Writing For A Short Seller, The Debate Continues

Would you ever writer for a short-seller?

The debate continued this weekend as Reuters Felix Salmon threw cold water on the American Journalism Review‘s story about the ethical implication of writing investigative pieces on companies for an owner that bets against the same companies in the stock market. As Salmon points out, it’s not an issue because so few actually do it.

For one thing, the whole subject is something of a non-issue, given the two examples that Spivak has managed to find. The first is Mark Cuban’s Sharesleuth, which was launched in 2006; in the four years since then, Cuban has shorted the grand total of three companies that Sharesleuth has written about. The second site is iBusiness Reporting, which launched in February and seems to have lasted about three months; it hasn’t updated its site since May 14.

Then Salmon continues, saying that almost all forms of journalism come from a company that’s trying to make money off of the journalists’ stories. In most cases, it’s a company trying to profit off of newsstand sales, but that has declined as of late. So new business models, like short-selling journalism has popped up.

But Salmon does make it clear there’s one problem with the short-selling business model that Sharesleuth attempts to pull off.

“The main problem with short-funded investigative journalism is that there’s no evidence that the business model actually works in practice. And other journalists who have tried to set up on their own with the aim of selling their work to short sellers have also given up on that idea and moved on to more time-tested ways of making money.”

Interesting point. It seems as long as the short selling side of the business doesn’t affect the journalism aspect, then it’s a fine work environment. Would you write for a site where you know the owner will bet against the company you are writing about?