There’s so much going on this morning, that it’s hard to know where to focus one’s attention. There’s the rescue of Fannie and Freddie, the deal for Anheuser-Busch (BUD) and yet another Powerpoint in the ongoing Yahoo (YHOO), Microsoft (MSFT) and Carl Icahn saga.
But at times like this, it’s always good to stick to our knitting. So we’ll focus on this press release the SEC put out at noon yesterday. The takeaway was that the SEC was concerned with the intentional spreading of false rumors and appear to be aimed at broker dealers and investment advisers. Yesterday’s release also noted that both FINRA and the NYSE were joining together to deal with the false rumors.
—The examinations we are undertaking with FINRA and NYSE Regulation are aimed at ensuring that investors continue to get reliable, accurate information about public companies in the marketplace, said SEC Chairman Christopher Cox. —They will also provide an opportunity to double-check that broker-dealers and investment advisers have appropriate training for their employees and sturdy controls in place to prevent intentionally false information from harming investors.
Now don’t get me wrong. False rumors are bad, as I footnoted here two weeks ago. That’s true whether they impact small stocks like Microvision (MVIS) or large companies like Bear Stearns or Lehman Bros. (LEH). But, as Andrew Ross Sorkin wrote and blogged last week, stopping them seems to be easier said than done. Instead, it seems much easier to blame the short-sellers for the rumors, as Vanity Fair did here, even though it’s clearly not always the shorts who are responsible.
The other surprising thing about yesterday’s release was its timing. In all the years that I’ve been following the SEC, I’ve yet to see a Sunday press release. So clearly, they’re taking this pretty seriously. Of course, given the various ways that information moves these days — instant messages, anonymous email accounts, anonymous bloggers, unrecorded cell phones, Twitter, Facebook and lots of others — it seems like a mighty Herculean task.