Jonathan Weil says Nasdaq warned its investors that things like today's computer failure might happen. Too bad it didn't warn people investing in "financial paper" it manages.
Weil, a business writer I admire, goes a little overboard. The "warnings" are meaningless boilerplate that all SEC-reporting businesses put in their statements. Platoons of first-year associate lawyers brainstorm every thing they think might conceivably happen -- short of a meteorite destroying the earth -- and dump them in.
There is no ranking. The chance of a computer failure (like the earlier failure in Nasdaq's case) is treated as equally likely as a tsunami in New York Harbor.
I have read a number of these warning lists. I have never, ever seen a warning about the most serious threats to the property interests of owners of stock. Real warnings would say things like:
"Our board of directors consists of a boys-club of drones who show up at meetings only to play golf and collect their $265,000 checks."
"The CEO has inappropriate personal contracts with the Corporation, structured so that as the Corporate results decline, he benefits."
"Our business model requires bribing foreign officials and hoping we don't get caught."
"The CFO faked his educational history on his resume. We know it but want to keep him."
"Our management training program consists of giving jobs to the otherwise unemployable children of senior managers."
"The transportation director owns an on-call labor services business, and whenever the Corporation needs temporary help on the loading dock, he brings these workers, who are paid excesssive rates."
"The CEO is a drunk who is incoherent after 11 a.m."
"We are not required by law to take prudent safety measures at our plant, so we don't."
"We have retained a specialist law firm to break the labor unions and lower the morale of our line workers."
"We have no real understanding of the business we are in. We just paid $2 billion to acquire a start-up business with no income. We don't know what this subsidiary does, but there's a lot of buzz about it."
"We are years behind on maintenance of our plant."
"We dump poisonous wastes in the streams and save millions."
None of these is made up.