Live on Bloomberg TV

00:00CENTRALLY ASIA, THAT IT HAS SOME PROBLEMS. BUT THE PROBLEMS ARE ACTUALLY FAR WORSE THAT INVESTORS SEEMED UNDERSTAND. THIS RELATES TO WIDESPREAD CORRUPTION THAT HAS OCCURRED IN PRETTY MUCH EVERY SINGLE ONE OF ITS MARKETS, WHICH WAS OPERATING IN CENTRAL ASIA. FRANCINE: DO YOU HAVE EVIDENCE TO BACK THAT UP? WE HAVE SPOKEN TO THE SPOKESPERSON -- HE SAYS THEY ARE TRYING TO BE AS OPEN AND TRANSPARENT AS THEY CAN ON ALL ISSUES. CARSON: I TAKE ISSUE WITH THAT. THAT IS PART OF THE THESIS HERE. TELIA, I PRESUME, HAS MUCH BETTER INFORMATION ABOUT WHAT HAS TRANSPIRED THEN IT IS GIVEN THE MARKETS. FRANCINE: YOU HAVE EVIDENCE FOR THIS? CARSON: WE HAVE A LIST OF PAYMENTS THAT WERE MADE IN NUMEROUS COUNTRIES, THAT IN MANY WAYS MAKE NO COMMERCIAL SENSE. THE IS TOTALED ABOUT 2 BILLION U.S. DOLLARS. WE THINK THERE IS A GOOD CHANCE THAT THESE ARE CORRUPT PAYMENTS. IT IS IMPOSSIBLE TO SAY WHICH ONES ARE CORRUPT, BUT WE THINK TELIA NEEDS TO PROVIDE A LOT MORE INFORMATION TO INVESTORS IN ORDER FOR THEM TO MAKE DECISIONS. FRANCINE: CARSON, SO THAT ALL OF OUR VIEWERS ARE HEARING -- IT FELL 3.3%. IF THE PRICE DECREASES, YOU MAKE MONEY OFF THIS. CARSON: YES. SURE. TOM: YOU MAKE A LOT OF MONEY ON TRANSACTIONS -- DO YOU TAKE POSITIONS SHORTING BEFORE YOU ANNOUNCE THE SECURITIES RESEARCH? ARE YOU IN THE SHORTS AS YOU COME ON THAT SET THIS MORNING? CARSON: YES. WE ARE ALWAYS VERY CLEAR THAT WE RESEARCH COMPANIES, TAKE POSITIONS, AND COMMUNICATE OUR VIEWS. TOM: BUT YOU TOOK THE POSITION BEFORE YOU DISSEMINATE THE RESEARCH. DO YOU THINK THAT IS FAIR TRADING? IS JUST A MOST DOING THAT? -- IS JIM STABLES DOING THAT? CARSON: WE ARE ACTIVIST INVESTORS. TOM: FAIR. CARSON: SHORT-SELLERS GIVEN A MUCH HARDER TIME FOR WHAT THEY ARE TRADING -- TOM: YOU ARE GOING TO HELL, THAT IS WHAT THE WORLD BANK'S. -- THE WOLRD THINGS. CARSON: PEOPLE BLAME SHORTS. TOM: YOU ARE SPEAKING TO TWO OTHER MAJOR AUDITORS. CARSON: IT HAS BEEN DELOITTE -- TOM: ARE YOU SAYING ON THE BALANCE SHEETS THERE ARE ISSUES OF GOOD AND BAD WELL? CARSON: WE THINK THAT WRITE-DOWNS COULD APPROACH. IF THE COMPANY WERE GOING TO BE CRITICAL AS AN ACCOUNTING IN THE PAST IT COULD APPROACH TO $.5 BILLION USD. FRANCINE: THERE IS ALSO AN INVESTIGATION GOING ON. TOM: IS THIS FAIR PLAY? I THINK IT IS GREAT, THE RESEARCH YOU HAVE DONE, YOU HAVE WORLDWIDE ACCLAIM, BUT IS THE PROCESS OF WHAT HE IS DOING APPROPRIATE TO COME OUT WITH THE DISSEMINATED RESEARCH SOMEWHAT AFTER TAKING THE SHORT POSITION? >> HE IS PUTTING HIS MONEY WHERE HIS MOUTH IS, AND I THINK THAT IS TOTALLY FAIR. WHAT HE IS SAYING TO THE PUBLIC AT LARGE IS THERE IS A PROBLEM, WE THINK THERE IS A PROBLEM, WE ARE BATTLING OUR VIEW BY TRADING IN THE MARKETPLACE IT BEING VERY TRANSPARENT. I SEE NOTHING WRONG WITH THAT. TOM: DO YOU HAVE TO STAY OUTSIDE THE UNITED STATES BECAUSE YOU ARE WORRIED ABOUT REGULATION? CARSON: NOT AT ALL. JUST TO EXPLAIN THE BAR THAT WE HAVE TO CLEAR WITH EVERY SINGLE SENTENCE THAT I WRITE IN A REPORT, I ASSUME EVERY TIME A RELEASE A REPORT THAT I COULD BE LOOKING AT CIVIL LITIGATION FROM THE TARGET COMPANY AND THAT I WILL BE DEALING WITH THE HOSTILE REGULATOR. I HAVE DEALT WITH REGULATORS NUMEROUS TIMES, USUALLY MY APPROACHING THEM. I WOULD NEVER CHARACTERIZE ANYONE OF THOSE INTERACTIONS AS HOSTILE. I HAVEN'T BEEN TOO BAD. IT IS A VERY HIGH BAR. I HAVE NEVER MET ANYBODY DOING EQUITY RESEARCH FOR CHARITABLE PURPOSES. MY MODEL HAS A LOT OF TURBULENCE. THERE ARE THE LEGAL ISSUES THAT COME UP WHEN COMPANIES SUE -- TOM: GOLDMAN SACHS IS NOT TAKING POSITIONS, THEY ARE DOING SECURITY RESEARCH -- CARSON: LOOK, GOLDEN FOR THE PRIVILEGE OF SITTING IN BETWEEN, THE PUBLIC AND THE MARKET, THEY HAVE TO SEGREGATE RESEARCH FROM SALES AND TRADING. TOM: BUT YOU ARE NOT SEGREGATED. CARSON: NO. FRANCINE: THAT'S CLEAR. JAMES: WE SHOULD ALSO TALK ABOUT WHAT IS NOT MORAL, THE CORRUPTION -- THE PUBLIC ARE SAYING -- OR CONVERSELY, HE SAYS YOU SHOULD BUY THESE SHARES -- THAT WOULD BE --

Muddy Waters Says It Is Short Teliasonera

More From Bloomberg Surveillance
All episodes and clips