I'm not talking about the pretty-much-expected dive the markets took today... rather, I'm looking at the Supreme Court decision that came down today involving an attempt to extend a shareholder lawsuit against a cable company to the equipment suppliers that knowingly helped cook their books with fake transactions. SCOTUS sez that, since the suppliers in question didn't make any public financial statements about the worth of the cable company, they're off the hook from shareholder lawsuits (although the SEC could, if they were so inclined, levy fines and/or criminal charges).
Now mind you, it wouldn't have been tea and cakes in the business world if the court had ruled the other way, as already out-of-control lawsuits would have gotten kicked up a notch... but I'm seeing what looks like a gaping loophole because of this ruling (and I pray I'm missing something, I really do). Couldn't one set up a company whose sole purpose in life is, purportedly, to procure goods for another company... but really serves as a "dumping ground" for anything the main company wants to hide for a few months, sort of like kiting checks writ large? Heck, make it a privately-held company, just to limit the amount of snooping the SEC can do while you're at it.
All I know is that, while I will have to stick with the stock market (it's the only thing that can make any real income long-term), I'm not doing anything but ETFs anytime soon... that should limit the fallout from collapsing houses of cards, with any luck.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment