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Kudos to agnostic for Church of Ineffable Stupidity who previously picked up on part of this story:

Most of us for excellent reasons would not point at NewsMax as a prime source.  However, the following item has nothing to do with whether you are liberal or conservative or vegetarian monarchist.

Honesty dictates that I point at the source, to give credit where it is due:

Re: Watson: Secret NSA Deals Cast Doubt on US Stocks (fwd)

Theme: America attracts foreign investment because our financial markets and corporate disclosures are better than other people's.  Not perfect, but better.  American companies have stock market prices based in fair part on reasonable estimates of what the companies are worth.  American companies have incomes based on trust in their products and trust in our liability litigators.

The NSA has wrecked the system six ways from Sunday.

In particular:

All those phone etc companies handed over information from their foreign operations to the NSA, NRO, etc.  These were criminal acts in many of those foreign countries.

There is a significant potential for fines, jail sentences, loss of business licenses, etc etc etc. That immunity law that Congress proved will be used in foreign courts, but only as an admission of guilt.

Foreign companies now have a selling point -- go through us; we are not read by the NSA -- and are working to eliminate through-USA routing of data packets.  It appears that some countries have ordered their internet providers to block routing through the USA.

These and other steps may have a negative effect on the value of the American stocks.

Furthermore, the above are material adverse facts, that were not disclosed to investors.  Litigation or criminal prosecution may ensue.  

Worse, there are reports that some IT company executives were offered immunity from prosecution for their role in the SNA activities, and were stupid enough to accept them.  The implication is that they knew or reasonably suspected that their acts were criminal, which may protect them against jail time, but may not protect them and their companies against security fraud suits, not to mention outraged investors sacking their boards of directors and corporate officers.  If you are a stockholder in one of these firms, I have no idea what your best course of action is.  

It may occur to investors that Google etc may suddenly become worth less than might have been expected.  It may be a time to sell telecomm, IT, etc. stocks before it is too late, or perhaps not.

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