Ackman joins the green-ink brigade

By Felix Salmon
June 1, 2009

Joe Nocera’s column on Bill Ackman led with Ackman crying during the Target AGM. He continued:

He made it sound as if he had achieved a moral victory just by the fact that he had waged this proxy fight. Somehow, he seemed to believe, it was going to make corporate America a better place.

Then — I kid you not — he started quoting John F. Kennedy. “We will pay any price, bear any burden, meet any hardship,” he said. And that’s when the tears started welling up.

Ackman did not take this well. In fact, he fired off a 5,238-word letter to the New York Times, addressed not to Nocera but to “the Editor”, and signed “Sincerely, William A. Ackman”. Along the way — after accusing Nocera of having penned “the pettiest form of hateful and destructive journalism” — Ackman admits that maybe he went a little bit too far with the whole JFK schtick:

I wrote my brief remarks in the hotel the morning of the meeting and looked for inspiration from some of the great speeches I had heard and read over the course of my life. I wrote these words alone. I shared them with no one. Clearly I got somewhat carried away.

But in the annals of getting somewhat carried away, Ackman’s speech at Target’s AGM is nothing compared to his letter to the NYT. He even manages to drag another youthful and charismatic president down into a rather silly dispute:

President Obama would never call his next-term election opponent a distraction because our President understands, as Mr. Nocera should, that our country’s democratic system and American corporations’ success or failure depend upon incumbency being challenged by strong competition, no matter what the quality of the sitting president or a company’s board members.

It’s hard to square this kind of tone-deafness — it’s a column, guy, get over it — with Nocera’s portrait of Ackman as Man of the Media:

Over the years, he has also become increasingly comfortable using the news media as a way to help put pressure on companies. When he first appeared on my radar screen, Mr. Ackman was so press-shy he refused to allow Fortune magazine, then my employer, to take his photograph. Now he happily co-hosts CNBC’s “Squawk Box,” trading bons mots with Becky, Joe and the gang. He has gone from being awkward in public to silky smooth.

The single biggest risk facing any hedge fund manager is overconfidence — and I think that what has happened here is that Ackman, in the wake of all those hours wallowing in CNBC obsequiousness, has lost his initial — and perfectly natural — fear and mistrust of the media. Instead, he can fire off a monster siwoti letter like this one without stopping to think of how it will be perceived. Big mistake: he’s now much more of an object of ridicule than he ever was before the letter was published.

But desperate men, I suppose, will do desperate things. Let’s hope that GGP investment works out better for him.


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How could the recipient of a Bloomberg profile that lingered lovingly on his perfect SAT scores not think he had the right to an uncritical press? Maybe poor Mr. Ackman has discovered that they love you when you’re short, not so much when you’re long.

Ackman is a fraud and a parasite. He claims his goal is only to hold corporate boards accountable, but if that was the case, there are probably thousands of publicly traded companies far more deserving of his attention that Target. He could have, for instance, targeted (no pun intended) the board of GM a couple years ago, when it was obvious to many that they were headed down a toilet. Or AIG, or almost any large bank. But no, he picked a relatively successful retail business, because he felt there was money to be made in greenmail.

And now he’s crying about how he’s portrayed in an article? His only hope is a relapse of the economy, so that Target starts to lose money, otherwise, he’s going to lose a lot of money. and it couldn’t happen to a nicer guy.

Posted by KenG | Report as abusive

altho i agree fully with the statement that the biggest risk to a hedge fund managers is over-confidence, i also think that the press (and the ‘comments’) are often, when it comes to hedge funds or activists very quick to attack them, and be very populist.
More often than not, Ackman was portrayed as a speculator, loser, cryer, liar etc
I think that journalist should establish facts rather than make shortcuts, or express their own opinion.
-speculator: he is investor (buying or shorting stocks or credit) so that is what he is being paid for, by his investors
- loser: his only fund, out of 5, to have lost money is this PS IV (it is a 2x levered play on Target share with no hedge to protect or cushion this leverared, concentrated bet) but his flagship did very well in 2007 (on the back of MBIA short) and relatively well in 2008 (losing only a quarter of what equity indices dropped)
- cryer: i was not at this AGM so can’t comment
- liar: some many articles mentioned Ackman said something, then made a u-turn or did not stick to his word. Again taking some words or statement out of the context is very misleading. And a lot of things with Target happened behind the scene, so journalists are sometimes just speculating or second-guessing what Ackman meant.

It would be good that business reporters just report facts, not just tell stories, speculating other people thinking. The article of Nocera is very approximate and light. He should have read in details the presentation of Ackman to Target shareholders and to ISS/Riskmetrics (all these documents were available, on-line, but maybe reading and understanding a 80-pages document is a bridge too far for some so-called journalists….

Posted by Joe Blog | Report as abusive

Ackman is a one-trick pony.
He proposed the same financial engineering tricks for Canadian Tire in 2007, and had a ridiculously high valuation for the shares.

Posted by Dave, Canada | Report as abusive

Felix: I’m going to disagree with you in this case. Although I believe Ackman’s high-mindedness was insincere, I also think he made a shrewd calculation by claiming virtuous behavior, and this will pay off for him in the long run. My detailed analysis of this tradition in American politics and business can be found at