Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : InfoSpace (INSP): Where GNET went! -- Ignore unavailable to you. Want to Upgrade?

To: Carolyn who wrote (26243)	7/11/2001 1:44:13 PM
From: Sarkie	Read Replies (1) \| Respond to of 28311

He can't be that stupid. He has to know.

To: Carolyn who wrote (26243)	7/11/2001 6:33:53 PM
From: KLP	Respond to of 28311

And yet another PR...(of the bad sort)...Blodget's bad news July 10, 2001 by Kent German siliconinvestor.com From the July 2001 issue of UPSIDE magazine. Things are getting a little hairy for Merrill Lynch's (MER) Henry Blodget. Just two years ago, this braggart of an analyst could send a tech stock soaring just by opening his mouth; now, he is fighting off a new kind of threat that is circling ever closer. Claiming he was misled by two of Blodget's stock picks, Infospace (INSP) and JDS Uniphase (JDSU), New York doctor Debases Kanjilal filed a $10 million lawsuit against the boy wonder and Merrill Lynch last February. Both stocks followed the 2001 technology tumbles, dropping from 52-week highs of $78.25 and $140.50, respectively, to lows of $1.56 and $13.06 by April. On Monday, Infospace closed down 3.75 percent to $3.34, while JDS gained 3.8 percent to $11.74. Though his debts are somewhat meager, as the market goes -- around $500,000 -- Kanjilal is alleging that he suffered the losses "as a result of systematic fraud by stock analysts, which occurs on an industrywide basis." Hmmm, I smell a Barbara Walters special. Bad calls But wait; there's more. Kanjilal is also inventing a conspiracy of sorts surrounding Infospace's $4 billion purchase of Web portal Go2Net in July of last year. Because Merrill Lynch had been retained as a financial adviser to Go2Net prior to the sale, Kanjilal is claiming that Blodget knew about the merger beforehand and maintained his "buy" rating on Infospace to bolster the share price. Of course, for Merrill Lynch's part in the lawsuit, spokesman Joe Cohen is dismissing the conflict-of-interest charge as a load of well, you know. "Mr. Blodget is a professional of integrity, and Merrill Lynch stands behind him," Cohen says. "Our goal is to have the highest-quality research." Whoa, wait a second. Isn't this the same Blodget who wrote in a 1999 column that, unlike other famous economic bubbles, "the Internet bubble is riding on rock-solid fundamentals"? Talk about your bad calls; that fundamental proved to be about as rock solid as Bill Clinton's fidelity. In that same column, Blodget called Amazon.com (AMZN) one of the "early 21st century's leading growth companies." Still unprofitable, the only thing growing at Amazon is the company's debt. Fightin' words Cohen emphasizes that any sophisticated and experienced investor should know that stock recommendations are just that -- not exactly rocket science. But that doesn't dissuade Kanjilal's lawyer, Jacob Zamansky, who calls Blodget a cheerleader for his investment bank clients. "[Blodget's] not a dumb guy; he's just unseasoned," Zamansky says. "He's an articulate touter with the weight of the Merrill Lynch PR machine behind him." Wow, them is fightin' words. While some would probably like to see Blodget tarred and feathered in Times Square, a suit of such magnitude could be the start of a rising backlash (and yet more lawsuits) against the investment banks. And, though Kanjilal's suit is a long shot, Merrill Lynch is doing its best to circle the wagons.