Shares of Herbalife Ltd. got pounded for a fourth straight trading day on Wall Street, as investors sent the stock diving an additional 5% on Monday. The Los Angeles-based marketer of nutrition powders, bars and vitamins has seen its stock price plummet since New York hedge fund manager Bill Ackman last week called the company´s business a pyramid scheme. Its shares have lost about 40% since Ackman lodged his allegations. (Snip) Ackman has said he will continue shorting, or betting against, Herbalife´s stock until it reaches zero. Ackman´s reputation on Wall Street could lead other investors to
Comments: If what Ackerman says is true, why hasn´t either Wall Street or the Justice Department sought criminal action against Herbalife? Of course, letting the stock be shorted to zero [possibly] could be poetic.
Good grief, there´s nothing new about this, Herbalife (like Amway before it) has been an excuse for thirty years to write off your car and big part of your mortgage, nobody actually buys and uses the products.
Herbalife has been around for umpty dump years and first now this is an issue? Everyone knows the score there - and truthfully, if you work hard and build a network below you that´s what the business is all about. It would be a true pyramid if there was no ´´product´´. Avon and Mary Kay are structured exactly the same way. You sell the product yourself and if you´re happy there, that´s where you stay. BUT, if you build a network and get a piece of everyone else´s action I really don´t see how this is a negative.
Unless you end up with a closet of stuff you can´t use or sell...
I believe that Ackman sold Herbalife stock short before he made his accusations public. If true, that is known as stock manipulation and, regardless of whether he´s right or not, he should be prosecuted.
Some people were trying to something similar with Pre-Paid Legal Services stock several years ago. They wanted to drive the price of the stock down. Pre-Paid Legal made some management changes along with removing itself from the NYSE.
as others have said, Herbalife may or may not be a pyramid, but all of this info has been known for 30 years. (I have friends who´ve been involved) So what´s new now? This sounds like a bear raid by a group of short sellers, trying to drive the stock down.
#5.. Ackman is not an insider.. him taking a position and talking about it later is fine.. you might be alluding to FRONT RUNNING.. something the SEC investigated Jim Cramer of cnbc for allegedly doing in 2005..
i actually like Ackman.. seems to be somewhat of a leftie in his charitable giving, though..
The worst pyramid scheme of all is our own govt. It wouldn´t surprise me to learn that this is only the start of a move to destroy the network marketing businesses. True, there are thousands of scams out there, but to tear down the reputable organizations as well is irresponsible at best.
The federal government should prosecute all involved in this scheme. It´s nearly as crooked as that one that takes money out of your paycheck all year and puts the funds in a retirement plan with your name on it . All of the funds are then stored in a lockbox in a safe, crime-free area of Washington ,DC.
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