Web traffic continued its dramatic spiral for Matt Drudge’s news aggregate site in October and at this point, the negative numbers are beginning to resemble one of the models employed to predict corporate disasters.
One of the things you learn as a Ceritifed Fraud Examiner is forensic accounting and modeling and Drudge’s recent and quick mud slide of web traffic is starting to look like the Enron model. And that obviously is not good.
It is a good thing Drudge is not working in corporate America or running a publicly-traded entity. He would be in deep trouble.
As Investopedia frames it:
The story of Enron Corporation depicts a company that reached dramatic heights only to face a dizzying fall. The fated company’s collapse affected thousands of employees and shook Wall Street to its core. At Enron’s peak, its shares were worth $90.75; when the firm declared bankruptcy on December 2, 2001, they were trading at $0.26. To this day, many wonder how such a powerful business, at the time one of the largest companies in the United States, disintegrated almost overnight. Also difficult to fathom is how its leadership managed to fool regulators for so long with fake holdings and off-the-books accounting.
I have used the Enron model — specifically the schematics of its plummeting stock index — as a barometer for pinpointing problematic corporate warning signs, trap doors, and wayward executives and it rarely fails.
Drudge’s overall web traffic is down nearly 18 percent in September and October, according to the tracking metrics on Similar Web. That’s a massive and accelrated slide from approximately 93 million visits to 77 million.
.@DRUDGE is tanking. Traffic down almost 20 percent in 2+ months. Bleeding out.
— Mike ‘Thomas Paine’ Moore (@Thomas1774Paine) November 13, 2019
That type of rapid slide, even though it is web traffic compared to stock price, is beginning to parallel Enron’s stock model.
The point of no return for Enron was between January and March 2001 — a mere 90-day span — when the stock price spiraled 33 percent from approximately $80 per share to $53.
Drudge’s web numbers since August/Sept. are on a similar trajectory. In July, Drudge was pulling almost 100 million web views (95 million). Now he’s at 77 million.
Where this is all going for Drudge is hard to predict. But if history is a lesson and the Enron model is a barometer — there’s trouble in Drudge land.
He might have to start spending some of his millions to maintain web traffic to try to stop the exodus of Conservative readers. Until now, his traffic has been organic.
Either way, the ghosts of Enron are stirring. — Thomas Paine