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FBN's Charlie Gasparino and Charles Payne weigh in on the fight between Herbalife and Bill Ackman.
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The whole crew assembled here to talk about let's from a life story of the nutrition.
Supplement maker it's holding an investor meeting today answers some criticisms that have come up mainly from investor William -- -- -- says he shorting.
The stock because the company operates what is described as a pyramid scheme and those comments helped to lead to the decline we've seen for this particular stock over the last month.
The company's response was hired David -- the famed attorney who among other things represented Al Gore during the 2000 presidential recount.
Now our Charlie Gasparino says are the -- along with the boys is considering legal action he is seated next to.
Mr.
Charles -- to talk about this drama and stock reaction art jump ball his first look.
Just look at a couple of headlines I'll let you go into the boys apparently it is going to be attending this this Herbalife meeting which is -- -- -- -- -- -- interest being I think dynamic here.
Where the company is putting a stake in the ground saying if you mess with us we are gonna come after you I mean you don't go out -- baby -- right.
Unless you who are planning.
Major legal action or at least you know contemplating in a much -- -- gonna do it I sources in -- tell me that they haven't made up their mind but clearly boy he's been at that meeting.
Is putting pressure on bill axes and crackle corals were coming at you know whether factual and I can't tell you I covered act went back during the 2008 -- financial crisis.
He went -- MBIA to bond insurer pretty hard he called them at the time I believe the Ponzi scheme.
Now obviously MBIA was it was involved in some -- you know -- -- business model it was it was insuring subprime debt.
That doesn't mean -- whereupon these aren't so.
All his words are gonna be -- I believe there's a First Amendment issue here can I have an opinion.
That you know company is impairments -- Or is there is there are there restrictions on that when you do with commercial speech and that's what a lot of this is gonna play out in this battle and this battle will only get hotter.
Particularly after this meeting to meetings tomorrow we.
-- of the action stocks strong blow I think your stock goes from -- -- to the twenties and says he certainly per whole Lotta people beyond that I mean beyond that the company to shareholders and so you're right there's going to be a major legal battle there.
He pulled out that the pulled out of 342 page slide slides up at this show why the target on the stock to be zero.
Which by the way is what most shorts are they want people goes short the -- parts orders.
They're never happy you know as I can go from under the -- this still shorter but you know this did to Charlie's point does not the first time to really and -- another company that he took on.
He called the CEO of that company a refugee from a karaoke bar -- it -- like two issues threatening met.
Earlier last year Canadian -- -- is gonna go to nuclear winter when he went to war with them.
This a telephone guys I have -- real problem let's it to some degree with these large hedge fund managers -- Almost get itself -- filling prophecy that goes short these thoughts and he put together these presentations.
It's up at these these shows that people know -- going to be candidate beat the stock up below some more and they get a lot of press forward and -- time to -- this -- the self fulfilling.
Although ultimately you know what he does not necessarily have to want my.
I would just I would just point out that and I agree with some of that that if it wasn't for these guys like -- -- -- -- and David Einhorn who like a return a financial crisis.
That the public would have been stuck with a BS coming out of all the Wall Street firms that you know they their books are fine -- is is just all baloney they'd invested a sub prime debt.
And -- have been investments and you know those guys brought it out the one thing with -- though -- that there's an and we we've exactly c'mon I know bill pretty well.
So don't be afraid -- -- -- c'mon.
And when he was going after MBIA.
You know laugh I spoke I -- a lot with a group.
You don't think he's kind of -- rhetoric he's just.
Name calling -- -- is Einhorn does that I heard that Lehman Brothers speech he gave no way.
You know what he laid the case now but he didn't even call the company name well.
He and you know and even -- there were there were issues with some of the stuff he said I mean they they point out but ultimately he was more much much more right than wrong.
And beyond it was this kind of interest and think I don't think MBIA can be considered a Ponzi scheme I mean MBIA.
Was off a company that for years made -- of money insured municipal bonds they never going to default so you just hear clearly it's quick and dirty money.
Then -- went into this other business of a basically insuring you know sub prime that the big growth area Wall Street now.
You -- you could make a case of any bank is a Ponzi scheme because.
They lend out more money than they actually have at that moment -- -- Tesco or any assurance of that so that's so is that -- MBIA quote unquote in the Bernie Madoff of finance.
But you know he was right about the the notion I mean they were investing in some -- -- dance stuff.
Output was -- its point I looked at a lot of that 342 greats like they believe the name calling if you look at the slide so you say well this -- got a compelling case.
You look at their products vs other consumer goods products in their market capitalization.
In the gross margins of 80% vs forties and for the other names like charge in the white and his or Clorox -- -- while yes something here without necessarily.
Having to go to the next step what is is -- so far though isn't it well I don't know that it is I don't think of the zero stock the idea that you know these multilevel type of -- where.
Most of the time the distributor gets a product and they can't sell and that's how they really make their money we -- thing we should point out that the SEC investigated Herbalife.
But the books they apparently dropped the investigation -- and as a buyer by the way this week that's what a stock is up yet right but but remember they were investigated on a lot of these claims and it looks like what's in the -- wanted to reopen the investigation.
I would just say this you hi David -- You hundred this year but hey I was very very -- -- not -- he's gotten there.
Yeah.
We're told today that the latest today actually it's gonna told go to congress on this -- taxes yet but try Charlie I -- it involved you gotta push.
