The Internet v. Quality of Information: Chapter 1 - SeekingAlpha.com

Michelle Leder at Footnoted.org has raised a very interesting discussion about a leading investment website, SeekingAlpha.com. She highlights a controversy surrounding the stock of the company Microvision, a microcap company that makes compact display solutions, that occurred when a hedge fund published a negative piece on SeekingAlpha. According to Michelle, Microvision's stock price fell from $3.40 to $3.00 -- so the story may have had a substantial impact on the price of the stock. If the hedge fund was short the shares, as the author indeed said they were, then they could potentially have made quite a bit of money from the position -- 13% depending upon the entry/exit prices.
But this brings up a larger issue than just the hedge fund using a public online forum to manipulate the markets, it brings into question whether or not blogs and other online investment information sources need to be regulated. As the flow information shifts from traditional equity research sources (which are highly regulated) and newspapers/magazines (which are not) to blogs and online sources such as MarketWatch.com, BigCharts.com and other forums, is there a role for ensuring that the average individual investor is protected from wrongdoings and manipulation by more sophisticated players?
Regardless of how this issue gets resolved, it once again highlights that people need to use critical thinking in evaluating the source of the information they are receiving and whether that source has any incentives for skewing the information. Usually they do. And usually they will.