ZOMG Twitter IPO !!?!??!

People are very annoyed, or pretending to be, about the fact that the registration statement for Twitter's initial public offering was filed confidentially and will be reviewed by the SEC out of the public eye. The theory seems to be that more disclosure is always better: The more drafts of a registration statement you see, and the more time you have to look at it, the better your decision about whether to invest in the company. Here's Steven Davidoff:

So this theory is not really the theory of U.S. securities regulation. Consider Groupon, which ended up forbidden by the SEC from using certain measures in its prospectus that it had used in its initial registration statement. Specifically, Groupon had used a thing called "adjusted consolidated segment operating income" to make its income sound better than it, strictly speaking, was, and the SEC called shenanigans. No, Groupon, said the SEC, you cannot do that, that is misleading to investors.* Of course, Groupon also disclosed its normal GAAP financial measures; its ACSOI measure was just a bonus piece of additional information for investors. And the SEC said no.