Comments on: Could the NYT make money from its scoops? A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 By: partner.analyst Mon, 30 Apr 2012 20:14:20 +0000 I love the way you initiate the discussion. I live in Mexico and from many sources I have heard many corruption acts from Walmart and other companies such as America Movil. Having or not the information beforehand wouldn’t change their ethics…

By: philgomes Wed, 25 Apr 2012 20:34:16 +0000 I’m reminded of this NYT story about the BusinessWeek/Bloomberg integration:


One speaker was the head of Bloomberg’s “speed desk,” who was especially proud, according to people at the meeting, when the desk published a headline seconds ahead of Reuters, and a young trader had made enough money from that lead alone to buy a Hummer.

A Businessweek employee raised her hand. Why, she asked, would a journalist be proud of that?

At Bloomberg News, where writers’ salaries are tied, among other factors, to how many “market-moving” articles they have produced, Businessweek is fitting in like — well, like an 80-year-old print magazine in a company that is all about terminals.

=== ss/media/26bizweek.html

By: MrRFox Wed, 25 Apr 2012 12:07:17 +0000 “… what do you guys think about the items on that website?” (some spam artist)

I think this website would be a lot better without any of your items posted on it.

By: acebros Tue, 24 Apr 2012 21:22:19 +0000 Yes, the “insider-trading” issue has been much discussed, but it is at best tangential to the thrust of Felix’ story, which is (as I take it), can and should the Times sell early access to market-moving stories? This is precisely what Julius Reuter did when he sent fast boats to meet the steamers off Ireland before the transatlantic cable was laid — the foundation of the Reuters empire. But Reuter was running a PRIVATE news service.

The Times could do it, and, for all I know, The Times should do it, but that would put a clear end to The Newspaper of Record.

Perhaps The Newspaper of Record is already only an old-fart memory anyway — it’s certainly much diminished, in both quality and volume — maybe this is how the Sulzbergers and Goldens should get the last juice from the husk. Sad…and yet, Time hath his revolutions; there must be a period and an end to all things temporal ~ finis rerum ~ an end of names and dignities and whatsoever is terrene, and why not of Ochs? Where is Hay Whitney? Where is Chandler? and so on….

By: C.Rechtsteiner Tue, 24 Apr 2012 19:41:35 +0000 While the insider or early trading aspects are definitely a possibility (and have been well dissected in the comments above), the opportunity to monetize scoops via stand-alone “journalism” or “news” products may actually be one of the best ideas yet.

By: dsquared Tue, 24 Apr 2012 19:00:21 +0000 “If, however, senior management of the company does provide meaningful comment that influences the story, isn’t that enough to prevent sale of early access to the story since that’s arguably material non-public information?”

Potentially yes – in fact, the whole media safe-harbour under regulation FD for disclosures of non-public information is pretty dependent on the media outlet then not selectively disclosing it itself.

But it goes even further than that. You can’t assume that “the NYT’s story” is purely the property of the NYT for purposes of insider dealing regs. If the investigative reporter has talked to even one employee or fiduciary of the company, then that information is potentially misappropriated and the story therefore becomes material nonpublic information even for purposes of US law.

Felix says above that this practice would make corporate whistleblowers into insider dealers and says “I’m sure the lawyers could sort that out”. Well no; I’m sure that they couldn’t; selective “whistleblowing” to short sellers is not protected at all. It really, really isn’t in keeping with the spirit of the relevant securities laws to provide a means whereby inside information can be used by hedge funds to make a profit. Even if that would be a useful revenue stream for the New York Times.

By: realist50 Tue, 24 Apr 2012 18:24:15 +0000 “Dsquared”, not “Dquared”

I’ll also add that the typical deal scoop story – “Company X to buy Company Y” according to “people familiar with the matter” would be a textbook example of insider trading on material non public information if anyone did so, as the “people familiar with the matter” are almost certainly executives, bankers, or lawyers with a duty not to disclose the information.

That thought leads to another interesting point. Reporters almost always call a company in Wal-Mart’s shoes to ask for a comment. Frequently the answer is “no comment”. If, however, senior management of the company does provide meaningful comment that influences the story, isn’t that enough to prevent sale of early access to the story since that’s arguably material non-public information?

By: realist50 Tue, 24 Apr 2012 18:14:54 +0000 Dquared makes some great points. I think that selling early access to newspaper stories in the manner proposed by Felix has a lot of similarities to trading based on information from expert networks, which clearly generated prosecutions. The experts used by those groups are awfully similar to the sorts of sources used by newspaper reporters – current or former employees who have a duty to their employer and probably have a a mix of information that’s OK under insider trading law plus material nonpublic information. In this one, think of grey areas like calling up a sample of Applebee’s store managers to ask how business is going. Then there are people at 3rd-parties probably without a duty to the subject company, such as relying on customers and suppliers for channel checks. At a minimum, I see the idea of reports shielding the identity of sources going out the window once the SEC gets involved.

MrRFox, as to whether everyone has the same First Amendment rights, my short answer is that not everyone does once they get near the public markets as securities owners or issuers. Matt Levine at Dealbreaker wrote about a case that is definitely not an exact analog to Felix’s proposal, but illustrates the point that, First Amendment or not, saying that a statement is true isn’t always a defense under securities law – t-manager-stands-up-for-truth-and-the-am erican-way/

By: Bdylan Tue, 24 Apr 2012 18:05:10 +0000 Regarding huabao international, I knew I had seen this name before. Some of the evidence presented in the summary has similar analysis.  /ladies-in-elegant-high-heels-water-at. html

By: johncabell Tue, 24 Apr 2012 16:51:01 +0000 No mention of Mark Cuban’s ShareSleuth? :)