Video Transcript:

what’syour policy? a story by greenburg activist robertchatman battling bill ackman on herbalife. chairman says ackman will lose his fight against herbalife. but he have not the only one who thinks they will lose. watching this battle, in his own words, says it is like watching hedge fund porn. herb, thanks for joir us today. what makes him so interesting in this case is that he is mostly known as a short seller and he is buying the stock even though he agrees with ackman. joins joins us now live in our studios. john, how are shu. i’m pretty well. i got to ask a quick question here. yeah. you’re a short seller and you are — you are long this stock. how does that work? why would you do that? i’m pretty familiar with scumbags. multilevel marketing schemes are scum bags. this million in their chain and bill ackman is ripping them off.tobacco kill twice as many people a year as herbalife. herbalife has in its network. they kill 400,000 people in america. hugely profitable. they are scum bags but return cash to shareholders for decades. if you have shorted them, you’ve been run over.herbalife, five years ago, add about 400 million shares, it nowhas 108 million shares. it buys back stock regularly. payes a fairly hefty dividend. they are a scum bags but have a stock market scum bag. you have to be careful with what you say here. the question is, will the ftc go after the company? one reason you don’t believe that ackman will be right is because you don’t believe the fdc will do that. you say something obviously wrong and you think the government will rescue you.all herbalife needs to do is find somebody who was fat and isless fat because of herbalife and somewhere in the 2.5 milliondistributors there will be a few of those. wheel them out in front of them, and you are know, what bill ackman’s case now is that the government’s going to go and billionaire hedge fundmanager. i know another hedge fund manager here john, and he is very politically connected, very short the stock, and he believes that the heat will get turned up on this industry very quickly here. and he believes that one of the things they will be looking at is the industry itself targeting lower income what is to say that even though the ftc didn’t do this before, they don’t come back and do it now. i believe the same thingabout the tobacco companies 20 years ago. the ftc has known about multilevel marketing schemes for decades. if this last three years, ackman is wrong. if it lasts a decade, ackman isso wrong, it’s just silly. now this thing really has cash flow. a thesis that says, i got to wait for government is bad thesis. i don’t know how many really dodgy companies i’ve reported tothe fcc and what do they do? sometimes they fine them. the vast bulk of the time they don’t. herb, i’m wondering where we go from here. i know we are looking forward to herbalife’s rebuttal and ackman is preparing his rebuttal to that rebuttal. what is the next chapter in the story. the this does become theequivalent of the for profit education industry where they go after it and where the industry, people said, they will never go after that industry. the government went after that and in this case you end up with a very hard reset of the business models of thesecompanies. and for profit education industry case the victim is at least in part the government. the government giving stupidloans. a relatively easy way of the government reducing thefiscal — john, if in it case the victim is lower income population, a lot of lower income population and obama administration could be very interested in that, wouldn’t that potentially have an impact? when did the government care about lowering people that way? lower income people are largely the victims of tobacco companies too. you look at tobacco, it is completely inversely correlated to wealth and income. rich people don’t smoke. poor people smoke. people in most jurisdictions just raise taxes from that. okay, we will see. we will see who is correct on this one. john, thank you very much for coming along.