What Is Investment Research?

I was reading the NY Times business section today and came across this paragraph in a story about the potential collapse of bond insurers.

Mr. Ackman, who runs a New York hedge fund called Pershing Square and
has bet against the insurers’ shares, issued a report late in the
afternoon predicting that two of the companies, MBIA and the Ambac Financial Group,
might lose $24 billion on complex mortgage investments they have
guaranteed. Such a hole might threaten their survival and touch off a
chain reaction of losses at some of Wall Street’s biggest banks, as
well as raise borrowing costs for states and municipalities.

William Ackman is a well known hedge fund manager and he’s been short these stocks, and has made a lot of money on those short positions. So his "report" on them is interesting to me. Why? Because he’s got a lot at stake.

In the wake of Sarbanes Oxley and Reg FD we’ve gotten broker-based research that is so bland and uninformed that it’s basically useless. The action has moved to the people who actually have positions.

Stock blogs are certainly a big part of this phenomenon and I read a bunch of them daily. But so are these "reports" that big hedge funds are putting out basically touting their positions.

How do I find Ackman’s report? He doesn’t have a blog, at least I couldn’t find it with a Google search. I did a blog search and found a link to this CNBC story. It looks like Ackman’s report was actually a letter sent to the SEC and insurance regulators.

I funded the startup of Multex 15 years ago and watched the internet and technology streamline the distribution of broker research. That is now a $200-500mm annual revenue business depending on how you measure it.

Is there an opportunity to go beyond the brokers and out into the internet to find the more relevant "research". I think so.

UPDATE: Here is Ackman’s letter in pdf format.