Most of us invest.  We read the business news, we read the national and international political news, we rely on research and analysts and our personal observation of trends, products and the like.  It seems we are missing important data, however.

We should be reading the gossip columns.

Astute readers of the Wall Street Journal may have seen an article which convincingly ties the divorce status of CEOs to stock price.  (Thanks to Frank, one of my co-members of the National Association of Corporate Directors, for pointing this out to me, as I seemingly was not astute enough to notice it myself.)

Divorce that create the risk that a CEO must split his/her stock with the divorcing spouse can be a negative, as it suggests an overhang of shares for sale in the market.  Is there a pre-nup?  What is the law of the State applicable to the divorce, does it create community property?

A more subtle risk inheres in the perceived attitude of the divorced CEO whose personal wealth typically has been clipped.  The fear is that that CEO becomes more risk-adverse.  Some evidence is noted to the effect that cash bonuses and stock grants increase following a divorce, reflecting board perception that incentives for risk-taking must be increased following “a loss of wealth.”

Should we expect a new disclosure section mandated by the SEC?