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Thread: Scott moritz guilty of fomenting?

  1. #1
    Sirius Roadkill is offline
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    Scott moritz guilty of fomenting?

    According to Scott Moritz' employer at the Street, quote:

    "A lot of times when I was short at my hedge fund—meaning I needed [the market to go] down—I would create a level of activity before [the market opened] that could drive the [pre-market] futures [down]. … Similarly, if I were long, and I wanted to make things a little bit rosy, I would go in and [buy] a bunch of stocks and make sure that they were higher …

    It's a fun game, and it's a lucrative game. You can move [the market] up and then fade it—that often creates a very negative feel. … That's a strategy very worth doing. … I would encourage anyone in the hedge fund game to do it. Because it's legal. And it is a very quick way to make money. And very satisfying."


    Mr. Moritz' employer further states:

    "[Y]ou've really got to control the market. You can't let it lift. When you get a [bellwether stock that is soaring like] Research in Motion, it's really important to use a lot of your firepower to knock that down. … So, let's say I were short. What I would do is hit a lot of guys with RIMM [sell a lot of Research in Motion stock to a lot of investors]. "


    Additionally, Mr. Moritz' employer says this about fomenting:

    "Now, you can't "foment." That's a violation. You can't create yourself an impression that a stock's down. But you do it anyway, because the SEC doesn't understand it. [my emphasis]. That's the only sense that I would say this is illegal. But a hedge fund that's not up a lot [this late in the year] really has to do a lot now to save itself.

    This is different from what I was talking about at the beginning where I was talking about buying the QQQs and stuff. This is actually blatantly illegal. But when you have six days and your company may be in doubt because you're down, I think it's really important to foment—if I were one of these guys—foment an impression that Research in Motion isn't any good. Because Research in Motion is the key today."


    and finally, here's what the FCC says:

    According to the SEC's Web site, market "manipulation" is:

    intentional conduct designed to deceive investors by controlling or artificially affecting the market for a security. Manipulation can involve a number of techniques ... [such as] spreading false or misleading information about a company … or rigging quotes, prices or trades to create a false or deceptive picture of the demand for a security. Those found guilty of manipulation are subject to criminal and civil penalties.

  2. #2
    Sirius Roadkill is offline
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    can't get enough Scott Moritz??

    neither can I . . . check this out, by Daniel Eran Dilger from "RoughlyDrafted" magazine:

    "The iPhone’s launch was regarded as the most blockbuster for any consumer electronics device ever. Yet Scott Moritz published a Street report saying that it had ”missed a 1 million unit sales target and rivals are rejoicing.“ Moritz wasn’t just inventing something to say to get airplay. He was seeding false information to manipulate Apple’s stock price downward.

    His report was purportedly based upon inside ”whispers,“ but the reality was that he misrepresented the position of analysts covering the iPhone.

    He conveniently failed to point that analysts had really set targets between 150,000 and 300,000; during the launch, some raised their estimates for the weekend to twice that. None had ever set a million units as a realistic goal, let alone a minimum threshold of failure. Moritz clearly lied."

    "Moritz subsequently announced that Apple was earning fantastical profits on the iPhone from its revenue sharing plan with AT&T and insisted that the deal was unprecedented. This wasn’t true, as RIM also quite publicly earns a revenue cut from service providers. Moritz then issued a sudden warning–falsely attributed to an investment group that doesn’t even cover Apple or tech stocks–that Apple was cutting its orders with suppliers in half.

    These continual cycles of false reports tug investors up and down in short term manipulations. Even worse, they serve as protofacts for junk science journalists piecing together theories that otherwise have no support apart from the ramblings of those who are intentionally seeding false information, either for their own benefit, for that of their clients, or a bit a both."

  3. #3
    Sirius Roadkill is offline
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    Just in case you want to shake Scott's hand for his fine reporting or maybe ask for an autograph, here's what he looks like:



    kinda has that Henry Paulson/Goldman Sachs style look
    Last edited by Sirius Roadkill; 10-03-2009 at 12:18 AM.

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    Sirius Roadkill is offline
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    here's some more on Moritz from "RD Magazine"

    Great Job With the Consistently Wrong Coverage.

    In a video published by the Street, Cramer praised Moritz for his coverage of Apple, which included his story of ”speculation“ that Apple was cutting its iPhone orders in half. When asked for details, Moritz described the story as coming from a ”boutique research shop“ but also conceded that ”it doesn’t make much sense.“

    The nonsensical story said that Apple pre-ordered 9 million phones but then canceled half its order. Apple doesn’t maintain a year of channel inventory for any of its products. The Street invented this. Moritz claimed to be reporting the reasons why Apple’s stock dipped down, but his fake reports are the reason. Cramer even credited his reports as ”self fulfilling.“

    When asked about over the top reports complaining about the iPhone’s battery needing replacement in two years, Moritz also had to concede ”I’m not sure it’s an issue.“

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    Sirius Roadkill is offline
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    from "iphoney"

    "Moritz claimed that iPhone sales targets were missed on its opening weekend:

    The sales goal — or so-called whisper number — both internally at Apple and on Wall Street was a nice round 1 million phones.

    The problem is, Moritz doesn’t give a source for that “whisper number”, and all sales predictions I’ve found have been well under one million phones for the opening weekend. From Bloomberg we have these pre-iDay projections (emphasis added):

    Shoppers may have bought as many as 700,000 units over the weekend, according to David Bailey, a Goldman Sachs analyst, twice his projection of 350,000.

    Gene Munster, a Piper Jaffray analyst, said shoppers had bought as many as 500,000 units over the weekend, more than twice his projection of 200,000.

    And Bill Shope, a J.P. Morgan Securities analyst, estimated sales at 312,000. Before the phone’s debut Friday, analysts expected Apple to sell 50,000 to 200,000 units.

    Pacific Crest Securities projected sales of 400,000 units over opening weekend.

    Furthermore, Moritz himself didn’t think there were even a half a million units available in brick and mortar Apple or AT&T stores on opening weekend:

    So with 1,962 stores and let’s say 200 phones per store, Apple stands to sell some 392,000 iPhones

    Maybe he thought online sales were going to account for 600,000 units, but that seems doubtful. And if he knew about predictions of one million sales for opening weekend, that probably would have been worth mentioning along with his calculations. It would be nice to know who exactly whispered “one million” to him, because for the moment that number doesn’t seem to have been whispered to anyone else."

  8. #8
    Sirius Roadkill is offline
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    btw . . there's a lot more Moritz stuff out there (as if this isn't enough) but I think I will hold-off posting anymore today so that I can post in daily dribs and drabs over the next several weeks in order to get maximum impact . .
    Last edited by Sirius Roadkill; 10-03-2009 at 12:18 AM.

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    relmor2003 is offline
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    Great work Roadkill. I appreciate your efforts here. Maybe Tyler will let you throw all this together and you can write an article about it. I think that would be a great idea.

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    Sirius Roadkill is offline
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    Quote Originally Posted by relmor2003 View Post
    Great work Roadkill. I appreciate your efforts here. Maybe Tyler will let you throw all this together and you can write an article about it. I think that would be a great idea.
    Hey Relmor . . Thanks for the props!

    The stuff on this guy will drip out like a leaky faucet . . I may even start-up a Scott Moritz Daily Intraday Thread just to have a central clearing house for all of the information I have already compiled but not yet published.

    The problem with becoming an author is that you subject yourself, and the site's owners, to libel complaints which are costly to defend even if they are without merit . . .

    Much better, and more effective, to just remain a concerned member of the community with one man's opinion based on a series of facts . . . as an individual blogger, the case law is still in our favor!

    But Tyler or anyone else connected with this site is welcome to use my thread as a data base for compiling an article on the topic . . in the meantime, I may have uncovered a very interesting conflict of interest that I will need to do some more due diligence on . .

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