The Five Dumbest Things on Wall Street This Week

Circulation Logic Now I don't know my ABC...

The ABC's rules "govern not only how audits are conducted, but also how publishers report their circulation figures," says the ABC. "ABC strives to conduct audits that set the industry standard for integrity, objectivity, and accuracy, and uses state-of-the-art techniques to produce and disseminate ABC-audited information."

Sounds impressive. Except for the part about how an auditing organization with "Audit" in its name apparently missed several years of overstatements in circulation by a major U.S. newspaper.

That's a shock, isn't it? An auditor not catching wind of an alleged multiyear fraud? Who'd have thunk it?

Anyway, we called up ABC to find out how its industry-standard-setting integrity, objectivity and accuracy fell down on the job in Chicago. "Our audits are very stringent," says a spokeswoman, who declined to discuss the specifics of the Sun-Times case. "There's a high degree of stringency involved with each and every audit."

That reassured us. Until we got another statement from another ABC spokeswoman. "ABC audits are not designed to detect a concerted deliberate intent to misstate information," says ABC.

Oh. Now they tell us.

5. Adding Injury to Insult

When all is said and done, what really matters is your health, right?

Wrong -- at least if you work at 99 Cents Only Stores .

See, we know that employees are supposed to keep their personal lives separate from their professional lives and all that. Still, the discount retailer's recent efforts to downplay medical problems faced by its CEO struck us as borderline absurd.

We're referring specifically to last Friday's announcement from 99 Cents, one that focused primarily on how the discount retailer said it would miss prior guidance for the second quarter to a colossal degree.

Instead of April's forecast that 99 Cents will earn 19 to 20 cents per share in the quarter ending June 30, the company now says earnings per share will come in between 4 and 7 cents.

But that's not all. Same-store sales in the quarter will be worse than expected. Prior guidance for the rest of the year is being withdrawn. The financial news was bad enough to send 99 Cents' shares down 31% in a single day.

But lost in all the bad news was a separate piece of information that shareholders might have found disturbing -- if they even found it at all.

Hidden deep inside Monday's press release -- following 1,031 words devoted to the restated guidance and preceding the blah-blah boilerplate announcing that 99 Cents Only Stores makes forward-looking statements -- came this relevant piece of news: "We also report that our CEO, Chairman and founder Dave Gold is presently hospitalized after heart bypass surgery earlier this week."

In other words, the guy who has led the company for nearly 40 years is a little out of pocket right now.

Considering that Gold is a key man at the company, and considering that the company gave no prior indication that anything was wrong with him, we think it kind of odd that the company made such a little deal about the operation.

(On Monday, 99 Cents said Gold was "recuperating satisfactorily" from his "scheduled elective" surgery. We're glad to hear it. Even so, we find the company's "elective" characterization kind of odd. It's as if the company is implying that bypass surgery is no more serious than a tummy tuck.)

So there's our two cents. We left a message at 99 Cents asking to talk about Gold, but no one dropped a dime to return our call.

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