Monday, June 19, 2006

The Party of "Pump and Dump"

The NY Times Opinionator Blog is a weird creature whose home page you can see but whose permalinks and comments require a TimeSelect subscription.

So here's the home page, and here's hoping the June 16 entry at 3:40 PM is still there when you read this (HT OH02). It's worth a full read, but I want to focus on Jerome Armstrong, co-author with Kos of "Crashing the Gates" and current high-level adviser to Presidential candidate Mark Warner, and one other netroots "pioneer."

Armstrong is an admitted penny-stock pump-and-dump perpetrator (the stock discussed here is of a company called Blue Point), and Trippi has a similar background:

Which, interestingly, is precisely what the Securities and Exchange Commission, in court documents filed last August, alleges that Jerome Armstrong did in 2000. (The original S.E.C. complaint is here.) In a subsequent filing, the S.E.C. alleges that “there is sufficient evidence to infer that the defendants secretly agreed to pay Armstrong for his touting efforts” on the financial Web site Raging Bull.

Without admitting or denying anything, Armstrong has agreed to a permanent injunction that forbids him from touting stocks in the future. The S.E.C. remains in litigation with him over the subject of potential monetary penalties.

Nothing illegal is alleged to have occurred during the Dean campaign or during Armstrong’s subsequent adventures in online politics, but the links between online stock speculation and online politics are delicious. During the 2000 campaign, Wired contributor Gary Wolf described former Dean campaign manager Joe Trippi as “a petty stock speculator on one of the most egregious bubble discussion forums on Raging Bull,” and Wolf even uncovered a Raging Bull interview with Trippi, who posted on the site under the alias “random1.” The New Republic’s Noam Scheiber suggested, in his 2003 profile of Trippi, that everything the Dean campaign manager knew about online politics he adapted from his experience as a Raging Bull poster.

Trippi’s favorite stock, like his political candidate, tanked, as New York Times Magazine contributor Rob Walker half-predicted in an e-mail newsletter in January 2004.

Again, no illegality is implied, but it’s irresistible to compare Armstrong’s life as a “netroots” adviser with the experiences of contributors — including Armstrong and Trippi — to Raging Bull forums.

Then we have The New York Post's piece today on Armstrong, which adds the following to the mix:
A frequent subject of glowing media profiles on the growing role of the Internet in campaigning, Armstrong now directs Internet strategy for 2008 presidential hopeful Mark Warner.

The sharp partisan flair Armstrong shows on his blog was apparently honed in bitter message-board fights, where he was known for his attacks on those questioning the stocks he touted.

Floyd Schneider, a New Jersey mortgage broker and investigator of penny-stock scams, said he was a repeated target of Armstrong's attacks because he criticized the finances and business models of firms Armstrong supported.

"[Armstrong] was among the nastiest and ugliest stock touts from that era," said Schneider. "The stocks he touted were dogs and rigged, so it makes sense that he had a deal with promoters."

The important point here is that Schneider's quote makes it obvious that Armstrong's involvement with Blue Point was not an isolated situation.

So two of the leading lights of the liberal netroots, Joe Trippi with Howard Dean, and now Jerome Armstrong (who besides what's noted above played an integral role in the political assassination of Paul Hackett's senate candidacy) with Mark Warner, are (perhaps unreformed) pump and dump specialists, committing acts normally associated with unscrupulous conservatives/Republicans.

Does anyone think that if the conservative or Republican blogospheres were dominated by people with similar backgrounds that it would have taken so long for us to learn these things?

It might be fair to argue that the lib netroots, and at least one presidential candidate, have been co-opted by a term we've heard hurled at conservatives -- a "culture of corruption."

JUNE 20 UPDATE: The Opinionator home page is no longer accessible, which makes me think that its availability was a mistake on the part of The Times from the beginning.

Lots more discussion and additional reporting on Armstrong, Kos, and Trippi: Outside the Beltway, TKS, Tom Maguire/Just One Minute, Decision 08, Decision 08 again, Donkey Cons, The Commissar -- and there's a lot more.

Why it's important from Decision 08 -- "Credibility is getting harder and harder to come by in the progressive world - Markos was paid for shilling for Dean; Armstrong, who has a past as a scam artist, now works for Warner; Atrios is bought and paid for by George Soros. It’s a brave new world, all right, this Nutroots® thing - but it smells an awful lot like good old-fashioned payola."

It looks more and more to me like the moonbat crowd has been played for all it is worth by a bunch of money-grubbers posing as high-minded activists.

UPDATE 2, JUNE 20: Well, "staff" at BSB reminds us of his/their Kos disillusionment, with links to previous BSB posts -- "I caught a lot of heat at the time for writing this, and this. As someone who used to post and participate regularly at dkos I must say I do feel a sense of disappointment. It became obvious to me some time ago, as my writing shows that it was a scam, perpetrated on people desperate for change and leadership. Instead the stewards, kos and Armstrong sold them out - and continue to do so."


Steven J. Kelso Sr. said...

BSB deserves praise for the honesty and consistancy.

BizzyBlog said...

Absolutely agree, on this matter. Don't know enough otherwise to comment on other areas.