- Were Wall Street insiders given an illegal heads up regarding
America's first mad cow? In reviewing market data, there seems to be something
rotten in the stock market, and I'm not referring to feed lots, where cows
are fattened by being force fed lots of corn and live in their own excrement.
Come to think of it, that seems a lot like the ugliest part of Wall Street
that often produces insider trading scandals.
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- Speaking of ugly, take a look at the chief advisors to
USDA Secretary Ann Veneman. Her closest aides have ties to the meat industry.
There is a long paper trail from her office which leads directly to meat-producing
National Cattleman's Association.
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- On December 23, 2003, after the stock market had ended
its daily trading, USDA announced that a suspected case of Mad Cow Disease
had been indentified in the state of Washington. Two days later, lab tests
confirmed cattlemen's worst fear. USDA possessed this information long
before their official announcement.
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- Who are these USDA phonies kidding? Americans, that's
who. They alerted us on the evening of December 23rd that there was a "suspected"
mad cow. By then, it was too late for most Americans to return Christmas
roast beasts to their butchers. On Christmas day, we were told that the
brain of that animal tested positive in a British lab for Mad Cow Disease.
A few days later, entire herds were placed into quarantine. Over six hundred
animals have been slaughtered. Analyses of their brains takes 2-3 weeks
to reach anxious consumers. So, figure it out. How then, could the analyses
of the first cow brain take just two days? No way. The animal's brain was
sent to experts in England for careful analyses many weeks earlier. What
had been kept from Americans was truth. Cattlemen had an opportunity to
prepare for this.
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- A historical review of market trades reveals that the
bad news may have been delivered to meat industry insiders three weeks
earlier. They had plenty of time to do damage control before the rest of
America got the news. Publicists and spin doctors applied their form of
marketing medication so that the bad news would be buffered by rosy outlooks
from Veneman and President Bush.
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- An official investigation should ask why did stock market
prices began to fall lomg before the announcement. That same investigation
will explore why stock market prices for McDonald's and Wendy's increased
in the days and weeks after the Mad Cow revelation. The market should have
gone down, not up. Is the world insane?
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- The timing of the release of this story should not come
as any comfort to the Seattle families who dined on tainted beef from that
mad cow. For them, the fear of Mad Cow Disease is something that they will
live with for many years.
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- Let's examine trade histories for McDonalds (MCD) and
Wendy's (WEN):
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- ......12/3...12/17...12/24...01/2...01/9...01/16
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- MCD $26.58 $24.50 $23.96 $24.79 $25.15 $25.31
- WEN $40.30 $37.97 $37.39 $39.11 $38.00 $39.49
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- It is clear to see that during the two week period from
12/3-12/17, both hamburger stocks were hit with bad news about "something."
Billions of dollars in stockholder equity is not lost for "no reason."
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- Before the official announcement was made, in that fourteen
day period, McDonalds lost 9.86 percent of its equity, while Wendy's lost
7.22 percent of its value. Insiders were trading on serious information.
That is clear. The Securities and Exchange Commission (SEC) should immediately
launch their own investigation.
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- So, with the worst case scenario for meat producers,
why is it that stock prices for fast food burger companies have recovered
so rapidly? Because meat producers have had enough time to prepare an unprecedented
publicity campaign. Subtle at times, overwhelming at others. Bush went
bird hunting, then > dined on a well publicized steak. Ann Veneman did
the same. Governors and Senators, Congressmena and Mayors, all dined on
beef, proclaiming versions of "it can't happen here." American
consumers swallowed the brainwashing. Hook, line, and stinker.
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- How is Wall Street reacting? The proof is in the (blood)
pudding.
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- Closing Prices January 16, 2004, just 23 days after news
of the first mad cow hit:
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- McDonald's Burgers (MCD) $25.31 (up 5.63%)
- Wendy's Burgers (WEN) $39.49 (up 4.50%)
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- Animal rights activists demand safe conditions for animals.
No more downer cows. Larger living crates. Better feed. Old Chinese proverb:
Be careful what you ask for. Your wish might come true.
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- USDA has both been working hard to insure that America's
meat remains safe to eat. New regulations and laws will be passed. Thanks
to one mad cow and AR activisim, more meat will be eaten. More animals
are to be killed.
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- The American conscience is relieved. Meat is safe to
eat, or so we are told. As Americans become convinced that meat is safe,
more meat will be eaten. Cattlemen are realizing record high prices.
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- So, how's the meat industry doing? They seem to be having
no beef with mad cows.
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- Robert Cohen http://www.notmilk.com > >
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