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Marc Gerstein

 
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  • Staples: Why Lousy Companies With Great Managements Are Still Lousy [View article]
    "In my view, this is because customers are realizing that Staples retail stores offer very little advantage over Wal-Mart (WMT) and other big-box stores. Virtually everything that can be bought at Staples can be bought at a similar price somewhere else."

    I have problems with SPLS stock but this is not one of them. I and many other would rather have a root canal without anesthesia than walk into a Wal Mart store, but even for those who can stomach that horror, let's not underestimate in-stock availability. SPLS has stuff and price competition aside, when you need stuff, the store that has it on the shelves is preferable to the one that doesn't.

    Obviously, though, they are going to have to adjust to the modern office environment and that will probably mean a smaller company than suggested by the current market cap. But while they wrestle with that, let's not over-rate management which, may, actually, be their weakest link. When I went to a store to buy a graphic calculator for my kid, they were so desperate to get me to buy a useless and overpriced $7 warranty they actually took $10 off the price of the calculator if I'd do it (which I, of course, did). I asked them why they'd do such a crazy thing and they said it was because the "higher ups" wanted to show a lot of warranty sales. So market conditions aside, anybody who invests their money in a company managed by people like that deserves what they are likely to get.
    Apr 3 02:22 PM | 1 Like Like |Link to Comment
  • Amazon's Streaming Box Has Potential, But It's No Roku, Apple Or Gaming Killer [View article]
    "These people never figured out how to set the clocks on their VCRs after 20 years, I wouldn't count on them figuring out how to voice activate their IPTV streaming devices."

    Wow, what a horrifyingly narrow-minded comment. You may want to read up on macular degeneration, glaucoma and other age-related eye issues. Fortunately for the world, Bezos apparently works on the basis of knowledge, not bigotry, and that's why Amazon is where it is and the haters are where they are.
    Apr 3 12:24 AM | 2 Likes Like |Link to Comment
  • Amazon's Streaming Box Has Potential, But It's No Roku, Apple Or Gaming Killer [View article]
    "You have to realize you are dealing with people with an agenda. Amazon haters that have lost money on the stock."

    Yes, look at Pokernut's comment. What the heck is he talking about? I don't own any AMZN stock. But I am a huge fan of their product.
    Apr 3 12:16 AM | 1 Like Like |Link to Comment
  • Amazon's Streaming Box Has Potential, But It's No Roku, Apple Or Gaming Killer [View article]
    "There is really no benefit to Amazon's copy cat product."

    That is false. There is a MASSIVE benefit to the Amazon product. It's remote control can be voice activated. For many people, this can be a make or break issue. I'm going to order one for my mother, who can watch television but finds it extremely difficult to search for things on the visual interface.

    Actually, amazon is the only company that seems to have figured out that older people tend to have vision problems, often very significant vision problems, and that the percentage of the population in this situation is rising rapidly. Even now, the Kindle Fire product are the only ones that have special interface features for the sight impaired; magnifiers and more importantly, audio menus where you tap something and hear what it is and tap a second time if you want to make that selection.

    Contrary to what many in the seeking alpha community believe, Amazon isn't what it is because of deception or predatory practices. Amazon is what it is because they really and deeply care about their all their customers, not just the 20-something kids.
    Apr 2 05:16 PM | 1 Like Like |Link to Comment
  • What Seeking Alpha Is Doing To Prevent Paid Stock Promotion [View article]
    Tim,

    I don't think a couple of paragraphs and a link to a boilerplate are going to suffice. Have you been reading the comments complaining of moderation, comments placed in articles by Eli that aren't even about moderation? And what's all this about appealing? The nasty-tone e-mails I've seen that have been sent regarding comment deletion expressly stated that the decisions are not appeal-able.

    Your profile shows you came aboard in 2013. I have to admit my understanding may be dated since I sharply diminished my community participation before you came aboard, having decided I didn't want to waste time dealing with what I perceived as an arrogant kindergarten. Have you changed SA's approach since you assumed your position? Perhaps the appeal situation has changed since you've come aboard. With all due respect, I think you should introduce yourself more fully -- in a separate article and not in a reply comment -- and interact with the SA community in a more meaningful way.
    Mar 31 05:40 PM | 1 Like Like |Link to Comment
  • What Seeking Alpha Is Doing To Prevent Paid Stock Promotion [View article]
    Eli,

    I can't help but notice that many comments in response to your editorial-policy seem to be airing grievances that really address moderation. Might you persuade the head of the moderation team to post an article on SA describing their policies, and most important, participate in genuine give-and-take with readers as you've done? It's admirable the way you step up and openly discuss editorial policy, but the moderation team takes an extreme-opposite approach, preferring, it seems, to stay aloof hiding behind heavy-handed boilerplate e-mails, which obviously are diminishing the SA experience for many readers and contributors. Moderation needs to come out of hiding and follow your example.

    Marc
    Mar 31 09:26 AM | 5 Likes Like |Link to Comment
  • What Seeking Alpha Is Doing To Prevent Paid Stock Promotion [View article]
    This is one of the most bizarre article-comment threads (an incredible example of groupthink) I’ve seen considering how quickly it comes on the heels of the recent discussion, also inspired by Eli, about pseudonymity. The sentiment there, not just on the part of Eli but, it seems, the overwhelming majority of those who commented was/is that pseudonumity is a good thing in order to foster the widest range of opinions including those who for whatever reasons are unwilling to publicly stand up and identify themselves as the authors of those opinions. I dissented strongly and maintained that in the area in which SA deals, investment ideas which necessarily address the future and, hence, necessarily deal with opinions, the author himself/herself is extremely important and that one cannot and should not separate the article from the author. As many may recall, my view was, on the whole, very poorly received in that other discussion.

    Well, folks, guess what: You can’t have it both ways. Either the author is important as an element that is separate and apart from the contents of the article or not. If you want to maintain it’s the article that counts, then why are you complaining about promoters, touts, etc. paid or otherwise? What happened to all the so-called emphasis on allowing the article to speak for itself? Goodness gracious, you couldn’t even stick to your guns for a week. If you’re all so comfortable with your ability to digest the article as a self-contained entity and use it as a starting point for your own due diligence, then why all the angst about paid promoters or even short-selling company bashers? (I shudder to imagine what SA and the SA community will look like if/when things really get hot; i.e. the market enters into a sustained downturn – SA was a lot smaller in 2008 and non-existent back around 2000-02.)

    Personally, I believe paid-promoters should not be published on SA. But that is inextricably intertwined with my belief that who the author is, what his/her experience is, what his/her motives are, what his/her level of competence is, what motive he/she may have for advocating a particular point of view, etc. are all critical. If you want to disagree with me – as many do – that’s your prerogative. But it you do want to separate the author from the contents of the article itself, then stop complaining about who is published and their motives for submitting. By your own choice, you have elected to make that none of your business.

    If you want crowdsourcing, fine, then have crowdsourcing. But you have to remember that there are a lot of bad apples in the crowd. And if SA chooses to continue to proudly advocate its support for authors who prefer to work in the shadows (i.e., pseudonymity), then you will always have a de facto welcome mat out for creeps, who, as others have pointed out, are perfectly capable of dodging IP tracking, etc. If you care about integrity, step one is to turn on the flood lights. Step two is to develop a culture wherein we DO care about WHO the author is. Those alone may not be the ultimate answer. But if you haven’t taken these important first steps, then when it comes to integrity, you’re just tilting at windmills.
    Mar 29 04:09 PM | 3 Likes Like |Link to Comment
  • Why Seeking Alpha Embraces Pseudonymity [View article]
    "You wrote a lot trying to legitimatize the logical fallacy known as "appeal to authority". With all due respect, you failed. Even worse, I think you're opening yourself to a lot of obfuscating noise by putting a premium on somebody's "authority"."

    That's a rather amusing comment. One of the (few nowadays) weak spots of the Seeking Alpha offering, in my opinion, is the incredible editorial tolerance for tossing Warren Buffett's name around by contributors who really have nothing interesting to say about him (and may or may not actually understand him on more than a very superficial level) or his ideas but seem to seek to confer legitimacy on otherwise pedestrian content by invoking Buffett's name.

    I'm fully aware of the so-called "appeal to authority" fallacy and what you'd have to say about it if you are taking an exam in a philosophy class. And actually, you have it wrong. The appeal to authority fallacy means the truth or falsity of a claim is not related to the authority of the claimant. But that's not what's happening here. We're not dealing with truth or falsity. This is about the future: NOBODY KNOWS - IT'S ALL OPINION. This is also about money, not philosophical discussion. Hence here, there will, ultimately, be a right and a wrong and a lot real pain for those who are wrong. Bear in mind, too, that you are taking guidance, OPINION, from a contributor you don't know and don't kid yourself about what you think you can discern from the merits of the article alone. Remember, every trade has a buy and a sell, two diametrically opposed views. (Another thing well known to philosophers.) If you don't understand where the speaker is coming from, what perspective he or she brings to bear, you're really restricting your ability to evaluate the opinions to which you're exposed.

    Suppose, for example, Contributor A writes an article suggesting stock XYZ, which plummeted badly after management cut guidance, should be sold. There are many instances in which such advice ultimately proves wise. There are many instances in which such advice ultimately proves reckless. Wouldn't you want to know the author has experience evaluating businesses such as XYZ and is likely to be able to recognize the difference between a short-term glitch and a structural problem that is likely to be longer lasting, or an eloquent amateur who is shooting from the hip rehashing ideas he picked up from message boards, CNBC, etc.?

    As to your experience with GTAT, so you got lucky on a message board. If you think you somehow "learned" something from this and now see the light, all I can say is good luck to you and those who depend on you financially. You'll need it!
    Mar 22 01:12 AM | Likes Like |Link to Comment
  • Why Seeking Alpha Embraces Pseudonymity [View article]
    "You are imprisoned by the current MPT paradigm, maintained by PhDs, and you can't see outside it."

    Where did you come up with that drivel? This is a perfect example of the naive and self-destructive fear of professionalism. What makes you think I believe in MPT and can't see outside it? Rather than ask me what I think, you prefer to invent your own narrative to support your bigotry. And I wonder if you'd dare do something so pathetic if you were posting under your real name. For the record, I hate MPT. Back in the late '70s, my MBA thesis was dedicated to dissing it, and I'm not alone. MPT is now more widely described as an "error maximization" protocol. (I believe that term was coined by Fischer Black in the paper introducing the Black-Litteman model, an effort to try to moderate the worst of the MPT problems.)

    Look, if you prefer children or amateurs to knowledgeable professionals, don't let me stop you. It's your money. Just don't point fingers if, at some point, you find your money gone, as did so many who looked at the content and not the authors a little more than a decade ago.

    As they say, history repeats.
    Mar 22 12:42 AM | Likes Like |Link to Comment
  • Why Seeking Alpha Embraces Pseudonymity [View article]
    Could not DISAGREE more.

    Art is art. If it's good (however you define good), fine. If it's not good, also fine; just move on.

    Actionable investment idea are different. If it's good (defined as it makes money), great. If it's not good, bad, or possibly very bad or possibly disastrous.

    Also, art exists in the present. It is what it is and we can know (according to our own criteria) our own way of thinking about it. Investment ideas address the future. Nobody can know the future. All we ever have are opinions. That being the case, we can NEVER separate the opinion from the one expressing the opinion.

    Seeking Alpha has to be agreeing to this; we know so with 100% certainty because of the disclosures they require and their requirement that at least they know the contributor's real identity. If we could separate the article from the author, there would be no reason to require either. And after all the scandals and controversies of the late 1990s and early 2000s, I should have thought the investing public would have learned the critical importance of understanding the speaker, not just the words. If we no longer care about the speaker, why not go back to the good/bad old days and allow again for analyst/investment banking conflicts.

    And to locutus49, it should make all the difference in the world if a child wrote it because no matter how eloquent the content, I'd have trouble, a lot of trouble, taking seriously any investing opinion expressed by a child, who lacks the experience and maturity to recognize all the potential things that could happen to a position. It's not just a matter of integrity; competence counts, too.

    And don't get to carried away by the crowd sourcing study.

    Since 2009, we've been in an environment where for the most part, chimps throwing darts at a board could have done well. How did crowd sourcing work back around 2000? And BTW, there was a ton of crowd sourcing back then even though the term wasn't widely in use. It was more on bulletin boards than in articles (it was, after all, pre-Seeking Alpha). Remember the AOL boards, the Yahoo! Finance boards before everybody realized they were garbage, the old Motley Fool community (back before the Gardner's discovered value and were whipping up frenzy by citing significant overvaluation as an important buying signal, Sage Online, RagingBull.com, clearstation.com, etc., etc., etc.

    I also suspect the quality of what we've been seeing on SA lately has been and is being impacted by a development that may or may not be sustainable. (I hpe it is but who knows.) This is just and ad hoc hunch, i can't prove it, but . . .

    I suspect much of the recent content is not true crowd sourcing at all, at least not in the sense of hearing from Joe Average. I always read contributor profiles to ascertain the backgrounds and experience of the writer and noticed lately, that a higher portion than in the past are, indeed, bona fide investment professionals. Since the 2008 crash, following on the heels of the post-2000 Wall Street bloodlettings, there have been and still are a lot of very high caliber pros out there who may not be as comfortable in their employment situations as they might other wise like. I suspect this is leading to a lot of the good and sometimes great content we've been seeing lately on SA as these pros pick up a few extra dollars contributing to SA and/or build and support personal brands (the latter a traditional lure for many, including me) and/or showcase themselves to prospective future employers. So let's not rush to glorify investment advice from the average guy. Check the profiles. You may find it interesting to see how much of the content you love is actually being supplied by the professionals you claim (albeit often naively and unjustifiably) to despise.

    A good market combined with a hefty dose of professional authorship; no wonder SA ideas have been performing well lately. The key to the future, though, is not not fool ourselves as to why it's happening but to analyze it and understand it. that's the way to enhance the chances of it being sustainable into the future. . . . that is unless we want to go back to seeing the site cluttered by fanboys pumping Apple at $700 having no clue about the margin growth issues that were bubbling as they drowned out others who tried to point them out.
    Mar 21 08:03 AM | 1 Like Like |Link to Comment
  • Why Seeking Alpha Embraces Pseudonymity [View article]
    "I use my real identity here (obviously) but not on some other forums I use"

    Dare we ask which ones? :-)
    Mar 19 11:15 PM | 2 Likes Like |Link to Comment
  • Why Seeking Alpha Embraces Pseudonymity [View article]
    Eli,

    I read with great interest your article on pseudonymity but have to respectfully but strongly disagree. I’ll respond to each of the three key reasons you gave.

    First, you say you want to protect authors who do ground-breaking research on potentially fraudulent companies and cite China as an example. Yet several of the key China exposers chose to use names that were real or could be readily discovered by going to their firm’s web sites. And even those that really did seek to avoid disclosing their names, you cannot protect them if the company chooses to pursue them legally. Under Paragraph 11 of the Seeking Alpha Terms of Use, Seeking Alpha reserves the right to “access, read, preserve, and disclose any User Submissions (whether published or not) or any other information we believe is reasonably necessary to (a) comply with any applicable law, regulation, legal process, subpoena or governmental or regulatory request, (b) enforce these TOU, including investigation of potential violations of it, (c) detect, prevent, or otherwise address fraud, security or technical issues, (d) respond to user support requests, or (e) protect the rights, property or safety of Seeking Alpha, its users, yourself or the public.”

    As to your second point, about fear of critiquing management fearing to be cut out of future opportunities to engage executives, that’s somewhat stale. We live in the era of Reg. FD. There’s no way management could possibly exclude anybody from getting 10-Ks, 10-Qs, news releases, conference call transcripts, etc. And I can’t imagine you’d consider publishing a contributor is working with non-public information.

    Your third point, the one about thin skin (in contrast to journalists, who you say have thick skin), is the most challenging. But here’s how I see it. This isn’t espn.com; we’re not talking sports. Nor are we talking movies, or posting book reviews like on amazon.com. This is about money; real money invested by real people who could feel real and serious financial pain if things go wrong. So publication of commentary about actionable investing ideas is a very, very serious responsibility. It takes an incredibly thick skin to assume such a responsibility; and even more so when publication exposes a contributor to open and often vehement criticism in the comment area. I think this takes far thicker skin than anything needed in journalism, where everything is supposed to be sourced to someone or something else. Seeking Alpha contributors serve as their own sources. So if they screw up, they have nobody but themselves to blame. Personally, if I see a contributor who refuses to publicly own up to the ideas he or she publicly disseminated, I feel they don’t appreciate or respect the seriousness of the endeavor they chose to undertake. And as to people who are genuinely shy in general, well what the heck, not everybody is cut out to do everything. I don’t ride motorcycles because I’m chicken. I don’t wear tight bathing suits on the beach because – well, let’s not get into that. I don’t make millions playing major league baseball because I have zero talent. But I do contribute to Seeking Alpha because that’s something I can do. And as a reader, I’m only interested in contributors who understand and can take the heat associated with the importance and potential consequences of writing about stocks.

    I noticed you didn’t refer to one consideration SA had cited in the past, the need to protect authors whose jobs may prohibit them from openly publishing commentary. (I wonder if that was a deliberate omission.) My feeling about that was that if one’s job prohibits contributing, then one should not contribute. And if someone is willing to pull the wool over the eyes of the company that pays his salary, there’s no way I could trust he wouldn’t be pulling the wool over the eyes of me, the reader. And I always disliked SA’s willingness to cooperate with that sort of thing.
    Mar 19 06:19 PM | 4 Likes Like |Link to Comment
  • How You Can Invest Like Warren Buffett [View article]
    Interesting that while citing Buffett as an inspiration, your "constitution" lists margin as a prohibited strategy. Yet margin (about 1.6-to1 on average) is a major aspect of Buffett's returns; and not just margin but margin at minimal cost thanks to BRK's triple A rating and its insurance float. Being able to take on that much margin at negligible cost with zero risk of margin calls during even the worst bear markets (and even the ability to buy more) is huge; even if you do everything you think Buffett is doing, you can't expect to come to earning the returns he earns.

    The Buffett philosophies discussed above in the article is the same accurate (as far as it goes) but very limited PR that's been out there in one form or another for at least 20 years.

    For a more insightful view of what Buffett actually does, check this: http://www.econ.yale.edu~af227/pdf/Buffett... looks like seeking alpha didn't record the link properly; you can google: warren buffett's alpha pdf frazzini
    Mar 16 11:20 AM | 1 Like Like |Link to Comment
  • Plug Power: Is This Time Different? [View article]
    I hadn't even heard of PLUG until just recently, when I noticed some prominently placed articles with shrill headlines so I have no opinion at all about the stock. But I did notice two questionable analytic points in this article:

    1.

    "If you have the option to buy two cars that cost the same amount and perform basically the same except for one car comes with free maintenance, which one would you choose?

    It wouldn't matter to you at all that the company offering free maintenance was actually operating at a loss."

    Actually, it would matter to me A LOT. There's no way I would factor a free maintenance program into my decision unless I considered the viability of the company making that offer. If I thought the company's survival might be in jeopardy, there's no way I'd act on the basis of the offer.

    Wal Mart wasn't born yesterday. I'm sure they know this. While they may be avaricious viz. their suppliers. I can't imagine they'd hinge purchases on ongoing services the company may not be around long enough to provide.

    2.

    "Why would PLUG sell almost 4 million shares when it was already sitting on over a year worth of cash?

    The answer is that management knows the stock has no business trading at $5.74 per share. There is no other explanation for this unnecessary capital raise. The fact that the stock has almost doubled over the past week following this unnecessary equity offering makes this whole episode even more preposterous."

    The CFO should have been fired had the company not raised equity. A company at this early heavy-cash-burning stage would have to be out of its mind to refrain from taking an opportunity like this to build the cash cushion as high as it can every chance it can get.

    What about dilution? That's not the company's problem. That's the shareholder's problem. Those who choose to invest in development stage companies that really haven't yet established commercial business models necessarily bear this risk.

    PLUG isn't the first instance in which a company probably went public earlier than it should have. But for better or worse, they did so (as have others) and those who own shares presumably understand the risks and rewards (although there are always many who don't do their homework, not just with PLUG but even such venerable standbys as WMT).

    Bearish may well prove to be the right stance here, or not. My problem, as someone new to this situation and reading in an effort to get a sense of what's going on, is that this article contributed nothing to my effort to get up to speed. Instead of discussing the make or break issues (e.g., the merits of the product, the likelihood it will find additional customers -- enough to help cover fixed costs and get it up toward profitability), whether the free maintenance services are likely to eventually help push it up to that level, etc., all I see here are gratuitous and fallacious attacks on management.

    " Author’s reply » Perhaps you should have read the article, the stock is down -40% since your smug comment. "

    Come on Hugh. From your profile picture, it looks as if you've been in this business for at least as long as I have if not longer. Commenters come in all stripes, some brighter than others. But I would hope a pro should know better than to get pulled into a pi**ing contest like that. No matter how right you are as of today, there's always another day and always another stock.
    Mar 12 07:56 AM | Likes Like |Link to Comment
  • Herbalife Throwing Money At Its Problems [View article]
    "The facts are the facts -- Ackman is short, no question about it. And, he's preaching his case the same exact way that longs preach their case on a million different stocks every single day."

    Really? Please name, one by one, longs who preach their cases on a million different stocks every day through the sort of PR blitzes mounted by Ackman. This request isn't nearly as burdensome as it might seems. I suspect the headcount is somewhere around zero.

    So what exactly is your argument? Are you suggesting that a company that tries to defend itself against an unprecedented PR campaign openly designed to destroy the company and drive its stock price to zero is evil? Longs aren't giving you grief because you're short. They're giving you grief because they reject your logic.

    And as to disclosure about where sales go, who cares! What planet are people living on? I assume that 100% of the products sold by HLF are used by those who are called distributors and the whole MLM thing is a cute and in my opinion silly game. (Personally, I have more respect for product distributed through more conventional channels -- but that's me.). That's why I'm not a fan of the business and don't own any of these stocks. But the fact that I don't like a business doesn't make it a scam.
    Feb 28 11:42 AM | 14 Likes Like |Link to Comment
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