Blue Chip Investing: Transparent Incompetence
By Adam Lass
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In this article:
Wal-Mart concedes that it does spy on employees and dissident groups.
Is this the proper behavior of a modern corporation or the last gasp of incompetent management?
Wal-Mart is stuck between the trade war with China and rising oil prices.
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Blue Chip Investing: Transparent Incompetence
If anyone is in a position to know what is going on at the headquarters of the biggest player in retailing, it’s their corporate spy, Bruce Gabbard. Except he’s been not talking since they fired him for recording phone calls and intercepting pager messages.
He did confirm (via cell phone text message to the AP: how modern!) most of the stories floating about of late concerning the glass-walled “Threat Research and Analysis Group,” which supposedly has operational capacities that would turn many a second-tier secret police service green with envy.
While they were progressive enough to fire Gabbard after they lost any semblance of plausible deniability, Wal-Mart management defends much of the center’s activities, claiming that “like most major corporations, it is our corporate responsibility to have systems in place, including software systems, to monitor threats to our network, intellectual property and our people.”
Blue Chip Investing: Bentonville’s secret police
Apparently, this includes monitoring private e-mail conversations on outside networks, and sending spies to monitor dissident groups that might dare to speak out during shareholder meetings.
Now one could say that this is simply the behavior of a modern international corporation. After all, they have done nothing too terribly different that that which was accorded to, say, Hewlett Packard.
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On the other hand, the creation of secret services to compile lists of and spy on perceived “enemies” is usually the last sign of desperation, whether it is a third world despot with 1,700% inflation or a corporation desperate to deflect attention from management as transparently bad as the walls of Wal-Mart’s “threat” center.
Blue Chip Investing: Sell WMT now
As Nu Wexler, spokesman for Wal-Mart Watch put it upon learning of the company’s possession of personal photos and their plans to shadow him prior to Wal-Mart’s annual meeting: “They should stop playing with spy toys and take the criticism of their business model seriously. The success of the company depends on it.”
Then again, perhaps the company would be best served by a clean sweep of upper management. And even that may not do the trick, seeing as how the big W is now caught between an international trade war that could dramatically increase their costs and shrinking gross sales as oil costs rob their customer base of disposable income.
Tell you what: just short Wal-Mart now, and don’t worry about it.
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Adam Lass is the founder and manager of the WaveStrength Group, and is a contributing editor for Taipan Financial News. As the creator of WaveStrength’s proprietary analysis system, Adam’s expertise has shaped a franchise of successful investment newsletters and services, including WaveStrength Options Weekly and WaveStrength Apex.
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