May 18, 2011
Any author can be highly short a manipulative stock and write a defamatory article driving a stock down very easily. This is stock manipulation. The writer would say he is performing a service warning investors about the negativity of a stock while he/she is really profiting on the decline of a stock. I lost over $100K in such a scheme where the author drove down the stock price to meet his own gain of beong shorted a stock.
It can work the other way too. Pump and dump. Drive the price up and sell the stock off when it reaches a high value hurting those who bought at a high price.
All authors of an article of a stock must publish their position in the stock and if possible the amount they are holding, whether short, long, call, or put.
I believe no author or contributor or investment firm or stock brokerage should be legally allowed to own any type of holding (short, long, put, call) in a stock he/she is writing about in a public setting. Any person found holding a position at the time an article is published (lets say before or after a 10 day period) must relinquish all profits made in that stock. They must also be fined and reprimanded not to perform public service in selling securities publicly and not allowed to publish articles in a specified time period. Too many profiteers making gains on the backs of poor investors being swindled out of their investment by unscruptulous publishers of defamatory articles.