Sense on Cents

When an executive is in a position of recommending takeovers to perhaps the most legendary business executive on the planet, what is he doing purchasing a sizable position in that stock a week before making that recommendation? Are Americans still supposed to believe the manner in which markets operate and corporate takeovers occur are fully on the up and up? Stop it.

David Sokol can attempt to explain away his personal trading of Lubrizol stock during the month of December but his purchase of close to 100,000 shares (a dollar commitment of more than $9 million) in early January and less than ten days before broaching the topic to Warren Buffet that Berkshire Hathaway purchase the company SMELLS.

Sokol’s unexpected resignation, Buffett’s quick defense of his highly regarded colleague, and Sokol’s appearance on a morning business show strike me as a totally scripted and managed defense. Who in Washington will take the other side of the argument and say, “well, just hold on a second here, gentlemen. There is a lot of smoke around this campfire. While you may care to douse it with some cold water, those in America who care about pursuing truth, transparency, and integrity in our markets, would like a full accounting of all conversations and meetings on this topic.”

Will Mr. Buffett’s relationship with the current administration along with his elevated position and status negate a regulatory investigation? Will a mere resignation by Mr. Sokol be the end of this? Should all the personal trading records of Mr. Sokol be pulled and reviewed? Has this happened previously? What about the personal trading activity of other executives at other Berkshire subsidiaries?

If David Sokol, working for Warren Buffett, did not purchase the stock in Lubrizol but Raj Rajaratnam did, what would people think? Would Raj be treated in a similar manner?

Let’s get the full accounting and entire truth from an INDEPENDENT regulatory entity and then determine the rectitude of Mr. Sokol and Mr. Buffett.

Thoughts, comments, constructive criticism always encouraged and appreciated.

Larry Doyle

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I have no affiliation or business interest with any entity referenced in this commentary. The opinions expressed are my own. I am a proponent of real transparency within our markets so that investor confidence and investor protection can be achieved.

This entry was posted on Thursday, March 31st, 2011 at 10:53 AM and is filed under General. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.