The battle of word between Herbalife CEO Michael Johnson, who audaciously claims he's shocked...shocked...to have heard for the first time ever the Multi Level Marketing is shady and often associated with scams....and two dueling hedge fund titans continues to play out. Tracy Coenen has some of the latest coverage, including videos, on her Fraud Files Blog.
As a longtime critic of MLM, I find it interesting that while three wealthy bastards debate whether a huge corporate is a good investment or not....the public is finally hearding more about the dark side of MLM. In my book, whether Herbalife stock will crash or thrive is pretty irrelevant. What IS relevant...extremely relevant...is that Multi Level Marketing in general provides a vehicle for victimization of millions of people per year, at a cost of billions of dollars to mostly poor and middle class Americans. And this is not to mention the fact that MLM is even less regulated, and even more destructive, to the lives of hundreds of millions of people worldwide.
"Victimization?" you may say?....."isn't that a strong word?" Yes it is, and I acknowledge that some people suffer more than others due to the existense of MLM stuff in their lives. But honestly, if you look at the reality of the situation, the BEST CASE SCENARIO with MLM is that people pressure friends, neighbors, and loved ones to do something that is aganst their best interests, by pretending it is a good idea, in a desparate effort to monetize those relationships. That's best case scenario when it comes to MLM.
From there it gets worse....including people who never make a dime, but end up losing money bc they aren't that good at pressurinig their family to buy overpriced stuff they don't need. And then of course people who are scammed altogether...there is a VERY small line between MLM and pyramid schemes..
I hope the MLM story gets more people to look at those near to them and ask: what is he involved in, and is it really a good idea? What is she trying to sell me, and what are her motivations? Is this all such a good idea?
