Fuchs: I'm not that bothered by Cuban's actions
Marek Fuchs, the Business Press Maven for TheStreet.com, writes Saturday that the recent actions by billionaire Mark Cuban to short a stock before publication of an article about the company on the business journalism web site ShareSleuth.com doesn’t bother him as much as it has bothered other critics.
Fuchs writes, “The Business Press Maven believes that the only downside to this practice is that it allows the targeted company to, as Xethanol did, cast doubt on Cuban’s motives by implying that he is part of some shorting conspiracy.
“Though The Business Press Maven has never written about a stock he owned (and would disclose if he did — fight authority and it always wins), I am not comforted by the fact that it is considered a conflict of interest in most circumstances for a writer to own a stock he writes about.
“In short, nothing convinces me of conviction more than ownership (or, in Cuban’s case with shorting, borrower-ship.) The conventional knock on a journalist owning a stock they write about is that they won’t be as fair and open-minded about the stock’s faults. But to be a good stock trader, one has to be unemotional, open to a company’s potential faults. Why can’t the traits co-exist? The key, of course, is that the writer does not turn publication into an opportunity to dump the stock — but if he is open about what he has bought and sold, and when and if authorities incarcerate those who lie, it seems that the reader would gain.
“Having worked on both Wall Street and in journalism, the biggest fault I see in journalism is that they have no real-world experience with Wall Street. This is only compounded in giving journalists, effectively — an out. Not only do you not have to put your convictions to the true test, we won’t let you. Instead, they round up quotes from people who have biases anyway.
“By the way: I have never been short Xethanol — but boy do I wish I had been.”
Read more here.
By the way, to all of the people who have e-mailed (all three of you) to ask my opinion about ShareSleuth and Cuban, I have given my opinion to a business journalist currently working on a story about the issue and will post those comments when that story is published.