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Portfolio > Economy & Markets

Why Corporate America Loves Zombie Friday

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If you’re hung over, a bit groggy and have a sudden taste for the flesh of the living, you’re not alone. It’s just another “Zombie Friday.”

The term denotes the workday after a Thursday holiday, when companies like to dump depressing news on the populace, hoping you’re still sleeping it off from prior festivities and won’t notice.

Marek Fuchs runs through a number of examples of this plodding and brain-dead behavior on The Exchange.  

“There has been a long, sordid history of bad news released on Zombie days — from presidents pardoning controversial criminals to companies admitting to stock backdating or firing thousands of employees,” Fuchs notes.

The United States Mint goes down in market lore as one of the most egregious examples.

“Only the heartless would have fired workers at the time surrounding Sept. 11, but that’s just what happened when the Mint determined the slowing economy was lowering demand for coins,” he relates. “They didn’t want to be seen as cold, however, so they took advantage of a Zombie Day.”

The Mint timed the firings so that, on the day after Thanksgiving when “everyone was zonked out on tryptophan,” The New York Times ran with the headline: Facing Decreased Demand for Coins, Mint Starts Layoffs.”

Firing hundreds when headed into the first Christmas after a national tragedy sounds outrageous, and would have been had more people known.

In 2006, Corinthian Colleges, a provider of health care training, admitted on the Friday after Thanksgiving that it did, in fact, backdate its options after all. It was news they had to release but few saw, thanks to Zombie Day.

Ironically, a portion of those options were originally backdated in the days after the September 11 terrorist attacks.

“Talk about a company with a tendency toward operating under cover of night,” Fuchs concludes.

Check out When RIA Zombies Attack, Money Manager Has Survival Guide on AdvisorOne.


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