Long or Short Capital

This is a sponsored post from ReviewMe

What if there was an online market place for small time venture capital fund raising? Would that be something you might interested in? That is what the The Go BIG Network’s Venture Capital Funding provides. I love markets, so much so that I’ve played Monopoly games wherein we have created ad hoc derivative markets to better match the demand for complex financing of fictional real estate projects. But this market seems to be plagued by that which plagues most Internet marketplaces: Low quality listings. It’s unclear whether this because the quality controls of the site itself are weak or that this is just an unstoppable internet phenomena.

Take two listings available today.

Travel Packages worth $15,000 for one-time fee of only $1,295 /couple Around The Woprld Travel Packages
Recreation – Travel Packages and more…

Not only is this just an advertisement for some crappy spamlike vacation package, but they don’t even misspell “World.”

Real Estate Co. Seeks 250,000 for mulit unit projects Baxter Enterprise Investments, Inc
Funding needed for rehabing projects short term

Keep looking for $250k, because who would fund someone that much who can’t even take the time to review their 10 word title for mistakes.

But this doesn’t address whether this marketplace actually works. Does this market connect venture capital with those who need it? It’s difficult to say. But my gut feeling is that in the modern world, the types of businesses who would use this market are precisely the ones who are not capital constrained to begin with. Most online ideas are likely to be critical mass constrained.

The GO BiG Network itself is essentially a social networking site for VC’s, wannabe VC’s, wannabe VC funded entrepeneurs and wannabe VC funded wannabe entrepeneurs. From their about page:

The Problem We Solve

The startup community is highly disconnected. Startups, investors, job seekers and service providers all need one another to survive and grow yet at the same time they are hindered by their own lack of connectivity. Go BIG allows members of the startup community to connect faster by exposing all of the demands of the startup community in one place.

Recommendation: We peg The Go BIG Network’s Venture Capital Funding as market neutral; no harm to play with it just like the online C2C debt lending site Prosper.com. We can’t be short something that has no downside other than time. The catalyst for an upward revision of our sentiment would be the development of a critical mass market place. And if that critical mass market were to gain critical mass, we would expect this site to be bigger than eBay.

Carson Daly was developed by a secret cabal of corporate interests as a response to worsening corporate conditions in America in the 1970’s. He was the first corporate interest enforcement droid created by this cabal and he operates under a programming rule set called “the Prime Directives” as follows:

1. Serve the corporate trust
2. Protect the public from thinking
3. Uphold corporate interests
4. Never oppose a media company officer (any attempt to arrest a media company rep results in automatic Carson Daly shutdown)

The market says that a position in Gerald Ford is crazy.

It says, “Gerald Ford is just a filler president with no historical appreciation upside. His most memorable acts are pardoning Richard Nixon and being mocked as an incompetent klutz on Saturday Night Live by Chevy Chase.”

I say to the market, “Market, you are crazy. Any man who can get me a bonus vacation day is someone I want to be long. Washington, Lincoln, Martin Luther King, Christopher Columbus, the signers of the Declaration of Independence, the Pilgrims, Valentine, Jesus, laborers and all our soldiers, I am long you all. And I am long Gerald Ford too. And I think he deserves some credit for Presidential seppuku in pardoning Nixon, not to preserve his own honor and not to preserve Nixon’s, but to preserve and protect the institution of the Presidency itself. He took one for us all. Gerald Ford, I am long you.”

Recommendation: Get prepared to be long Jimmy Carter soon.

Who would have thought that a chain of stores that sells overpriced esoteric technocrap (all of which include some sort of ionization feature to reduce odors) and whom I associate mentally with lifesize Boba Fett statues would be run by a complete and total nerd? WATFO? Footnoted.org points to this SEC filing made by the Sharper Image (NYSE: SHRP) which lists that former CEO negotiated to buy from the company some of his former office decorations as part of his severance, including C3PO a C3PO sculpture and a Superman statue.

Sculptures: I would like to purchase two sculptures that decorate my former office or that the Company retails. The Company will sell me the 3CPO sculpture that was in my former office for $7,500 (which is 50% of its retail price of $15,000) and a Superman for $2,500 (which is 50% of its retail price of $5,000), for a total of $10,000, which I already have paid to the Company. I will pay the Company the cost of shipping Superman to me, within 30 days after this Agreement becomes effective. I may take the 3CPO model from the Company’s office (or have it picked up at my own expense), and the Company will ship a Superman to me.

Perks come with the territory of being CEO, but would shareholders really approve of perks if they knew that they were the kind that further nerded up their company? Nerds come in all stripes, and while some nerds add value (finance nerds like me and also those red/purple nerds which create beautiful synergy in my mouth), nerds of the 40 year old virgin ilk (cipher nerds) pull it straight off the table.

Here is a chart which scientifically demonstrates the effects of a cipher nerd on the stock price of a publicly traded company. The start of the chart is approximately the point in time just before the realization that the CEO was a cipher nerd. The rest of the chart demonstrates how the market prices such a fact.

Recommendation: Given that the Sharper Image is trading at nearly a 50% discount to it’s nerd-free valuation of $20, it looks like a buy at $9.41. The market has been slow to recognize that the taint of the nerd has been lifted and we expect the battered stock to rise up to its nerd-free valuation as the market corrects itself. Additionally, there is an activist shareholder opportunity in finding companies whose CEOs watch Battlestar Galactica or keep a twenty-sided die on their desks and then taking action to affect regime change, thus realizing significant appreciation of shareholder value.

Jack Welch has such unparalleled management skills, they named Welch’s Grape Juice after him because he squeezes the sweetest juice out of his workers’ mind grapes.

-Jack Donaghy (Alec Baldwin) in “30 Rock” (season 1 episode 7)

Past Quotes Entirely Relevant to Investing

It appears that our future overlords are putting feelers out on the world which they will soon own. Japanese scientists filmed and a caught a live giant squid for the first time last week (see our previous reseach reports Long Cephalopods, Updating the Cephalopod Position: Shark vs Octopus and The Cephalopod Index Is Officially Out of Control). No, the Japanese are not planning on taking over the world like they tried to in the late 80’s. The squids and their cephalopod brethren are the ones who seek to rise from the depths of the ocean. Or perhaps they would rather simply rise the depths of the ocean?

Who is really behind global warming (see releated research report Make Emissions Delicious, Stop Global Warming)? They claim that it’s carbon emissions or other man-made causes which are the problem. But whenever we want to get the heart of an issue, or find a cause for something, we always ask the question “Who has the most to gain?” In this case, man gains little and potentially loses a lot by causing global warming. Less land will be hospitable, tropical zones will spread bringing with them malaria and a bevy of diseases, less rain will fall, hurricanes will be more frequent and more violent, polar bears will drown, and more land will be underwater.

Think about that last point. Who gains from that? Surely not man, who cannot swim well and is afraid of sharks. Surely not the Grizzly Bear, who while adept in the water and capable of fishing, would need at least a small stone perch in order to defeat a Great White Shark in the wild. Surely not the Cheetah, who while swift on foot, is so inbred that there is not enough diversity in his genepool to adequately fend off disease. Surely not the Platypus, who is famously neutral in all inter-species issues. Who does this logically leave? The Cephalopods, the creatures who lurk in the depths of the ocean, who duel with whales and kill sharks. They will be the masters when the world is underwater and thus they are likely behind global warming.

Recommendation: This small giant squid was location scouting for his leaders, searching out the best landside seastates for future wealthy squids. While traditionally seaside land in warm climates has been desirable real estate, when the squids take over, landside sea will be the real estate worth owning. We do not recommend flipping your seaside real estate for landside sea as of yet (our catalyst would be a sea creature Bastille event at a major acquarium), but we do recommend hedging all your real estate with offsetting sea. This offers an important hedge against the growing likelihood of dominant species regime change. We continue to recommend a long position in the Cephalopod Index, as a hedge against the end of overwater civilization as we know it.

[The investors] said to me, ‘Well how can you continue, can you… do you have the strength, or the will, or the enthusiasm, or so…?’ And I said, ‘How can you ask me this question… it is… if I abandon this project I would be a man without dreams and I don’t want to live like that: I live my life or I end my life with this project.’

-Werner Herzog on why he finished Fitzcarraldo after harrowing setbacks

Past Quotes Entirely Relevant to Investing

Discerning children and adults alike are demanding a Nintendo Wii, the new console by Nintendo (OTC: NTDOY), for Christmas. The demand had peaked as of Wednesday when at any given time 6000 Wii’s were available on eBay and the consoles were selling for $200 premiums over their list price of $250 (compared to the Sony (NYSE: SNE) Ps3 which had fallen to $100 premiums and now sells for about the face price of $600). What do you do get when you can’t afford the premium but want to let your kid or boyfriend know that he will be getting a Wii for sure? Enter the Walmart (NYSE: WMT) Nintendo Wii Gift Card.

Whlie Walmart’s card states you can use the card for any $250 combination of Walmart goods, by having the Wii on the card, it psychologically primes the receiver of the card to not use it for anything except the Wii. The next step is to lock them in and remove the ability to use it for other things altogether.Why give someone cash when you can them a raincheck for a specific item that is impossible to find!

Gift certificates are more liquid than product specific gift cards, so are more likely to be utilized and are worth more than product specific gift cards. Yet both are priced the same with respect to their nominal purchasing power, which means that a gift card offers a worse deal for your child or loved one than simply getting a gift certificate (much less just giving them cash). Show you care by limiting their choice and reducing the liquidity of their convertible gift assets!

Recommendation: Essentially, these are free loans of indeterminate durations made by consumers to corporations. If Wii plants are the victims of sabotage, we would use this as the catalyst to enter into any stock which has forward sold their Wii stock with no delivery date. Also look for firms who find are most effective at replacing their gift certificate debt with product specific gift card debt, affecting a lower cost of financing.

By the way, if you really want a Wii, LoS can get one for you. It’s simple. Just send us $250. We will in turn give you a link to print out an official LoS Nintendo Wii gift card. We cannot say when, but we guarantee delivery at some point in the future, let’s call that date X Xth, 2XXX. At that point you can pick up the Wii from our retail locations*. In the mean time, you can use this to give as a gift in the place of the actual Nintendo Wii (which Wii you would now be unable to buy and receive in time for Christmas because you are a horrible parent who has procrastinated your gift buying) to appease your litter.

Which do not exist

There is a consensus that global warming is a problem; not debatable.

There is consensus that the magnitude of the problem has the potential to be ginormous; not debatable (the cause, extent, and likelihood of this potential are all very debatable).

But there is no consensus on the solutions proposed, most of which have more holes than our own ozone (Kyoto), are as of yet unproven (carbon credit trading), or are downright scams (those firms like Terrapass which allow you to “offset the carbon emissions of your car” by PAYING THEM to invest in renewable energy sources or planting trees and crap. Note to the world: you and the rest of the world are likely better off just picking a random publicly listed clean tech pureplay and sticking all your ROTH IRA moneys into it rather than filtering it through these toll collecting middle men. This is the same scam as Fair Trade. And your part in global warming is only slightly played by driving cars, as the bulk of your contribution to the problem comes indirectly from actions you take.).

This is when I use facts.

Fact: There are more people everyday.
Fact: More greenhouse gases enter the atmosphere everyday.
Fact: People need to eat.
Fact: Greenhouse gases may lead to global warming.

Solution: Make greenhouse gases more delicious.

If carbon emissions were delicious, people would eat them, and they, the gases not the people, would either disappear or be processed into harmless byproducts based on science. Despite this obvious solution, there is not a single research scientist whom we’ve uncovered in our digging who is working on a way to make carbon emissions delicious. And it’s even worse than that. The millions of hungry mouths which are added to the world every week don’t demand delicious edible exhaust; they would almost certainly settle for edible exhaust, a much easier bar to clear for any potential edible exhaust innovator.

Recommendation: In the current climate, there is a real opportunity for a company bold enough to place an R&D bet on the nascent “Clean Plate Tech” industry. But more than that for anyone with capital and a conscience, this is also a way to dollar vote for a better future for your children and your children’s children. It is a financial moral imperative to get this done.

In love markets, as in all markets, everything has a price. Listed below is a composite, based on actual trading data from a large market of relationships, of the exchange rates for various relationship activities.

1 day apple picking : 0.75 nights of Poker with the boys
1 week trip with mini-baller friends : 1 asking my gf to move in with me
1 night hanging out with “her” friends : 350 days not hanging out with her friends
1 Brazilian Bikini Wax (for her) : 0.86 trips to Ikea : 0.15 Bikini Wax (for me)
1 unit of taking out the trash : 1.64 nights of her making dinner
1 visit to her family for Christmas : 78 relationship points : 3.4 years of not visiting her family for Christmas
1 affair with her two best friends at the same time : 2 testes (fixed rate)
1 day of watching football : 2.5 hours of Sex & the City : 1 hour of Maid in Manhattan
1 dinner bought by me : 0 anything (based on the rational expectations theory of relationships, you are not compensated for things that are expected)
1 thrown out favorite t-shirt : 1.4 weeks of nude sleep
1 fantasy draft at her apt: 6 months of paying for a cleaning woman to service her apt
1 shopping for bathing suits with her : 17 years of therapy for me

Following our research on Domino’s (NYSE: DPZ) attempt to market pooplets as a viable food offering, we discovered what may be an earlier product. Kopi Luwak coffee is created by a unique process outlined well in the article, The Straight Poop on Kopi Luwak Coffee:

Years ago I heard a rumor of a rare coffee that was collected from the droppings of a wild animal. For quite a while, having nothing to substantiate this I had dismissed this as either an urban legend, or something so rare I was unlikely to ever have access to it.

…

[What’s] this luwak critter? Known as the luwak, luak, musang, toddy cat, civet, palm civet and civet-cat, many people believe it is a wild cat. While it is a mammal it is actually a cousin of the mongoose. Probably it’s closest North American counterpart is the skunk with which it shares the ability to excrete a noxious odor from scent glands near it’s anus.

…

The animal can range from four to eleven pounds and is largely nocturnal. While it is an omnivore, the luwak is particularly fond of perfectly ripe coffee cherries. Thanks to coffee farmers, the luwak has no troubles finding plenty of coffee.

Once eaten, the coffee cherries take the normal route through the animal’s digestive path. The amazing thing is while the fruit of the coffee is being digested, the bean is left largely unchanged, eventually passing in the animals droppings.

The droppings and their caffeine-laden content are collected by farmers. The coffee is then cleaned and the green, un-roasted bean shipped to roasters.

From there, Kopi Luwak is peddled to the least discriminating, most easily manipulated and most drug addled consumer base in the world — American coffee consumers. Filtered dirt water is essentially a gateway product to consuming shitquids.

Recommendation: Which came first Domino’s delivery pooplets or coffee bean pooplets? We will leave that to the scientists and historians to judge, but what is clear is that there is a definitive secular trend towards the American consumer warming up to eating shit.

We have all the reasonable basis we need provided to us by Def Comedy Jam’s trailing episode schedule. Look no further than episode 9:

October 29, 2006
Guest: Joe Clair, Jasper Redd and Mark Curry

Recommendation: The show has not been anything but stale since mid-90’s, languishing in the market, but the end must be near if Mark Curry appeared on it 15 years since he starred in Hanging with Mr Cooper. The catalyst for a full on crash in trading levels will be news of a Sinbad appearance.

Saturday was the day of days, the culmination of hundreds of hours of learning esoteric, mostly useless crap that you will now ignore for the rest of your professional careers. The Level I CFA Exam took place around the world.

To 50% of you: consider another career path! You failed to obtain Part I of your financial merit badge triforce. But thanks for making my life easier, stock brokers.

To the girl with the lucky Hello Kitty pencil case: You were so unnerved at not being able to bring your case into the exam that you probably failed, thank you for being a moron and helping the curve.

To the 20% of you who were women: Enjoy a career of persistent ingrained sexual harassment and marginalization at the hands of men who have been taught by experience and by their mothers to never trust anything which bleeds once per month or anyone who doesn’t drink and have sex with chicks. Perhaps look for related sexual harassment arbitrage opportunities.

To all those who took the CFA: Congratulations on taking the C.F.A. and guaranteeing a career of superior investment performance!

This post was calculated in accordance with the Global Investment Performance Standards

LoS is listed on the 1st page of Google Results for “hot boobs” and it is our most powerful search engine term according to the trailing two weeks schedule from Google Analytics. All thanks to our research report Save These Hot Boobs from Cancer.