The New York Times has a front-page news article about the Daniel Loeb versus William Ackman faceoff over Herbalife that was covered here yesterday. It's instructive:
In the end, the short-seller had a bold prediction: federal regulators would eventually shut down the company...."While the short-seller's presentation was lengthy, it presented no evidence to show that Herbalife has crossed a line that would compel regulators to shut it down," Mr. Loeb wrote, taking a shot at Mr. Ackman.
The investment proposition here, in other words, is almost dependent less on what you think the company is going to do than on what you think the regulators are going to do. It's an interesting situation, and certainly one that underscores the need for regulators who are impartial.