Not just you would’ve reported it, most mainstream would’ve if they saw it too. It was only this week that they were quoting whitehouse.org instead of .gov on Jerry Falwell’s death.

I think they (and you) have no need to defend your professionalism, just maintain it. April Fool’s jokes aside I’d thing you guys could put your reporting up against most any mainstream outlet and come out great, which is why people read you.

Kewtr, you’ve been very pleasant lately. What’s wrong?

Clarifying — my confusing misuse of two different ‘they’ above — I think most decent bloggers take their reporting every bit as seriously as the mainstream.

We can probably expect to see this type of activity increasing in the future, stockhacking.

I think Engadget did the right thing by reporting this news…that’s what they do report breaking news about technology…that’s what makes visiting their website exciting…I think

“Many investors had lost a staggering amount of money in the amount of time it takes to brush your teeth.”

Alright Michael, lets not blow this out of proportion - you seem to have a knack on making these kind of sensationalist statements eh?

The amount that was lost was $5 off of $107, a measely (although not insignificant) 5%. Sure investors in aggregate lost a “staggering amount of money”, but I’d bet the average Apple stock holder barely felt the pinch.

engadget possibly enabled some bad actors to make in $$s from innocent people more than engadget has made in revenue over their entire history! And they just basically say that if the same thing happens again, they’d make the same mistake again? wtf?

If engadget has no connections inside apple that could have privately confirmed or denied the story then why, exactly, are they so widely read .. and do they deserve to be?

Perhaps real journalists would NOT have been so easily tricked. Perhaps this IS a problem with blogs operating without any real accountability or standards, just operating, digg style, for maximum page views.

Wow. If you are a well-heeled crook, who could afford to short the stock, and cover your tracks with the SEC, you could have made millions, possibly tens of millions, with this maneuver. Actually, knowing that it was a hoax, it would be smarter to have gone long after the dip, that way you would avoid suspicion, as long as you weren’t too greedy.

But these scams only work really well the first few times. Now, traders will think twice before dumping a stock based on unconfirmed blog posts, in the same way they stopped believing all the “pump and dump” posts in online forums.

I think we’ve just witnessed a dangerous evolution of phishing attacks.

Email headers are easy to forge. Find the right distribution list, craft the right message and wait for it to filter to news outlets.

Tier 1 blogs are just like regular news outlets, just far more responsive.

Hey Michael,

Can you prove that people lost a lot of money?

Regards,
TSW

The speed at which fiction spreads, particularly when people relish the misfortune of others, is much greater than the speed at which clear thinking occurs in the brains of news writers. It’s more fun to have a juicy story than to spoil it by digging (not the website) for the truth. The writer has some responsibility to validate the story. I suppose if it seems very important then they should at least run it with a bushel of disclaimers. Why write the truth when lies are easier to make up?

I’m just going to start hanging around with Ryan at coffee shops and short stocks as he blogs them.

Cha ching.

Michael - you know little about the stock market. Only those people that sold on the noise lost money. Those people that were looking at the price every evening like 99 percent of people do, saw nothing and lost nothing.

This crap happens hundreds of times a day. Only because it is apple and it is engadget do you think it is now important.

Feeding stories to cnbc, wallsstreet jornal and other media from stock promoters has happened forever. Watch wall street the movie.

The e-mail was sent as a cover-up for stock price manipulation.

Money manager sends a bogus e-mail from an off-shore / proxy, etc.. once it’s found online, the fund can dump millions of shares, setting off auto-sell filters, therein causing a meltdown..

this allows the fund and their cohorts to get back in at a lower price before the truth is found out.

In the unlikely case that SEC investigates why said fund sold their position, they can simply point to Engadget and say.. “see.. that made us do it!”

Let’s start by saying that Mike supports Ryan so that Ryan will support Mike when Mike posts things like this. Same thing with Truemors, everyone has said its crap yet Mike gave a flat review with no pro/con cuz Guy is a big name.

The Apple email may have been solid gold but when something is too unbelievable, it is too unbelievable. Stand up and say you f’ed up. Happens to all of us. Instead of excuses. Ryan seems to be truthful in his accounts but the email should have started with, I f’ed up. But again, no one remembers who came in 2nd in the olympics.

Email comes in, the phone should be ringing to the person who is named on the email. Receive confirmation then post.

Roger #11 you are right, the writer does have a responsibility to validate the story.

Yet read the comments on engadget. No one cares that Ryan did something wrong. The internet does not have a memory. It’s like that over and over. Same thing here as well. I don’t get it frankly. Remember Digg from last week? Surely blogs like this one said it was the end for Digg yet this week it’s bigger than ever.

Will the SEC investigate? Who knows. Stockphising sounds like an interesting term.

Lets see, in one fell swoop there’s an opportunity to make a quick chunk of cash while simultaneously undermining the credibility of an esteemed blogger… by one well placed email…I’d say that was a good day for Steve.

Any investor who trusts rumor sites like engadget get what they deserve.

come on michael or duncan come up with some good stuff ie: buyouts and new stuff “applegate,” is boring besides being a historical footnote for bloggers…..

Bobby,

The sale / price manipulation was already pre-planned.. all they needed was an alibi if and when SEC investigates.

Engadget was just a helpless and unlucky bystander.

“The thing about money, is it makes us do things we don’t want to do.”

“I have to say that I, too, would have posted this news based on the source. The email was in fact sent from Apple’s email server to Apple employees and was then forwarded to Engadget from a trusted source. Ryan says ‘For a reporter, this kind of thing — an internal memo to a company’s employees — is solid gold’ and I agree. This was almost as good as a formally issued press release.”

No way, Mike. We readers can’t check what you’re telling us. All we know is that you feel it’s solid, but you don’t provide us readers a way to check you.

“Official sources say” is a very, very bad piece of manipulation. Show us the goods, let us check the news ourselves.

jd

Rumors used to get started on the trading floor before it all went electronic trigger happy so who is really to blame here - electronic sell/buy triggers that only operate as if price fluctuations are the only basis to make a judgment call on sell or buy? Who is to blame if you trade on the memo OR if your systems are triggered to sell when Apple gets to 101.00 regardless of the reason - maybe some systems need to be smarter?

As for the source of the memo - I’m not blaming Engadget but the IP address can be spoofed so it’s not that Apple’s servers were hacked so before we blame Apple for allowing it be “hacked,” let’s not presume it was hacked as clearly there are other ways to make it look like it came from Apple … then the bigger question is who had short positions on Apple and do we feel comfortable in thinking it wasn’t from them? Since shortsellers of Apple stock have pretty eaten it in the shorts for 3 years, maybe they needed a day to get something back?

Yea, I’m not really inclined to blame Engadget, they got an email the researched seem to indicate it’s from Apple - Apple probably wouldn’t respond if you asked if Steve Jobs was hit by an AMD sign so it seems normal. If you are the Kremlin, you have to take the good with the bad.

And as others point out, if you invest by Engadget or by lock stepping into price points, you might want to revise your strategy.

Wow. Thats crazy.

Exactly:

“I’m not sure we (bloggers) understood quite how much influence we really had until yesterday. “AppleGate” will become an important historical footnote for the development of blogs and the evolution of the news and editorial business more generally”

This is what I meant with “a big day for blogs” in my previous comment. Hope Engadget won’t get hurt by this, though.

With a leveraged derivative someone could have made out a hell of a lot better than shorting the stock — a change like that in volatility has pretty serious implications in the price of related options. For example, QAAQA.X, worth $0.05, went to $0.20 with a decent volume — could have earned a 4x return on your investment.

Sounds like Apple was flushing out a canary. Send out a few dozen slightly different company-wide emails and see which version hits the wires. Do it a few times and you get quadratic convergence on the internal leaker.

Michael - Good topic to expand on.

What if somebody hacks into Engadget or Techcrunch and posts bogus news like that? We are talking just few minutes to cause massive impact.

Going forward blog platform security will be a major issue as well. Some of this is applicable to mainstream digital media platform as well but blogging really squeezes the time window here.

I think Trevo is absolutely correct. This didn’t really affect many stockholders.

Firstly saying $4billion wiped off is meaningless, it has to be expressed as a percentage of the market cap.
Second how much volume was actually traded during that time? Investors would only have taken a hit selling during that 20 mins. There would not have been many trades executed as the stock plunged. Looking at the severity of the fall, it looks like aggressive traders took short positions instantly on seeing the news then had to scramble to cover their short by buying back, if so then hardly any retail investors would have been affected.

The average non-pro investor would only have read about this at the end of the day.

Who cares about this?
If you bought Apple stock for the long term, then yesterday’s fluctuations are meaningless.
If you are a day trader in Apple stock, then I hope you got screwed.

I agree. If I were a trader, I’d be pretty upset myself…

http://www.capitalai.com/blog/.....ess-ideas/

I, for one agree with the illustrious FS:

“I know what you’re thinking. Was this one of those fake Apple leaks where we try to put a stick in some poor blogger’s spokes? Would Apple really resort to something as evil as this? Would we really still harbor a grudge from months ago when Veronica Belmont ripped me and said the Toshiba Gigabeat was better than the iPod? And would we get back at her by trying to get her boyfriend fired from his job? Come on. You know we would.”

;]

Thanks for the intelligent insight into the pressosphere. I, for one, wouldn’t consider an internal memo nearly as “solid gold” in comparison to a PR. A PR is an absolute official statement, where as an internal memo is not considered public consumption, from the company’s stand point.

I wonder if, instead of Apple, the victim company was Nokia, Sony Ericsson, Motorla or any other company in the world. Nobody would be creating the stir some fanboys are creating against Engadget.

It wasn’t only on Engadget: I also found it on yahoo biz at http://biz.yahoo.com/bw/070516......html?.v=1
didier

Engadget shouldn’t have gotten a clue, once they realized that the supposed e-mail was mailed before normal business hours. It was still before business hours when they “tried” to verify the story.

They should also have realized that that sort of e-mail is always sent to employees AFTER the press release, and never before the press release. If that were not the case, then Apple wouldn’t have received their recent clean bill of health from the SEC.

Unfortunately, Engadget refuses to admit that they were fooled. They continue to claim they did the right thing under the circumstances.

So what can we readers do, except expect more of the same from Engadget?

I dont think the whole “4 billion cap lost” is very significant. Nobody lost a lot of money on this at all, all stocks go up and down.

dip $4B and recover in 20 minutes…now that is a fast market !

> Ryan says “For a reporter, this kind of thing — an internal memo to a company’s employees — is solid gold” and I agree

Right. In professional journalism, secondary or alternate sources are often used to back up what one source says. Ryan calls himself a reporter and that, in the loosest sense, is exactly what he was - he heard and repeated. It’s gossip, not news, and anyone willing to buy and sell stock in gossip tends to end up looking silly.

I am with Todd on this one.

I commend Ryan for posting an apology, it was the correct thing to do, and hopefully he did not lose his job because of this incident. If AOL was smart, they would use what happened as a case study, and maybe re-evaluate how Engadget reports on the news. Engadget is a massive site, and with so much SOV in this space, it’s probably time to sit down and put some “real” journalism guidelines into place so this doesn’t happen again.

I am not sure if anyone at Engadget has heard of the Society of Professional Journalists, but it would be a good exercise to read their code of ethics. These are good rules to abide by if you want to build reader trust and credibility among your peers.

http://www.spj.org/ethicscode.asp

- Seek Truth and Report It (biggie right here)
- Minimize Harm
- Act Independently
- Be Accountable

What an interesting post. I hadn’t looked at it this way but it’s true. Very cool.

I agree that Apple’s slow response caused the problem. Poor engadget!

As I’ve said before, news is what has happened. Engadget reported something that hadn’t happened: there was no delay in Apple’s new product schedule. Apple servers, internal emails and why Engadget got it wrong are all irrelevant as far as readers are concerned. Ryan Block should have picked up the telephone and spoken to Apple’s PR. It wouldn’t surprise me if this turns out to be a PR strategy to reduce the influence of blogs, trash their reputation, lower rates for advertising on blogs, generally get rid of the PR headache that is bloggers (the good ones at least).

Yet another crazy story for the Apple history books…

I agree Engadget wasn’t in the wrong, they may of had an itchy trigger finger but can you blame them on a story like this?

engadget to lose credibility over this? i don’t think so, just imagine when some mainstream news media reports on the story, it will make engadget even more popular….actually, engadget just did a fever for the blogsphere as a whole as it has just comfirmed in a way that blogging is in the mainstream news media!

No matter you are a short-term trader or invest for the long-term it is normally considered wise to insert stop-loss rules in your system. So many funds (which are usually protected by common-sense rules) was probably hit. Less so private traders.

Engadget (and apparantly this site would have done the same) showed their lack of business knowledge and inexperience. This kind of information would *never* be sent just to internal mailing lists to all emplyees - it is *required* (by SEC) to immediately be made public.

So the fact that there was no press-release told anyone the “leaked” email was something else. Engadget might have reported on it if they felt the itch but should have warned readers that it (with very high probability) was false information.

Unfortunately companies like Apple are the easiest targets for stock-price manipulation with disinformation, considering their stocks value is largely inflated by impulsive amateur investors.

Considering this company is so bullish its could be called a Fisher Price’s “My First Stock Pick” . Im not surprised it was the target of this. And I hope at least the hackers responsible shorted some AAPL before pulling this stunt.

Or maybe I’m totally wrong and there is absolutely no lesson to be learned here.

They have to delay a lot of products, lately. I was also passionately waiting for OSX. Well, we will just have to wait, but hopefully not too long. Because then I might look elsewhere.

Never heard of engadget before this happened!!!!!!

Well, engadget should check it’s sources, don’t you think ? I’d rather call it engadgetgate….

I’m sure Apple PR was in the dark regarding iPhone since Apple is so secretive. How about Microsoft-Yahoo!-gate when The New York Post reported (false) rumors about Yahoo!’s possible acquisition by Microsoft? I lot of short sellers could have lost a lot of money…

This post is 100% on the nail. Any journalist in Ryan’s situation would have done exactly what he did - especially given Apple PR’s reknowned lack of care in dealing with anyone other than the WSJ or NYT. Interesting post here:

http://www.theinquirer.net/def.....icle=39688

On how Apple effectively brought this on themselves.

I for one trust Engadget more after this incident, not less. The transparency in editorial decision making etc - all good stuff.

I don’t see Engadget as a “blog” any more. When you’re audience is that big every media format has that influence. It’s just that those people are reading it for the right reasons.

If Engadget wasn’t good and nobody read it, this wouldn’t have happened. If CNN wasn’t good and nobody saw it, I wouldn’t care if they broke a story like that, either.