Sunday, September 23, 2007

A Death in Baloneyland


The new look at NCANS

The astroturfing website that promoted "naked short-selling" conspiracy theories -- a phony issue pushed by CEOs of crappy companies to divert regulators from real investor concerns -- is no more.

Visitors to the "National Coalition Against Naked Shortselling" site -- and there sure as hell haven't been many lately -- are now greeted with the dread Internet error message that means that a website has given up the ghost.

The site pushed the interests of corporate excuse-mongers everywhere, and was especially shrill at promoting the disastrous Novastar Financial subprime lender and the SEC-investigated monstrosity Overstock.com. The group was fronted by a coot named Mary Helburn, who once famously called Enron a victim of naked shorting.

This "organization" was so brimming with baloney that it didn't even know what its name was. It was variously known as the "National Coalition Against Naked Shortselling" on its site and the "National Coalition Against Naked Shorting" in its incoherent SEC comment letters.

A note on the "sanitycheck" stock market conspiracy website says that "NCANS is going to be incorporated into this site over the next few weeks, as this site is the de facto hub now for issues NCANS is grappling with." Translation: NCANS is kaput. The ostensible reason it was a "duplication of effort" to keep the site active.

Since that is a lame lie by even Baloney Brigade standards, I assume the site's funding source -- Patrick Byrne of Overstock.com, I would imagine -- has closed his checkbook for legal reasons.

Since the NCANS did not exist except for the little-viewed website and a similarly moribund Yahoo discussion group, this means that a minor but annoying source of investor misinformation has, thankfully, bitten the dust.

The NCANS site promoted kooky conspiracy theories, smears against media critics, and served as a sounding board for "Dr." Patrick Byrne, the wack-a-doo CEO of Overstock.com. Since it was created a couple of years ago, the anti-shorting movement has lost whatever credibiltiy that it may have had, thanks to Byrne's antics and the stench of his creepy house stalker, Judd Bagley.

Though barely alive, the "sanitycheck" website, run by a former used medical equipment salesman named Phil Saunders (a/k/a "Bob O'Brien), seems ready to give up the ghost as well. At one time it was interesting to see what clearly insane people had to say, but the shock value of that is also getting a bit old.


Though Alexa numbers are notoriously unreliable, they do give a rough gauge of readership, and indicate that Sanitycheck's following has flocked elsewhere. (To 9-11 conspiracy sites I would reckon.) As you can see from the three-year Alexa chart above, the site received a spurt of readership when promoted by Byrne, in a famously wacky CNBC appearance (below), and was sustained by links on every single Overstock page under the misleading title "Market Reform."


The page links have now dwindled from thousands to a mere one, as Byrne -- doubtless acting under legal advice and/or SEC pressure -- has taken down the links to Saunders's site. Byrne now has taken the important job of smearing his critics in-house, with screwball posts on an Overstock message board and the antisocialmedia.net corporate smear site.

Withdrawal of Overstock support has meant that "sanitycheck's" Alexa chart now has an uncanny resemblance to the price chart of Saunders favorite stock Novastar, which he shamelessly hyped on the web. It still amazes me that people would buy, or not sell, stock on the basis of the ravings of an unhinged anonymous idiot like Saunders. But it really happened.

To be sure, Byrne and other corporate blame-deflectors have not given up. Byrne's checkbook is still open, and is pouring Overstock's scarce cash into lobbying the SEC over this nonexistent problem. But any pretense of the anti-shorting movement being anything other than a corporate-financed astroturf operation is now, officially, kaput.

© 2007 Gary Weiss. All rights reserved.

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Wall Street Versus America was published by Penguin USA on April 6.
Click here for its Amazon.com listing and here for more information on the book, from my web site, gary-weiss.com.

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