Martha Stewart---Allan (slow)
Interview: Bullish on the Russian market
John Chisholm---Co-chief Investment Officer---Arcadian Asset Management
>> the question whether the defendants will testify in the martha stewart case has an answer. allan dodds frank has been attending the trial and has details. take it away, answer-man.
>> neither martha stewart nor peter bacanovic, her former merrill lynch broker and co-defendant, will be testifying in their own defense. we learned that martha stewart will not testify. her defense will only put on one witness, a lawyer named steven pearl who took notes at a meeting she had with government investigators in february of 2002. his notes are different from the government notes.% let’s talk about bacanovic for a minute. he’s not going to take the stand and his spokesman told me that bacanovic’s testimony is unnecessary because it’s a circumstantial case and we don’t think the prosecution has proved it. bacanovic’s defense put on only five witnesses and the one on the stand the longest was heidi deluca, business manager for stewart. bacanovic ‘s lawyers attempted to have her reinforce her testimony from yesterday when she said she and bacanovic talked about the need to set a floor price of $60 to $61 for stewart to sell imclone stock. deluca said that conversation took place november 8, 2001, a story she stuck to today. during cross examination, prosecutor produced evidence the government says the conversation took place 15 days earlier for a totally different reason. schachter tried to show that deluca’s conversation with bacanovic occurred at a different date and related to a separate sale of imclone shares from her company’s pension fund account. at the time, the 3,928 imclone shares in stewart’s personal portfolio were held in an account at morgan stanley, not merrill lynch. schachter said the call was 21 minutes long and in the middle of it, the price was that that was written on the document by deluca. the prosecution said there was decided at the time of the call, not a prearranged floor price. stewart stuck to her story that the notation came out of a november 8th notation with bacanovic. deluca also stuck to a story regarding a discussion about imclone. martha to heidi -- the last witness for bacanovic was a former stockbroker, now an expert securities witness, john maine and testified to the volume of imclone stock on the day stewart sold was nearly double what it had been in previous days and the stock price opened down sharply in the first hours of trading, paving the way for the defense to argue that stewart sold her stock because of the volatility and their prearrangement.
>> allan, thank you very much. we’ll follow this as it develops. our next guest invests in russian stocks and says despite today’s news about the russian government being fired by vladimir putin, he is still bullish on the russian market in general. john chisholm is co-chief investment officer at arcadian asset management and joins us from our boston studios. you had previously told us or earlier told us that this is one of those bumps in the road that emerging market investors have to face. so in other words, these declines in markets and these bumps are an opportunity to buy stock, is that still true?
>> i believe it is, yes. i think this is just a political issue that won’t have a major long-term effect on the pay-off investors get from the russian equity market or emerging markets in general.
>> if we look, you said you were surprised by the move today and the timing of it. other analysts we spoke to said they saw it coming and even president putin himself said it’s the right time to do it, before the election. why were you so surprised?
>> well, we knew that mikhail kasyanov was not popular with putin so it was likely something would happen at some point. the timing was something that i did not have a good idea of whether that would come before or after the election. the key point, though, is that this doesn’t indicate an increase in the risk that the russian market is delivering right now. in other words, the russian market hasn’t suddenly become much riskier. i think this is an event that’s par for the course for investing in russia and doesn’t represent major new news that impacts investors.
>> we have 20 seconds left, john.the market there, the russian index down 1.4%, hardly a widescale selloff.
>> it wasn’t a big selloff, i don’t think. russian market bounces up and down more than that most days.
>> we leave it there, thank you very much, john chisholm from akkadian asset management. still more news coming up after the break. we’ll talk to the c.e.o. of guidant about their latest developments with heart stents.
