Take the Herbalife Challenge! Bill Ackman Goes Short, We Guzzle All the Weight-Loss Shake We Can Swallow
The week before Christmas, superstar hedge fund manager Bill Ackman took the stage in a Manhattan auditorium and presented a bold new position: he was shorting shares in Herbalife. You know, the weight-loss aids and nutritional supplements that your Aunt Becky insists are going to make her very thin and very rich one of these days, and maybe you too, if you’d only give them a try.
It was a bravura performance. Mr. Ackman mocked the company’s promises to make its distributors wealthy—“Episodes of MTV Cribs?” he said of a particularly schlocky marketing video—and criticized its efforts to “buy” associations with prominent universities and scientists. That was just for starters. Over the next three hours and 340 slides, he presented his evidence that Herbalife met the Federal Trade Commission’s definition of a pyramid scheme and should be shuttered by the agency. Read More