When watchdogs become lazy hounds

I've always thought that one of the most corrupt professions around is that of stock analyst.

Basically, these clowns get wined and dined by the companies that the analysts are supposed to be critiquing so the likelihood you, the investor, actually gets good information is next to impossible.

Even the ratings they use, (buy, sell, hold) is to be so non-descript as to be meaningless. Seriously, are they recommending a buy because it has upside, or because the the analyst believes that company has an excellent track record for growth, or because other investment opportunities are worse. You could use the same parameters for all the other companies. The ratings don't mean squat.

Now we have an analyst challenging companies earnings reports and he's getting the squeeze.........

For that critique, Mayo has been denied one-on-one meetings with top players of the firm, including CEO Vikram Pandit, Chief Financial Officer John Gerspach, and any other member of management, while other analysts enjoy full access to the bank’s top executives, FBN has learned.

In fact, Mayo hasn’t had a meeting with Pandit or anyone in Citigroup management since around the time of the financial crisis, in the fall of 2008, when Citigroup was on the verge of extinction and needed an unprecedented series of government bailouts to survive.

Since then Citigroup has been profitable, albeit marginally. Though it posted a loss for the full year of 2009, after it repaid a government bailout loan during the fourth quarter and began to unwind Uncle Sam’s ownership stake. One reason Citigroup may be unwilling to write off its DTAs: to do so may sink the troubled bank back into unprofitability.

Now, Mayo’s continued criticism of the firm’s accounting has turned a testy relationship between Pandit and Mayo into one of the most-bitter analyst-CEO confrontations seen on Wall Street for some time. When asked about the matter, a spokeswoman for Citigroup would only say “I have no comment on Mike Mayo.”

Mayo told FBN: “I’d like to know why all my competitors get meetings with Pandit and the key people there and I don’t.”

Why? Try this. These clowns see you getting frozen out and they know they don't get invited to corporate meetings in the Hamptons or South Beach. That's why.

I've never understood why analysts don't rank companies against each other in specific industries.

For instance, if you were to look at large banks you would rank them like you would college football teams with a letter score.

An example might look like.....

1) Nationsbank - A
2) Bank of America - B
3) PNC Bank- C
4) Chase Bank -D
5) Fifth Third Bank - E

In addition, firms would rank industries based on market conditions, long term prospects etc. That might look like.....

1) Transportation - A
2) Medical Devices - B
3) Auto - C
4) Finance - C
5) Food - C
6) Consumer products - D


Then your rating has some weight behind it.

As it is, you'll find out when a company goes down the tubes right after your broker tells you your shares are worthless.

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