Friday, July 16, 2004

Martha, My Dear

I'm still drowsy and lazy from my recent surgery but I'm getting restless and bored.  I'm down to watching Tivo'd Mad About You clip shows.  My favorite pastime is to watch for when Helen Hunt's chest explodes into a wonderfully rounded bosom.
Finally, I turned on the news and caught the announcement that Martha Stewart's getting 5-months in the pokey.  I'll be honest about this:  I haven't followed the case at all.  I just gave Martha the benefit of the doubt and figured the prosecutor's were going after an easy and unpopular target.  But I figured I'd find out what she did....and no one on the news said.  They said she lied.  But what was the lie?  They didn't say.  Maybe this is all backstory that the rest of the country knows, I thought, so I hit the web and read the actual indictment.  I'm going with the assumption that all items were proven.  After giving the matter about 30 seconds of thought, I decided:  She got what she had coming-she may have even got off easy.
In case you weren't up on the specifics, what she did was this:  she sold before a stock, Imclone, tanked after her broker's assistant gave her a head's up that the the head of Imclone was bailing because the government wasn't going to approve one of their products.   Got that?  Read again, if you need to.  I did. That's not was she was indicted for.  She was indicted for lying about it.  Specifically, she changed phone messages from her broker, talked with the broker when instructed not to,  and conspired with him into saying the sale was planned beforehand which is not uncommon.
Now I love Martha and I think most men like her. I won't speak for the ladies.  She's hot.  She's fashionable, yes. Attractive, yes.  But she has a confident manner of holding herself that to most guys says sex.  If she wants it, she'll tell you to forego the dinner and wooing and get right to business.  So I want to lean toward her side, but....
I have my securities license, I'm familiar with the legal lectures CEOs get, and I can imagine what it takes to run a company like hers.  So here's my question:  having had her securities license and running a NYSE listed company, what was she doing actively trading her own account.  She's in a fiduciary position and the exposure to liability that this entails is huge.  She should have picked a nice money manager, have him put the assets in a blind trust and have quarterly meetings.  This is a small amount of insurance to protect herself personally from any allegations.  But this extents into her own firm-where a lot of her wealth is- because her name on the door.  She should have gone out of her way to stay spotless. 
Next, what is she doing running a company that size and dealing with these penny-ante trades trying to make a quick buck like some credit card indebted middle manager trying to score big.  She has a responsiblity to her shareholder's to be at work for them.  That's the other responsibility she took on when she went public.
Martha, I love what you've done.  Your inpiring and motivating and you built an industry from nothing.  You look good and like you're having fun.  You piss off all the right people which is a big plus with me.  But this Imclone stuff; this is cheap stuff and that's where I run into a problem, babe.
Martha, my dear, you're cheap stuff.