SEC and Public Postings

I have to say there’s something moderately creepy about the Security and Exchange Commission’s plan to monitor Internet postings (Wired News) in stock chat rooms and bulletin boards. But I also have to note that these are public postings, not private conversations.

Critics who liken this to wholesale monitoring of telephone conversations are creating straw men. They’re clever, because they’re gaining traction in public opinion, and they’re doing it by misleading people.

The SEC’s plan is a bad idea, anyway, and probably a violation of the federal Privacy Act. But it’s a response to a genuine problem.

Some of the postings on the financial Web sites are plainly being created by con artists. Their techniques are typical sleaze: pump up lousy stocks and then dump them; plant false rumors to persuade share owners to sell perfectly good stocks; and other such stuff. The SEC has a right and duty to go after people who defraud others.

At the heart of this problem, however, is the nature of the chat rooms and bulletin boards. I’m astonished at the way otherwise rational investors will almost automatically believe what they read in an online forum. I’m also not very sympathetic to everyone who gets conned, because in some cases people are so greedy that they ignore obvious signs of fraud.

The Net’s diversity is its greatest feature, not a horrible problem. But it’s also a new kind of place, and we need to recognize that.

We need new rules of behavior — our own behavior, that is — in this new cyber-world. I am a relatively trusting soul in the physical world. But I don’t have any particular trust for things I read online when I don’t have a basis to know whether the writer is credible.

And I don’t believe anything I read in an anonymous posting, ever. I don’t assume it’s untrue, either. I do assume I’ll have to check it out.

What Concessions from Microsoft?

ZDNet’s Mary Jo Foley has done the homework the national press forgot to do: She asked manufacturers and software developers how the leaked terms of a proposed Microsoft antitrust settlement would affect them. It’s a con game, most replied.

Steve Baller, Microsoft’s CEO, says the company’s settlement offer is the real thing.

This entry was posted in Archives. Bookmark the permalink.