein, Andrew Heller, Lone Pine Capital, LLC, Lone Pine Members, LLC, Lone Pine Associates, LLC, Rocker Partners, L.P., Copper River Partners, L.P., David Rocker, Third Point LLC, Daniel S. Loeb, Jeffrey Perry, Trinity Capital Of Jacksonville, Inc., Trinity Fund, Ltd., Morgan Keegan & Company, Inc., John D. Gwynn, and Christopher Brett Lawless. Fairfax Financial Holdings Limited is a financial services holding company which, through its subsidiaries, is engaged in property and casualty insurance and reinsurance, investment management and insurance claims management.
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The sordid tale of the hedge funds ill conceived plan to destroy Canadian Company Fairfax Financial Holdings (FFH)
Re: Hedge Fund Hit Man Hired by Cohen,Loeb,Sender Says Insurer Bloomberg.com
``Dear Father,'' the note begins. ``The attached documents are being sent to you out of my concern for the Church's finances.''
``I am perplexed by the mystifying, spectacular rise of this insurance medusa,'' the typed letter reads. ``Be aware, Father, be skeptical and ask Mr. Watsa to make a full confession.'' The note was signed P. Fate. The return address was that of St. Patrick's Cathedral in New York.
Stranger still is what Fairfax says is the source of the letter: A cabal of hedge fund managers -- among them James Chanos, Steven Cohen, Daniel Loeb, David Rocker and Adam Sender -- hoping to profit from a slump in Fairfax stock. Fairfax, which has a history of accounting lapses, sued eight hedge fund firms for racketeering in July 2006, demanding $6 billion in damages.
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I will repost this snippet from Judd Bagley's exposé on the plot to destroy Fairfax http://www.deepcapture.com/bethany-mclean/ for those who missed it.
Rather, the early Christmas that arrived for me in the form of about 1,000 pages of discovery just unsealed in the Fairfax Financial (NYSE:FFH) vs. SAC Capital, et al, lawsuit, in which Fairfax claims a conspiracy (or “Enterprise” as it is termed in the suit) involving multiple short-selling hedge funds, financial analysts and business journalists intent on destroying the company for monetary gain.
Included in this mass of documents are hundreds of emails and instant message transcripts between hedge fund managers, their operatives and such “journalists” as Bethany McLean, Herb Greenberg, and Roddy Boyd.
Almost without exception, each of these is immensely useful in understanding how these folks all relate to each other. But among them all, the most revealing — to say nothing of damning — are those between Bethany McLean, then of Fortune, and the upstanding folks at hedge fund Copper River Management.
From: Marc Cohodes
Sent: Thursday, December 7, 2006 3:21:12 PM
To: Bethany McLean
FFH is the Canadian Enron and it could even be worse…We are sending you stufff.. I suggest since [Copper River employee and former SEC attorney Richard] Sauer is on the East Coast (for now) that you 2 meet, and soon… there is an “enterprise” here and he can lay it out clear as day.
It bears noting that, according to filings in the Fairfax suit, the various participants in the attack on Fairfax stock referred to their effort collectively as “the Enterprise”. Whether or not this is what Cohodes was alluding to when using the term — which might not otherwise belong within quote marks in this context — is not clear, but certainly suggestive.
From: Bethany McLean
Sent: Thursday, December 7, 2006 3:48:43 PM
To: Marc Cohodes
Subject: Re: ffh
Makes sense. Send me whatever you can think of - the more documents the better Without Cohodes offering a bit of proof to back his Enron/Fairfax comparison, McLean finds it “makes sense” and commits to move ahead.
From: Marc Cohodes
Sent: Thursday, December 7, 2006 3:51:37 PM
To: Bethany McLean
Subject: Re: ffh
don’t you worry…where do you want the stuff fed-exed to… I would set up a time for Sauer to come and see ya.. His code name is “Lavaman”…
Cohodes then forwards this exchange to employee Rick Sauer, who schedules a meeting between himself and an unusually eager McLean, set for one week thence.
The outcome of that process was McLean’s scathing March 6, 2007 Fortune piece: The inside story of a Wall Street battle royal.
How can I be certain that this particular story was the direct result of the Cohodes’s efforts? The answer to that question is where the situation becomes particularly disturbing…sufficient to leave me feeling physically ill, and prepared to officially add Bethany McLean to the short but distinguished list of truly captured and corrupt journalists.
read on here http://www.deepcapture.com/bethany-mclean/
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No blog on thestreet.com is complete without the following:
Video of Cramer throwing his United States subpoena on the floor on national tv
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Here Cramer gets the I-Tulip award for being the biggest liar on Wall Street.
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The Winners of the New World
By James J. Cramer
2/29/00 9:42 AM ET
“You want winners? You want me to put my Cramer Berkowitz hedge fund hat on and just discuss what my fund is buying today to try to make money tomorrow and the next day and the next? You want my top 10 stocks for who is going to make it in the New World? You know what? I am going to give them to you. Right here. Right now.
OK. Here goes. Write them down — no handouts here!: 724 Solutions (SVNX:Nasdaq - news), Ariba (ARBA:Nasdaq - news), Digital Island (ISLD:Nasdaq - news), Exodus (EXDS:Nasdaq - news), InfoSpace.com (INSP:Nasdaq - news), Inktomi (INKT:Nasdaq - news), Mercury Interactive (MERQ:Nasdaq - news), Sonera (SNRA:Nasdaq - news), VeriSign (VRSN:Nasdaq - news) and Veritas Software (VRTS:Nasdaq - news).
We are buying some of every one of these this morning as I give this speech. We buy them every day, particularly if they are down, which, no surprise given what they do, is very rare. And we will keep doing so until this period is over — and it is very far from ending. Heck, people are just learning these stories on Wall Street, and the more they come to learn, the more they love and own! Most of these companies don’t even have earnings per share, so we won’t have to be constrained by that methodology for quarters to come.
We try to own every one of them. Every single one. And if I had my druthers, I wouldn’t own any other stocks in the year 2000. Because these are the only ones worth owning right now in this extremely difficult, extremely narrow stock market. They are the only ones that are going higher consistently in good days and bad. I love every one of them, just as I loathe the rest of the stock universe.
How did this stock market get like this, to where the only people who can make a dime in it are the people who are interested in the most arcane subject, the moving of data from one space to another, via strange new machines and software? How did it get to the point where nothing else matters, most particularly the 90% of the stock market I have studied for the last 20 years? How did all of that knowledge become totally irrelevant and the only stocks that work are the stocks of companies that didn’t exist five years ago and came public in the last two or three years?
A-ha, that just leaves us with tech. That’s why we keep coming back to it. That’s why, despite the 80% increase in the Nasdaq last year, we are looking at another record year now. It is by that process of elimination that I have picked my top 10. And my next 10 and my next 10 after. Only those companies are worth owning. The rest?
You can have them.
James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund was long 724 Solutions, Ariba, Exodus, Digital Island, InfoSpace, Inktomi, Mercury Interactive, Sonera, VeriSign, Veritas Software, Oracle, TheStreet.com, Vignette, Motorola, Cisco, Intel, Nokia, Goldman Sachs, and Yahoo!, and Cramer was long TheStreet.com. His fund often buys and sells securities that are the subject of his columns, both before and after the columns are published, and the positions that his fund takes may change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer’s writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column at email@example.com.
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Whenever Jim Cramer's name comes up I have an overwhelming urge to yell at him. While our CareToLive members are dying, here are the lies Cramer told about Provenge, Dendreon's immunotherapy for late stage prostate cancer.
Here are the lies Cramer told about Dendreon's Provenge.
Cramer lies about Dendreon on CNBC. He said Provenge failed FDA approval. Provenge wasn't up for approval until 5/15/07.
Mark Haines of CNBC apologizes on the morning show, Squawk Box, for Cramer's error.
Cramer later that night apologized but then went on to lie by saying the problem with Provenge was survival. Survival was the reason the FDA called for an Advisory Committee.
Cramer's degrading rant on Monday's show, 9/26/05, was right before Dendreon's CEO was presenting at UBS. It is important to note that UBS is the only company that downgraded Dendreon, not once, but four times in 12 months after Dendreon reported good steps of progress.
And then Mr. Cramer went into a disgusting berating of us shareholders, calling us drunken, carousing, gambling Falstaffs. He called Dendreon a battleground stock. "Dendreon investors might as well take their money to Vegas."
Cramer talks about the Games Hedge Funds Play. He talks about the amount of money it takes to drive down a stock, he talks about lying and fomenting to hurt a stock, especially if the company reports good news.
The night before the Provenge advisory panel hearing Cramer yells, "Sell, sell, sell!"
3/29/07 After the good panel vote Cramer said he confused it with the fictional drug from a 1993 movie, "The Fugitive," in which Dr. Richard Kimble, played by Harrison Ford, tries to expose a fictitious pharmaceutical company, Devlin-MacGregor.
Cramer said in a video this afternoon on TheStreet.com that this Dendreon (DNDN-NASDAQ) is a classic case of short sellers not covering themselves by not buying calls with the strikes above. Cramer said there are some short sellers who lost their year on DNDN.
11/2/07 "I got into so much trouble with Dendreon once. ... Dendreon is just a failed biotech that I want nothing to do with." He made another Devlin-MacGregor reference. http://www.thestreet.com/s/cramers-mad-money-lightning-round-hop-into-ford/funds/lightninground/10388222_2.html 7/9/08
Cramer calls Dendreon a dog.
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Almost 60,000 American men have died of prostate cancer without the benefit of access to a safe and effective immunotherapy, the FDA's own Advisory committee voted 17-0 safe and 13-4 substantial evidence of efficacy, and then delayed by a corrupt FDA, Wall Street and Pharmaceutical industry. Profits in the cancer industry are wagging the dog.
We just wrote another journalist, Mike Huckman of CNBC, again, for the umpteenth thousandth time to try to get them to tell the Provenge story. After all, nobody died in the Madoff debacle. 60,000 Americans gone without the benefit of treatment. We have lost 3 members at Care To Live http://www.CareToLive.com , and have several member desperate for this non toxic, non invasive treatment for late stage prostate cancer, who are out of options.
COME ON MEDIA. EXPOSE THE FDA. INTERVIEW THE CROOKS AT THE FDA. TELL THE PUBLIC! LET'S GET ANGRY!
Think it doesn't affect you. It affects EVERYBODY. 1 in 6 men get prostate cancer in their lifetime. http://youtube.com/watch?v=6Q0uQAL_YDA Video of Care To Live member Ted Girgus taken at our nationwide protest in Seattle. Ted has stage IV prostate cancer, that has metastacized to his bones. Ted and his doctor, want him on Provenge NOW! Ted is a kind and very loving man. We want him around for years to come.
To Catch A Rat — Illegal Rumor Mongering at its Lousiest
Video of the 2007 Rally http://www.youtube.com/watch?v=UqAx7uZAS90
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Apparently Wall Street "knew" years ago, long before Dendreon's Provenge went through its trials, that "it doesn't work".
The Hedge Fund Whisperer (I wonder which Wall Street crooks did it)
The whisper that started the rumor that launched 50 million naked shorts.
Let's not forget this beauty by Huckman from his article below.
"I remember sitting at a table at a rare Dendreon analyst meeting a few years ago and someone from a Connecticut hedge fund leaned over and whispered in my ear "It (Provenge) doesn't work." "
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