If Howard Lindzon is right, Wall Street pros are more likely to be pumping their fists in the air than turning to each other for hugs amid bombshell news that Eliot Spitzer, governor of New York and one-time crusader against corruption big and small, could be involved in a prostitution ring.
“The guy has been dishing it out for years now, with quite a heavy hand. It’s called karma and I am a very strong believer in it,” said Mr. Lindzon, who is an investment adviser and blogger. “Welcome to the karma frying pan Mr. Spitzer. Lot’s of people were willing this and you made their day.”
No word yet from Mr. Lindzon on the ideal karma trade. Those that suffered most from his heavy-handedness though, a long list that includes the insurance and mutual funds industries, could be in line for a little karma-based rebound, in theory at least. Alas, the S&P 500 was down on Monday afternoon and the insurance industry was down with it. Gold, the anti-Spitzer trade because it is a bet against the U.S. dollar, was also down slightly, at $971.80 (U.S.) an ounce.
Maybe the best way to play the Spitzer news is with an investment in sleaze itself. Playboy Enterprises Inc. fell to $7.77 in late afternoon trading, down 12 cents, so clearly this is a longer term investment. Or maybe investors are using a wider definition of sleaze, incorporating things like gambling and booze: The FocusShares ISE SINdex fund,an exchange traded fund that invests in a number of no-no stocks, rose 1 per cent on Monday, to $37.75.
