This news broadcast was
very informative as well as educational about what is happening in the business
world today. Listening to this broadcast I had mixed opinions as to who was
right and who was wrong, and after reading some of the comments and going into
further analysis, I believe that both the company of Herbal Life and Bill
Ackman are wrong in this situation. The main idea of this episode is to find
out who is right and who is wrong, whether Herbal Life is a pyramid scheme or
is Bill Ackman just trying to get his name out there even more while earning
billions. Through the facts and evidence in this episode I believe that both
parties are trying to save their name and neither is right.
As the broadcast explained, Herbal Life makes its
profits solely on individual distributors and after that there is no fact of
what goes on from there. A company that has been around for 30 years finally
gets looked into by Bill Ackman and that is when the trouble starts. Bill
Ackman publically held an information session of over 300 slides to the public
explaining how Herbal Life is a scam. Ackman also explains how he spent
millions of dollars collecting information which shows how costly information can
be. At the end of the episode Ackman states that he is “already rich” and just
felt it was “a moral obligation to get it out there.”
Unfortunately this situation is tough to decide
who is right and wrong. I feel like Herbal Life, from what I have heard and seen,
is indeed a pyramid scam, but I also believe that Ackman was not doing a “moral
obligation” more himself a favor. By publically displaying how this company is
a fraud by betting a billion dollars the stock will drop, this instills fear
into the investors to sell out of the company before things get worse. Whatever
side you are on the people in the middle of this situation get hurt. Herbal
Life makes its money off what the newscaster claims to be poor people’s hopes
and dreams encouraging them to go out and advertise and make profits, while
Bill Ackman is betting the stock to go down and scare investors to sell out so
it does indeed drop. Herbal Life will not openly state it is a pyramid scheme
if it is or not and Bill Ackman will not admit he caused this stir just to make
more money. This is a terrible situation in which the investors are the pawns
who don’t win.
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