Columnist at Fortune, the Wall Street Journal, MarketWatch, TheStreet.com

Commentator on CNBC’s Mad Money, panelist on Fox News Channel’s TheStreet.com

Co-founder of GreenbergMeritz Research & Analytics

I’ll never write a book,” Herb Greenberg tells me. In fact, he has told me that maybe 50 times. “Everybody writes a book. They put their heart and soul into it and then it sells five thousand copies. It’s not worth the trouble.”

As a first-time author, I’m sure hoping he’s wrong. But even more than that, I hope he changes his mind and writes a book, because a lot of people could make—or save—some serious money because of what he knows.

If you have watched any business television over the past 15 years, or read any business publications for about 30 years, chances are that you’ve seen Herb’s face or read his words somewhere. I met him in the late 1990s when he was a frequent guest on CNBC. (I’m happy to still call him a friend. My wife and I—before our kids—once enjoyed a Christmas-day dinner at his house with his family. How many people can say they had Christmas dinner at the Greenbergs’?)

During a period of time in which virtually everybody was ecstatic over this newfangled thing called the Internet, a never-ending stream of stock analysts would come on to tout the latest dot-com idea where you could get rich by taking an investment plunge with this or that new company. Herb refused to join the party. He never drank from the spiked punch bowl.

In fact, he was often deployed by bookers and producers as the foil to the gleeful fraternity of television stock pickers who liked to needle Herb’s anti-bubble sentiment—even as they stayed away from the details of his arguments. “Ahhh, Herb, that’s crazy!” they would sometimes laugh. And I know this because I anchored some of the segments and saw the reaction to him trying to bring honest-to-goodness dissection of balance sheets to the conversation. Remember, this was a time when the so-called new paradigm meant that quaint things like revenue and profit were a relic of the bricks-and-mortar past.

But Herb would never take it personally, laughing right back at them, because he knew from his reporting and looking at public documents issued by struggling companies for the previous 20 years that when he saw something that didn’t add up, it was a red flag that wouldn’t go away just by wishing it so.

He threw up red flags on well-known companies like Tyco, E*Trade, and MBIA, Inc., and lesser-known companies like Leamout and Hauspie, Media Vision and AremiSoft. (Herb: “One of the biggest frauds you’ve never heard of.”)

And what does he look for? It’s more of an art than a science.

“As a journalist, remember—my info always started with tips or ideas from Wall Street, employees of companies, or others,” he says, adding:

There are so many different scenarios that make for the perfect story or situation. Aggressive accounting is always a red flag; obsession with a stock price; bonuses based on easy-to-meet metrics that can be maneuvered; products that are sold into saturated markets. No one size fits all.

Herb recalls, “Media Vision, whose CEO and CFO would end up going to jail, was busted wide open when a former employee came to my office and showed me a second set of books, and that’s after I had been writing about receivables rising faster than sales and other aggressive warning signs.”

He has always tried to stay a step ahead of companies as they paint a happy face on balance sheets or income statements that are full of financial frowns. And being a step ahead of others has been a trait of his TV career as well.

Herb was on Jim Cramer’s Mad Money on CNBC for a year, the San Diego-based component of the “East vs. West” segment, “before anybody watched the show,” he says.

“I was on Fast Money for a year before anybody watched it. I’m the guy who comes into the show when no one watches it. I was on TheStreet.com show on Fox before it became Bulls and Bears—before it became a one-million-viewer show.

“I do everything for a year, I leave, and then they get big,” he says, reflecting his typical modesty.

Herb’s earnest efforts as a business journalist were rewarded rather immodestly at one point with some stock options at the TheStreet.com, where he was hired as a columnist.

But as a journalist, he was reluctant to sell the company’s stock.

“When the stock was at a very high level, if I had sold the stock, I would have had to file public documents and it would have shown publicly how much stock I had,” he says. “And it would have shown how much I was selling and how much I was making. For a journalist that would have been perceived as a considerable amount of money and probably would have raised a few eyebrows and garnered a line somewhere in somebody’s column. You always risk that in journalism if you’re perceived to be paid highly.”

But if he could go back and do it over again, he probably would have pulled the trigger on selling the stock sooner. By waiting, he estimates he sold his stock at a level that was 25 to 30 percent of what he would have received had he sold earlier, which meant he left a lot of money on the table.

“I learned I don’t owe anybody anything in not selling it.”

It may have been a costly mistake, but not his best one. That came at the beginning of his career, before he became a writer for the San Francisco Chronicle, the Chicago Tribune, the Wall Street Journal, TheStreet.com, MarketWatch, and Fortune magazine. What he did back then helped launch a business journalism career that informs his work even now as the co-founder of the independent investment research firm GreenbergMeritz Research & Analytics.

You can be sure he’s finding some red flags, and you won’t read about them in a book.

“I’ll never write a book.”

Yes, Herb, I know, I know. But you should.

Herb Greenberg’s Best Mistake, in His Own Words

In 1975 I took a year off from my first year as a reporter at a small daily newspaper in Florida to work at a trade publication in Nashville. But a year later I wanted to go back to daily newspapers and to go work for a Knight Ridder property.

Having gone to school on a scholarship from the Miami Herald, I vvent to Knight Ridder and asked for help. They lined me up with several interviews, including one to work on the city desk of the Detroit Free Press. You have to understand, in those days it was like saying you had an interview at the New York Times. Maybe not quite the same level, but the DFP had a reputation as one of the best newspapers in the country. It had some of the best editors and staffs in the country, right up there with the Philadelphia Enquirer and the Miami Herald.

I flew up for an interview and, well, I blew it. I was in the wrong place at the wrong time. They were just the wrong situation for me. Had I gone there and interviewed as a business reporter, I may have had a much better chance, but I think I was still green.

I took a series of tests that I later learned I had done extremely poorly on.

When the managing editor asked me what my good traits were, I said, “Dependable.”

“My dog is dependable,” he shot back at me.

The minute I said “dependable” I knew I was dead. When he said, in effect, “So is my dog,” I knew this job opportunity was going nowhere.

So then he had me sit out in the newsroom for a few hours and I was feeling like an absolute fool. You’re not prepared for this, to just sit in the middle of a newsroom at a desk and wait, so that you could maybe see someone else. So I finally met with the executive editor—and by that point my ego was probably beaten up a little bit, and I felt like I was in the wrong place. Again, a terrible interview.

I flew back to Nashville and didn’t hear anything for a week or two. So I called the city editor and I will never forget his words: “Frankly, we think we can find somebody better.”

Talk about a motivator! I vowed then that I would get revenge, and the best revenge is making them wish they had hired me.

Not long after that I interviewed at the St. Paul Pioneer Press, another Knight Ridder paper. This time I applied for a slot on the business desk. Remember—in those days, business news was still the behind-the-sports-pages backwaters of journalism. I also had a big bushy head of hair—not quite the right look for a business reporter in Minnesota.

Well, I went up and interviewed and didn’t hear back. So I pestered the business editor (who has since become a dear friend). And pestered him. And pestered him—until he hired me!

St. Paul was a mini-Chicago for business news. It was the perfect place to start, as business news started to come into its own. I was tossed in and covered retail (Dayton Hudson, now Target); food companies like Pillsbury and General Mills; 3M, which was my beat; and two airlines (Northwest and North Central, then a regional carrier).

You couldn’t pay for that kind of experience. Plus I met my future wife in St. Paul.

And then it happened: I started seeing my stories, which would regularly run on the Knight-Ridder newswire, appear in the Detroit Free Press and in newspapers around the country. It felt like that was the sweetest revenge.

I was then recruited away to Crain’s Chicago Business and was later hired on the business desk of the Chicago Tribune. Later I became the Trib’s New York financial correspondent on my way to a 10-year stint as the lead business columnist at the San Francisco Chronicle, a five-year freelance column at Fortune magazine, a contributor job at CNBC, plus columnist stints at TheStreet.com in its early days and, later, MarketWatch. Oh, and for several years I had a Saturday column in the Wall Street Journal, before leaving to start my own investment research firm.

You might say that the best thing that ever happened to me was screwing up those interviews and not getting hired in Detroit.

The mistake was being ill-prepared for that type of interviewing process, going to a place that was probably a little more sophisticated than I was ready for. My interviewing style, the lack of confidence—that was all a mistake.

Q. So if you had followed your gut, would your gut have said go, or would it have said not to go?

That’s a good question, because if I had to do it all over again I wouldn’t have gone. On the other hand, it’s part of the process. You’re going to make those mistakes, and if you don’t make those mistakes, you’re not going to learn and you’re not going to grow. And you’re not going to take chances. So you have to sometimes go through those stupid interviews, where you say stupid things, to get better.

Q. How were you different in the St. Paul interview?

I learned a lot about confidence from that Detroit interview, and that if you don’t go into an interview with confidence you’re not going to get hired. You can’t go in there and feel like a patsy. You can’t feel like you’re beneath them. You’ve got to go in there and try to wow them.

In those days I was just learning. I never would have perceived myself as an aggressive digger. Today, let’s just say the best compliment I get is when people complain that I ask too many questions.

“Dependable.” Ugh.

About Herb Greenberg

Herb Greenberg is a veteran business journalist, best known for red-flagging companies. Before co-creating GreenbergMeritz, he wrote the “Weekend Investor” column for the Wall Street Journal and was senior columnist for MarketWatch.com, where his market blog attracted a large national following. Herb also has written financial columns for Fortune magazine, TheStreet.com, and the San Francisco Chronicle and was the New York financial correspondent for the Chicago Tribune. He also spent a year in the late 1980s as an analyst for an arbitrage firm. According to one study by Harvard University, Herb is the only individual reporter whose stories preceded Securities and Exchange Commission (SEC) investigations into accounting issues more than once. Until starting GreenbergMeritz, he was also a regular contributor to CNBC-TV, appearing on numerous shows, including Fast Money and Mad Money. A native of Miami, Florida, he holds a BA degree in journalism from the University of Miami.