Valley Outsider

Hedge Funds Not Alone in Defending Short-Selling Secrecy

The main reason as I see it for the huge downturn in the market over the fall of 2008 was hedge funds putting large amounts of sell calls into the marketplace, and shorts on ETFs bringing down individual stocks like the last car on a rollercoaster. For an individual investor, this amounts to trying to ride your bike along a highway and stay on the road while 18-wheelers fly past you. You don't stand a chance. The supply shocks from these two forces were big enough and there were enough of them to push the price down in a major way and there was nothing you could do about it.

Now the question is, what market forces exist in large enough quantities to push the prices back to where they were?

Another question is, why am I riding my bike on the freeway? Why invest where you have so little clout or control of the environment? I don't personally have anything against hedge funds as an instrument, but I will continue to look for genuine bike paths to ride on from this point on.

Detroit: Please Bring Back the Stripped Car

This is the most baby-boomer minded article I've read in a while. "Where is my manual transmission, AM radio, hand-crank window model?" Is there anything that sounds more dated? Garland, do you actually drive such a car? I didn't think so.

After going for years without power mirrors and driving at night with the right mirror shining in my eyes and having no way to move it while driving, I swore I would never buy a car again without power everything. No one wants to drive a stripped down model, and this has been 'priced into the market' as they say. Detroit just follows the trends that the consumer research tells them, and they cannot be faulted for that.

A stripped down model is the way of the past--it has no role in the future, sorry.

You could compare it to the Netbooks vs Laptops marketplace.

Netbooks are widely successful in the PC arena not because they are stripped down, but because they went back to the true reason people liked laptops in the first place--they are portable! Ask anyone who's lugged an 8lb laptop thru an airport if they wish it wasn't a third the weight. Of course they do! Yes they are stripped down in terms of features and cost less, just like a Plymouth Fury, but no one has to carry a Fury. The few number of features is not the primary reason they are successful--the weight and size is. Even the words "Desktop Replacement" make my shoulder hurt.

Marc Andreessen on Financial Crises, No IPOs, and Obama

The reason there are fewer tech IPOs is because they are not as lucrative as they used to be. Well why is that you say? Because the price run-ups are not what they used to be. And why is that? Two reasons:
1. There are very few tech businesses that can show hockey-stick growth patterns.
2. Small investors are tired of publicly-traded silicon valley companies constantly diluting the float with employee stock options. This depresses the stock price. Why else would a company like Cisco, which has phenomenal growth rates, have an essentially flat price?

If tech companies want to get real with investors, they should go ahead and pay their employees cash, so it would appear on the balance sheet. Investors would have an easier time understanding exactly where the costs are, rather than take it out of the pockets of investors by granting stock options. I mention this to executives, and they say, well then, tech companies would never be able to show a profit. And there people, is all the information you need.