News Flash (not): Analysts Are Now Free to Tell the Truth

In another interesting Reuters
filed over the weekend, which made those of us who follow the routine
Wall Street shenanigans closely grin and giggle, is one titled Honesty the
New Policy Among Analysts
authored by Mary Kelleher. For our international
readers, Wall Street analysts, many of whom read this column and CompoundSemi
routinely (head’s up you guys… you’re gonna love this one)…
it seems, according to Mary Kelleher, "Wall Street stock analysts finally
are telling people what they really think." J. McD editorial aside:
presumably that statement means its the analysts that get to be candid versus
. The report goes on to say: "After years of pacifying
corporate clients by putting ambiguous ‘hold’ ratings on stocks that they actually
recommend investors ditch, analysts are talking straight and rating more shares
with a candid ‘sell.’ Why the sudden courage? Look no further than new rules
requiring analysts list the number of ‘buys,’ ‘holds’ and ‘sells’ on research
reports. A wide-ranging probe into overly bullish research also has rebuilt
walls between research and investment banking units, enabling analysts to speak
more freely." The only thing we can add to this enlightened "news"
is… It’s about time!

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