Need an explanation of the perils of “sockpuppets?” Read this page one in the WSJ. The CEO of Whole Foods (aka “Whole Paycheck”) logs onto the Yahoo finance forum for the Whole Foods stock and posts for years under a pseudonym, trashing the competition’s stock and praising his own haircut. WTF?
“In January 2005, someone using the name “Rahodeb” went online to a Yahoo stock-market forum and posted this opinion: No company would want to buy Wild Oats Markets Inc., a natural-foods grocer, at its price then of about $8 a share.”Would Whole Foods buy OATS?” Rahodeb asked, using Wild Oats’ stock symbol. “Almost surely not at current prices. What would they gain? OATS locations are too small.” Rahodeb speculated that Wild Oats eventually would be sold after sliding into bankruptcy or when its stock fell below $5. A month later, Rahodeb wrote that Wild Oats management “clearly doesn’t know what it is doing …. OATS has no value and no future.”
The comments were typical of banter on Internet message boards for stocks, but the writer’s identity was anything but. Rahodeb was an online pseudonym of John Mackey, co-founder and chief executive of Whole Foods Market Inc. [emphasis mine, .ed] Earlier this year, his company agreed to buy Wild Oats for $565 million, or $18.50 a share.”