for more information contact firstname.lastname@example.org
|I Am Skooter|
So here's us, on the raggedy edge.
Northern Telecom is laying off 3,500 workers - again. Is there an end in sight for this company?
I dumped my Nortel stock a while ago; I will confess to having a little sympathy for those who didn’t, and for those who bought it at $69 or so even when every (and I do mean every) respectable fund manager was calling it overvalued at that point in its long slide. I paid about $24 for my most expensive batch, and at the time it seemed like a not unreasonable call.
Nortel is firing 7 employees from its accounting division; I’m fairly amazed that the Canadian press which so quickly skewered Enron for its accounting fraud, is going so lightly on Nortel. This was our stock market darling - the largest company (by valuation) on the TSE for a time. Maybe it wouldn’t be good for business? That, of course, is the business of the TSE not the the business of Nortel.
What’s equally amazing is how this fraud was able to be perpetrated for so long at one of Canada’s most widely held companies without any mutual fund managers knowing about it. I can understand at the individual investor level - if you’ve thrown your thousand dollars into it, you’re likely just along for the ride and aren’t going to have the time, inclination or ability to dig into the financials to uncover anything of this scope.
Your Professional Mutual Fund manager though is supposed to do this for you. There’s no way this should have slipped past these guys - they get paid good money to manage your money, and you’re the person paying them. If the guy managing your mutual fund doesn’t know that he’s dumping money into a sinkhole, how can you really trust him?
I don’t have a solution here - not a magic one anyway - and the problem here may in fact be that the fraud was so well perpetrated that nobody on the outside could have penetrated it. I have trouble believing this; 9 people have been fired directly as a result of this so far, and that’s a pretty big consipracy.
But I intend to demand better from my mutual funds in the future, and I hope you do to.