Market Perform?

For some time, The Street.com has been an aggressive basher of all things telecom. Jim Cramer's anti-telecom tirades have contributed mightily to the "death spiral" mentality that has afflicted so many industry stocks. But an item that appeared on TheStreet.com this week is so astounding I simply have to pass it along.

It seems that Deutsche Banc Alex. Brown published a report at midday Monday which rated Global Crossing a "market perform." The problem, of course, was that Global Crossing had filed for Chapter 11 bankruptcy several hours earlier. The company's announcement made it clear that its shareholder equity would be wiped out in the reorganization.

I'm sure you'll be shocked (SHOCKED!!) to learn that Deusche Banc was among Global Crossing's underwriters.

In his book "Next," Michael Lewis examined the case of the New Jersey teen who faced SEC charges for an Internet "pump-and-dump" scheme, in which the 14-year-old touted penny stocks and made tons of money selling when the stock price was riding high. Lewis posed an obvious question - how is this any different from what Wall Street has been doing?

The defense has always been that Wall Street analysts have more credibility than a 14-year-old in an Internet chat room. But there's at least one major difference between research reports and the uninformed chatter on the message boards - even Internet touts can still type SELL, even when Wall Street seems to have lost the ability to utter the word.

As for the "market perform" ratings, let's hope the market fares somewhat better than Global Crossing.