During the bull market of the 1990s, research on Wall Street lost much of its integrity, and, increasingly, most of its value in helping individual and institutional investors make sensible investment decisions.

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Consider that fewer than 1% of all Wall Street research reports are outright sell recommendations. This is a particularly astonishing figure given that nearly 85% of the stocks listed on the New York Stock Exchange are down, year to date. It says to me that analysts are simply not doing a good job, or are not acting independently.

Indeed, Wall Street research has deteriorated to the point that its analytical output has been rendered almost useless.

To be sure, there are excellent analysts at many brokerage firms. But, unfortunately, they are few and far between. Independent analysis has become nearly nonexistent, replaced instead by hidden agendas (analysts indentured to investment banking clients) and research that is neither thorough nor detailed. Instead of acting as analysts, analysts have been reduced to stenographers and cheerleaders.

Even with stocks so depressed, it is ever important to pay attention to possible indicators of trouble. So, how can the individual investor be on the watch for troubled companies that are candidates for sale or shorting?

Here's a list of 11 early warning signs that often serve as Indicators of Trouble:

1. Management that complains about short-sellers, and appears to be more interested in stock price than the company's fundamental business.

2. Competitors that are having problems or are exiting the business.

3. High turnover of key managers.

4. Increasing days of inventory on hand. Increasing days of receivables.

5. A company that is having a light quarter but is blaming it on the weather ("orders are slipping into the next quarter").

6. Companies that are late in reporting and that withhold vital information.

7. Companies that do not return analysts' phone calls -- especially when they were previously outgoing.

8. A company that has missed its estimates, or where the bull story is not playing out, yet the Street hasn't given up on the stock. Instead, the bullish analysts make excuses.

9. A company that has previously been a growth story, but sales have flattened out.

10. On a different note, watch it if the company is controlled by Ron Perelman, or ...

11. If senior management wears more jewelry than your mother, wife or girlfriend!

For those investors with larger portfolios who have the resources but not the time to do their own analysis, there are a number of valuable services that provide independent research away from Wall Street. These services specialize in finding companies/industries to avoid or to sell short.

I have used all three of the following sources as an adjunct to my research. I know the principals. All employ logic of argument and power of analytical dissection. While each has different skills, their research is impartial and their facts are thoroughly researched. The services can be relatively expensive -- but you get what you pay for.

For those who can't subscribe to these services, look for their names on RealMoney.com where they are periodically quoted by my colleagues.