People lost money thanks to Brian Ross moving the market with his false reporting. He’s been suspended, but will we see lawsuits against him and ABC on behalf of investors who lost money?

Update: as this was being published, President Trump just recommended they do so -- on Twitter (of course):

People who lost money when the Stock Market went down 350 points based on the False and Dishonest reporting of Brian Ross of @ABC News (he has been suspended), should consider hiring a lawyer and suing ABC for the damages this bad reporting has caused - many millions of dollars!

— Donald J. Trump (@realDonaldTrump) December 3, 2017

For background, here is what happened, via Streiff at  Red State:

ABC news ran a story that clearly implied that, before November 8, 2017, Donald Trump had ordered Michael Flynn to contact the Russians for some unknown purpose. The purpose was hinted at as being nefarious as, according to the story, Flynn was going to squeal to Mueller about it.

This was not just any story. The Dow Jones noticed immediately, dropping 300 points following the time this story aired.

The rebound occurred after Senator McCain expressed his support for the Senate tax cut bill. But the brief decline was serious, and cost some investors money.  

Broadly speaking, there are people whose stock sales coincided with the market crash, who got a lower price. They could conceivably make a claim, with a probability of success that is beyond me to assess.  But there are others who could have been harmed. Ed Lasky tells me that with defensive sell stop loss orders not far below the current price, people would have had their positions sold. Liquidity dried up and air pockets developed so some stocks fell disproportionally harder than the market as a whole. People who wanted re-establish long term holdings whose sales were triggered by stop loss orders could have had losses on the order of 2%

It could have been far worse if the good news of the Senate tax bill had not triggered a rebound.  If the fall had continued, more stop loss sales could have been triggered, and sometimes cascades begin.  Joh McCain short circuited any possibility of that.

My guess is that the SEC always looks for suspicious patterns of transactions when markets are rocked by news. But I would be very surprised if anyone had prior news of Ross’s fake news. This was political bias not greed.

However, as a friend points out, now that we have established that the Mueller investigation can move markets, Robert Mueller should require all of his staff to put their stock holdings (including retirement funds) into blind trusts. If any of them were so foolish as to sell shares of anything right before an indictment of, say, Jared Kushner, they would face legal consequences beyond firing.

Most delicious of all: an explosion of class action lawsuits would pit leftists (the tort lawyers) against leftists (ABC). When movements collapse, infighting develops.

Heh, heh, heh.