Free Speech for Me, But Not For Thee

The financial media is in an uproar over proposed new New York Stock Exchange and National Association of Securities Dealers rules that would require stock analysts to stop talking to reporters who didn’t include mandated disclosures when the analyst is quoted in print.

Regulations to rein in “tainted” Wall Street stock research — the very regulations that the media has been hollering for all — year have come back to bite them. The issue is simple. Under new rules put in place this year, stock analysts must disclose their own and their firms conflicts of interests in their reports.

Now the regulators are trying to close a loophole: talking the press is just another way of making research available to the public, so the same disclosure rules apply. The regulators are now saying that if a particular newspaper won’t print the disclosures, then the analyst can’t talk to that newspaper. Is that so different that saying that if a particular printer of research reports refuses to print the disclosures in the footnotes, the analyst has to find another printer?

But to the media it’s nothing less than an assault on the First Amendment. The New York Times‘ Floyd Norris broke the story on Friday with an an apoplectic column, writing,

“If a newspaper won’t print information that the New York Stock Exchange thinks investors should know, then perhaps that paper’s reporters should not be allowed to talk to analysts.