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To: bob zagorin who wrote (21351)	7/16/2004 12:10:08 PM
From: bob zagorin	Respond to of 57684

and another reminder about analysts JULY 15, 2004 NEWS ANALYSIS By Brian Hindo A New, Improved Henry Blodget The disgraced bubble-era analyst is now offering industry analysis, free for now, with the caveat: "Predictions will sometimes be wrong" Henry Blodget is back in the research business -- sort of. BusinessWeek has learned that the former Merrill Lynch analyst has a fledgling company that plans to provide industry analysis and consulting services. Blodget, who became an emblem of boom-era hucksterism for his public touting of Internet stocks -- some of which he was trashing in personal e-mail -- was barred for life from the securities industry in 2003 by the Securities & Exchange Commission, the National Association of Securities Dealsers, and the New York Stock Exchange. An SEC spokesman declined to say whether Blodget's plans violated the terms of his settlement. Blodget says his firm, Cherry Hill Research, won't do any stock research, per the agreement. TOO CLOSE FOR COMFORT? Legal experts say the venture sounds permissible but note that exactly what Blodget can and can't do is still a little unclear. "He's got an interesting road to hoe," says James D. Cox, a law professor at Duke University. "There's not any template." However, Blodget's critics feel it's too close for comfort. "This was supposed to be a broad prohibition from him being anywhere near the securities industry," says New York securities lawyer Jacob H. Zamansky, who reached a settlement with Merrill Lynch relating to Blodget's equity research. Blodget's New York-based Cherry Hill has taken its first steps with a "Google-inspired" research paper analyzing different initial public offering methods, distributed free to academics. "To say it's garage-based would be an insult to real companies located there," Blodget writes in an e-mail responding to inquiries from BusinessWeek. A real push for business is a ways off, if ever, Blodget says, adding he's keeping busy in the meantime with freelance writing work. "IGNORANCE AND/OR IDIOCY." Judging by the "important disclosure" notes at the end of the research paper, it appears Blodget isn't taking his predictions too seriously this time: "We can guarantee that our opinions, conclusions, and predictions will sometimes be wrong.... Sometimes [errors] will result from mistakes, ignorance, and/or idiocy." Later on, in a section almost certainly inspired by the embarrassing e-mails he wrote that investigators uncovered and used against him: "We may express initial reactions to information or events and then conclude that these reactions were wrong. We may exaggerate, blow off steam, be sarcastic, or otherwise apply lower standards of accuracy and professionalism in casual communications than in publications. Such utterances may be or seem inconsistent with our professional opinions." Finally, after disclosing his ownership of 3,600 shares of Yahoo! (YHOO ), 1,000 shares of Amazon (AMZN ), and 1,800 shares of Time Warner (TWX ), he makes clear that he's not trying -- nor legally able -- to offer investment advice. Still, he warns, "we prefer that the prices of stocks we own go up, not down, so you might conclude that our opinions are skewed by self-interest, hopes, dreams, and/or 'rooting bias.'" How's that for disclosure? Hindo is a staff editor for BusinessWeek in New York Edited by Douglas Harbrecht