Business & Finance
Investing

• Small Business Resources:  Census 2000 / Sizing Up the Stats {cont.}

• Investing:  The Visual Market / Who Should Your Broker Be?

• Links to Business Info On-Line:  VT Small Business Resources On-Line {cont.}

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The Visual Market:  Who Should Your Broker Be?

A couple of month back, we ran a piece the SEC's dealings with Jonathan Lebed, the teenager who managed to turn an $8,000 gift from his parents into more than $750k in pretty short order.  ...  {See  Vol. I, No. 7: 2.  Investing:  Net Fraud?  The SEC vs. Jonathan Lebed.}

Whether you consider Lebed a whiz-kid or a small-time {?} stock manipulator is up to you.  But one interesting footnote to the story comes out of the May issue of Harper's.  ...

Anyone familiar with Harper's knows The Harper Index -- that on-going collection of statistical tid-bits that, juxtaposed just so, manage to shed some interesting light on some otherwise complex issues.  It was one such pairing that caught our eye and had us thinking back to Jonathan, his parents, and the SEC, as well as the allegations that were flying about them all.

We had actually mentioned these stats in our article.  Before they appeared in Harper's, they'd appeared in a Bloomberg News Service study, and were subsequently quoted in the N.Y. Times article on the Lebed story.  But when we included them in our own piece, even though we took pains to highlight them appropriately, we didn't think much more about them  ...  until we ran into them again this month. 

At that point, even though they are ridiculously simply, it occurred to us that it might be worth charting them anyway, on the theory that a picture, though not always, can sometimes be worth a thousand words.

Here are the stats:

• On-line whisper numbers were wrong an average of 21% of the time.  ...
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• Professional Wall Street forecasts were wrong an average of 44% of the time.
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Or, put another way.

Difference in Accuracy between Professional Wall St. Analysts Forecasts and Amateur Stock Website Forecasts Early 1999

SOURCE:  Bloomberg News Service.  Most recently appearing in the Harper's Index, May 2001.

Who does your broker listen to?  ...

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Lou Colasanti, Editor & Laura Wisniewski, Associate Editor
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