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If pink is the new black, then utter silence must be the new public discourse.
All around us today, we see public companies that have, well, stopped talking to the public. Perhaps the business world going all Sphinx on us makes some larger sense, in an age when the two top contenders for their parties' nomination to be leader of the free world, Hillary Clinton and Rudolph Giuliani, barely deign to answer to the free public. Their stance that public officials don't necessarily have an obligation to face the folks has recent precedence in the virtually silent forms of George W. Bush and Dick Cheney.
I'll let others speak to what voters should do with politicians who clam up. I'm just interested in public companies that do the Sphinx.
The Business Press Maven normally has long and well-developed threads of advice garnered from the morning's news. On this particular topic, though, I don't have much to say besides "Be careful."
A Lack of Specifics
, a company run by one of the few people The Business Press Maven is willing to deify,
reported crummy earnings yesterday.
released a statement with the bumptious claim that a "transformation" was under way, in addition to platitudes about how what matters is its "future course of action." It assured the investing public that the company would be known for all manner of good things in the public, which, without detailed follow-up, is a little like The Business Press Maven assuring you that he will become a famous song-and-dance man one day.
As for specifics, there weren't any. And for follow-up questions, the sort that can fill out those big claims or show them up to be as thin as a leek? There weren't any. The company held no conference call. As in, none.
Taking a ride over to
, we see a company that, after swearing off the flubbing-up of its accounting, just had to ask the
Securities and Exchange Commission
to delay the publishing of its annual report, the slickest, most staged (read: absolute easiest) communication obligation to the public that a public company has.
How bad has the situation gotten? Put it this way:
, which has been criticized for its pace of disclosure, was actually praised to the skies in some quarters for, uh, publicly Webcasting a conference call with analysts.
Thanks, guys. That was mighty nice of you.
Yes, I'm being my intolerably caustic self. Thanking a company for a Webcast is a little like congratulating a president for taking questions from an audience that isn't handpicked.
What's an Investor to Do?
Are there sometimes regulatory reasons why a company is afraid to speak? Well, sure. But as an investor, you have to play the odds, acting on impressions taken from actions. And if you are watching the police talk to someone who suddenly refuses to talk, well, the presumption of innocence would still be there in a technical sense, but would you actually place money on his innocence? No. You'd stay clear -- for the time being, at least.
That example might sound a touch trite, but I do think that in the vast majority of cases, when a company isn't talking, an investor should, at minimum, wait by just as silently until it does.
The Business Press Maven, for example, thinks that Michael Dell is a genius and, with his
well-timed comeback to the release of Vista, just might be able to budge his company back to the realm of the living.
But as long as he is hiding under his office desk, I'm not investing.
Speaking of not investing, I would not touch an airline with a 39 1/2-foot pole. But a week that started with
the defense of
must end with ... a second line of defense.
In that column, I pointed out that when a customer-relations problem (whether it be plane delays or rats gone wild in a restaurant) crosses over from the business to the popular press over a short period of time, it usually means that too much was made of what was essentially a singular issue and that there may be opportunity there for investors.
In terms of JetBlue, I was going to write that, next thing you knew, this quality airline was going to be mentioned as the next
. But then I thought better of it, that it was going too far, that the business media could never be
obtuse. And that, my friends, is why I wanted to poke my eyes out with sticks when I
read an article in
titled (I kid you not): "Is JetBlue The Next People Express?"
(Note to my editors: I think I deserve combat pay sometimes. Reading articles like this is one brutal line of reporting.)
Anyhow, I don't want to pay this article much mind. Suffice to say, People Express, which was created in the early 1980s when The Business Press Maven was living a life dedicated to spin-the-bottle, came about in the wake of airline deregulation and offered absolutely no frills (some described it as Eastern Bloc Chic) for a low price.
JetBlue is so, so much more. And when you are a business competing on more than price -- in fact, on a good combination of good service and good price -- you stand a much better chance.
And that's all I have to say. Just like everyone else, The Business Press Maven will now look the public in the face and stare silently.
At the time of publication, Fuchs had no positions in any of the stocks mentioned in this column.
A journalist with a background on Wall Street, Marek Fuchs has written the County Lines column for The New York Times for the past five years. He also contributes regular breaking news and feature stories to many of the paper's other sections, including Metro, National and Sports. Fuchs was the editor-in-chief of Fertilemind.net, a financial Web site twice named "Best of the Web" by Forbes Magazine. He was also a stockbroker with Shearson Lehman Brothers in Manhattan and a money manager. He is currently writing a chapter for a book coming out in early 2007 on a really embarrassing subject. He lives in a loud house with three children. Fuchs appreciates your feedback;
to send him an email.