As a political science major, I have watched as The Fly he has morphed into calling b.s. on news stories. His greatest call of the year was on the election of Trump. Even I was a skeptic. Now I consider his rants much more closely.
So…The Fly has done a great job of calling out b.s. on fake news stories related to politics. That my friends is only half the battle. The other half of the battle is fake news stories on stocks which IMO is hurting investors as much if not more than fake news from politics.
Let me paint a picture with several examples of fake news.
1.The most offensive is someone, usually a hedge fund, starting a rumor of a buyout for a company so that they can dump their position. A seasoned pro can spot this a mile away. Or the hedge fund that gets short and then plants a story on the company they shorted.
2.Economic data points that get revised a month later after driving market in a wrong direction. Can you say unemployment report. It moves markets the first Friday of each month then a month later it is revised.
3.Company driven fake news. Great example Acacia Communications (ACIA) gets rocked on Tuesday when they speak at the Needham Conference dropping from $64.64 high to $57.74 by the close. Why? In their presentation, Acacia is guarded on China. Then after in 1 on 1s they clarify and the stock climbs from $57.74 to this morning’s price of $60.59. A serious WTF. I guess Reg FD does not apply to companies.
I can go on with other areas but you get the point. Fake news creates opportunities.
The Fly is a stud on sniffing this stuff out. He is followed widely and I dare say that I would like to see him now take the lead on fake news related to stocks as well as political fake news. In fact, I would like to see a tag the alerts to #fakenewsthefly.
P.S. Related to #3 how many companies are getting prosecuted for insider trading?
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