A piece of Orwellian obfuscation by one Tom Sykes at Daily Kos *(see note at the bottom of this post) goes into the file, rip-roaring propaganda:
“I want to be clear on something up front. I think hedge-funds are a menace and should be outlawed. I think Goldman Sachs is a criminal conspiracy and its whole leadership should be indicted.
There are plenty of commentators, like Paul Krugman in the New York Times today and Matt Taibbi in his article in Rolling Stone, that have done great reporting on Goldman and on hedge funds.
But what we’re seeing is how a really odious character named Patrick Byrne is trying to hijack this issue…”
My Comment:
Byrne hijacked Taibbi? The liberals busted Goldman Sachs and naked short-selling and the hedge funds?
Aren’t Goldman Sachs and the hedge-funds the money men who funded the whole left-establishment..and wasn’t it people on the right libertarian side who busted them, and in fact called the whole financial crisis?
The libs were on the case only in 2008 when everyone was on the case and you’d have to have been blind not to notice.
This kind of revisionism makes me question the impetus behind the Rip Van Winkle awakening of the MSM on the financial crisis.
Either it shows that the MSM can’t see what’s going on in front of its collective nose, which argues that its working hypotheses are wrong (the kinder interpretation), or it shows rank dishonesty (the truer interpretation, likely).
I’d go with the first interpretation, only the hatchet job the press keeps doing on anyone from the other side of the political spectrum suggests that the second interpretation is the right one.
As I’ve repeated ad nauseum, Taibbi seems to have lifted my Goldman Sachs piece of 2006 (Money Week) as well as a bunch of other articles written in 2007-2008 (see ABOUT) . You can read it on the net and then go back and see what Taibbi wrote, only about three years after I did. (He probably pinched stuff from at least one other person as well). You will also see that I wrote more than half-a-dozen articles on Goldman after that in 2006 and 2007 (check this site). In 2008, everyone began writing about Goldman. I figure someone at Rolling Stone got worried that the population was beginning to wake up to which side really had the goods, and decided to co-opt the issue before their intellectual ineptness was too evident.
Otherwise, I’m hard pressed to explain why they don’t think they need to source and attribute correctly. They can’t all be such intellectual charlatans? Right?
As for naked short selling, Byrne has been waging that campaign since 2005.…and some others on the right, even before him. Even people who don’t think there’s an NSS hedge-fund-media conspiracy involved have long ago conceded that NSS is a problem (see this Motley Fool piece from 2005), and that it’s difficult to figure out what’s really going on, because the DTC/SEC, for example, won’t/can’t release the figures needed to assess the situation.
(Now, why would anyone think conspiracy when there’s stone-walling going on…)
Matt Taibbi basically borrowed Byrne’s argument. And having taken the argument, the establishment is now trying to discredit the person who made it first (see Ritholtz here and here, even before the Facebook brouhaha).
It’s not irrelevant that in coming to his conclusions, Ritholtz cites only the very same journalists whose credibility is shot by the evidence of their collusion with hedge-funds. That is certainly a bizarre way to report on a topic.
Mind you, this should not be taken to be an endorsement on my part of Byrne’s business practices or accounting, about which I know only what I have read. And that of course has mostly been written by his critics and critics of the NSS thesis, like Dow Jones reporter, Carol Remond.
But Remond, despite her reputation as a respected reporter on penny-stock scams, is seriously compromised in her reporting on this issue because of alleged collusion with hedge funds.
I say alleged, to be on the safe side, but to my eyes the evidence is convincing.
On the other hand, Overstock has repeated accounting problems that its foes argue are the real reason for its NSS campaign.
How serious these problems are is hard to say.
Of the two accountants who routinely denounce Byrne’s business practices in multiple postings that take up a remarkably (and suggestively) disproportionate space on their blogs, one, Sam Antar, has been convicted of one of the most extensive cases of embezzlement in recent history. Antar also claims the mantle of reformed felon without any evidence that restitution of the embezzled funds took place. He escaped prosecution only by turning in his own family. This is not a confidence-builder. Actually, there’s some evidence of further wrong-doing involving one Barry Minkow that’s also posted on the Deep Capture blog. Antar and Mankiw are practicing greenmail, according to this piece.
(Its author uses the term loosely. Greenmail, in recent US financial history, is what Michael Milken is infamous for – a type of corporate raid. And Milken is one of the central villains in the Deep Capture story of the corruption of Wall Street. Since I researched this period for a book I was planning to write on Goldman Sachs, I’m conversant enough with the subject to say with some confidence that Byrne is on the right track on this).
The other accountant who criticizes Byrne, Tracy Coenan, seems to be another ally of Antar and equally over- concerned with the accounting problems of Overstock, to the neglect of other companies.
Yet these are the only two accounting experts I see cited by Weiss.
Could there be other things wrong with Overstock?
Perhaps.
I have no way of knowing. But what I do know doesn’t so far make me think the problems are related in any way to the thesis of Deep Capture. The accounting errors don’t seem especially egregious, compared to the rest of what is going on in the market that the reform movement that Byrne spearheads is trying to tackle.
So is Deep Capture’s work discredited because of Byrne’s alleged and real problems?
No.
Overstock could very well be mismanaged and Byrne could be guilty of accounting shenanigans. That has nothing whatsoever to do with the extensive, indeed, mind-boggling, ties between supposedly neutral financial reporters and the hedge-funds that Deep Capture report on. The evidence the site has collected is shocking and undercuts any defense of the neutrality of the reporters in question (Bethany McLean, Remond, Weiss, Herb Greenberg, Roddy Boyd, etc).
To return to the media manipulation story.
After Taibbi put the two stories on Rolling Stone, Goldman and Penson came out and shot them down.
Taibbi, strangely, for a supposed target of Goldman and for all his righteous indignation over NSS, vanishes on the latter subject (NSS) and retracts parts of the former.
So what happens?
The entire Goldman argument gets reduced to “Goldman corrupted the regulators,” which works very well if you want more government and more regulators (and we are not fundamentalists on either subject). The good part of that from the point of view of the MSM is that that lets them displace the outrage on one or two figures (Rubin, for example), while using GS as a whipping-boy to funnel off popular rage from any effective overhaul/criminal prosecution, as well as to deflect it from the evidence of conspiratorial criminal activity.
(Yes, there are conspiracies, Virginia, and often the ones protesting loudly that they don’t exist are part of them…unwittingly or not).
Take this piece at Business Insider by Ritholtz, which sets up the boundaries of establishment discourse, with Taibbi and Gasparino at either end. What it does is to come down roughly “midway” between the two in a way that conveniently does nothing to change the centrist liberal establishment discourse.
(At least, that’s my take).
Now, Taibbi comes from a well-established media background, with a father who was an NBC TV man.
It’s hard to believe he doesn’t know the ethics and etiquette of sourcing. In fact, it’s downright impossible.
We’d have to conclude that
1. He was tasked with co-opting the stories for political or national security reasons.
2. Or lacks journalistic integrity, a deficiency fairly rampant these days….
3. Or wants to protect the left-liberal establishment on the issue….
4. Or some combination of the above.
Note:
*Tom Sykes is apparently a sock-puppet created by Gary Weiss, the former Forbes and Business Week reporter, at least, according to the considerable evidence amassed at Deep Capture.
Note: I have sent several mob/corruption-related articles to the Deep Capture team and consider myself a supporter of their research, which I’ve tried to link and forward to others, as well as to more generally publicize. I don’t think that prevents me from assessing the merits of their claims objectively. I don’t, for example, condone any social engineering attacks on social media sites like facebook, no matter what the legal status of such attacks is. Frankly, the work Deep Capture is doing on market/media corruption is too important for its members to get into such unworthy activities. Nor do I think bringing in personalities, family members, or even private networks of journalists is particularly important or even necessary. The point is not whether a journalist talks to or is friendly with another journalist….or even hedge-fund. The point is whether their work is significantly biased by the friendship and whether they disclose the friendship and attempt to correct for it. I appreciate a number of left and liberal writers, even when I disagree with them, because I find them intellectually honest and reasonably objective (complete objectivity being impossible as well as unnecessary). That’s not a very high standard to demand now, is it?