Betting on former J.C. Penney director Bill Ackman

Although the beleaguered Bill Ackman received negative publicity after he took a spat between him and J.C. Penney's directors public, Brown says his bets are on Ackman. Leaving J.C. Penney was the smartest thing Ackman has done in a while, Brown says.

The piling on re: Bill Ackman - I would bet - has now reached its pinnacle. If he was a stock, and I a deep value investor, I'd be buying him in size here. Okay, maybe I'd be buying calls instead of common, but still - the beleaguered Ackman is probably a bargain here.

It's not that I agree with the way he's gone about meddling with JC Penney to the point of disaster or the presentation of his short presentation in Herbalife (in which his publicly-stated aim was to destroy a company and redistribute the profits to charity). It's just that I believe Ackman to be a very smart investor and, more than that, a determined businessman.

Removing himself from the board of JCP was the first sign that he is fully aware of his situation and the public perception. It may have set up his exit from the losing position or merely a diagonal way toward helping the stock price heal itself - the irony being that the most positive step he's taken as an activist in JC Penney's shares so far has been the removal of his own looming shadow.

If Ackman is now ready to play offense with his $12 billion Pershing Square fund, now that all of his enemies are out of the shadows and their positions illuminated, we should probably start to expect the unexpected.

In the meantime, two new reads this weekend to catch yourselves up:

Jenn Ablan and Matthew Goldstein on how it all started, just before Christmas:

How Ackman's Herbalife bet inflamed Wall Street passions (Reuters)

Also, The Economist weighed in, noting that "things change quickly" in the hedge fund world and Ackman has had the last laugh before, during the MBIA saga for example:

Hash of the Titan (The Economist)