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Totally Rad Mini-baller Ski Lingo

A few mini-ballers went skiing over break and met some stoners in the gondola who taught them all some coloradical ski lingo. Of course the mini-ballers were enthralled with this new vocabulary and proceeded to overdose on the new found choices piece of diction. A brief guide in case you want to “make some convo” on the lift this year.

Shred the gnar – ski/ride in a totally sweet way. “Yo bra, we shredding the gnar today or what?” (can also use “shred the gnar-gnar” for additional emphasis on how much gnar you intend to shred)

Gnar-buckets (n.) – the receptacle for the gnar after you shred it. “Bra, I filled up like 6 gnar-buckets working my boards on that glade”

Hit the freshy pow-pow – Ski/ride in new-fallen snow. “Wake up kid, you looked outside yet? We’re gonna totally hit the freshy pow pow today!”

Sesh it up – definition unknown but if asked this the answer is always “yeah man”. “Did you sesh it up that time?” “Yeah man.”

Over-Under – a game skiers play whereby one skies under the other’s legs. “Dude over-under looks kinda gay but it’s actually pretty gnar”


Bloomberg Headlines, 2007 vs the Future

How bloomberg headlines read in 2007:

Crude reaches new high up 2% to 89.30 nearing Goldman $100 target. Citigroup shares fall below $30 on further writedowns of $5bn

How bloomberg headlines will read in the future:

Dollar reaches new record low -2% to 0.011 barrels of oil nearing Goldman target of 0.010. Citigroup shares fall below 0.34 barrels of oil on further writedowns of 56m barrels of oil.


How To Destroy An Analyst by POT

Bill Doyle the baller CEO of Potash Corp (NYSE: POT) recently crushed the spirit of an analyst on a conference call in a swift and brutal way that made even all of us here at LoS (who hate bad sell side research) cringe. The unfortunate recipient of this de-pantsing was Charles Naberg who had recently initiated on the fertilizer industry. He asked an innocent enough question about some capacity expansion on the 3Q call and got a terd-filled sock shoved in his mouth as a reply:

Charles: “Hi guys. Nice quarter. Had a quick question on Lanigan. How is that progressing? Is it still on time for the middle of this year — or this coming year, excuse me, middle of 08? And can you remind me about what the size of that addition is going to be?”

Bill Doyle: “Yes Charlie [ed note: he was introduced as “Charles” and the this is the first time they have ever spoken to each other], to answer your question, what I would tell you is that Lanigan is 1.5 million tons. It’s on budget and on time for next year. You know, essentially the big piece there is the mill. So we see that progressing according to plans.

You know, I read your first entree this week into the potash world. First I would say welcome to the fertilizer world and I did have just a couple comments, Charlie, just because I never have a problem with anyone’s call, you make whatever call you want, but some of the factual information in your report was a little bit suspect and I would say the — you know, the comment about Potash Corporation abandoning our discipline and I don’t know what the line was, something about us being out for pizza or doughnuts — it was cute, but if you follow the history of the company, you’ve got the same management team for the last 20 years and if you check back and do a little research on us, you’ll find that we have always matched supply to demand and it’s not how much capacity you have, it’s how you operate that capacity, Charlie. And the other thing I would say is that you know, you referred to Potash mining as being high fixed cost business. Potash mining is not a high fixed cost business. You know, we can lay people off and shut down the operations. We’ve done that for years and years when the time required it.
Unlike our phosphate business, which is a high fixed cost business, because you’ve got to keep that operation hot, so-to-speak. You’ve got sulfuric acid plans, you’ve got to keep your water pumping capability in the mine site. You just really can’t shut that down. So, there is a difference there that we would be happy to try and explain to you in the future.

[On] Our earnings being highly dependent on biofuels – three quarters of the new demand growth in our business is food demand. We’ve tried to talk about that at every stage and what I would really suggest to you, I think you know, you covered a little bit on the supply side, you didn’t talk at all about the demand end. And I would say go out, visit India, pick any five cities, China, any five cities, and you’ll see the demand for food and it’s a very, very real issue.

You know, the other comment about consumers banking inventory before the Spring season of 2008, that’s just impossible. Just isn’t inventory out there and everybody is hand to mouth at this time. So I would say you know, overall less than a distinguished effort but the good news is that there is nothing but up side for you for the next go round.

Now we have a website question here that I would like to answer.”

Recommendation: Don’t eff with Bill Doyle and don’t eff with POT.


Is Hotness a Store of Value?

Gisele Bundchen is the richest, most powerful and the most currency-savvy supermodel in the world. Ben Bernanke is the current head of Fed and an afficianado on helicoptering. Below is a short excerpt from a debate between Gisele Bundchen and Ben Bernanke on the topic of the US economy, the weak dollar and the sub-prime loan crisis. Hosted by Jim Lehrer.

Jim Lehrer: First question for Gisele. Gisele you’ve recently announced you will no longer accept payment from modeling jobs in dollars. Can you talk about that decision?

Gisele: Well I was partying at Bugee in London recently and an American was trying to grease the bouncer to get in. He dropped one of the dollars he had in his hand on the ground and the bouncer looked at him and said. ‘Hey, pick up that trash’. I thought it was funny because the same guy had just thrown his cigarette butt on the ground and the bouncer didn’t seem to care about that. I got to thinking – are cigarette butts more valuable than dollar bills? So I changed my policy to protect my assets. Like gold and oil my hot assets have intrinsic value and are immune to inflation, I thought my contracts should reflect that.

J: Ben, your rebuttal?

B: I believe that the Federal Reserve’s success in reducing and stabilizing inflation and inflation expectations is a major reason for this improved economic performance.

J: Ok, good one Ben, but if inflation is under control why is everyone selling their dollars?

B: The Federal Reserve is committed to maintaining low and stable inflation and I’m very confident that we’ll be able to do that.

J: Genius. Gisele, back to you. Exactly how hot are?

G: Well that’s interesting because I’ve been trying to decide that myself. My old answer used to be “pretty f*cking hot”. But when I tried to have my assets insured the insurance company wanted a “more meaningful agency rating”. So I showed my assets to S&P and they rated them AAA which I felt was pretty good until I found out subprime loans have the same rating. Now I’m just a dumb model but come on I’m WAY hotter than a basket of subprime loans –

J: Great points. Ben, would you rather have a basket of subprime loans or have Gisele show you her assets?

B: Decisions of the Fed are made in conjunction with all the members of the board and I am not in a position to comment on future actions. But I will — YES.

J: It was an either or question.

B: I know. My answer remains YES.

Fin


WSJ Follow Up to Finance is a Scam

Today, the WSJ has an article on the recent syndications in the leveraged loan market of formerly hung deals that outlines in detail the “Finace is a Scam” piece from JD last week.

Yet for all the relief among bankers, the sales haven’t come easily — or profitably. They have offered only the highest-quality portions of the debt for sale, and that at a loss. They have also made concessions that could come back to hurt them, such as selling the debt at a discount while the huge supply raises questions about how long both Wall Street’s united front and the upbeat mood will last.

So far, what has been sold is a drop in the bucket. Standard & Poor’s Leveraged Commentary & Data estimates that about $30 billion of a total of $310 billion in North American LBO loans have been sold so far. As much as $100 billion in debt is due to come to the market in the next 30 days alone.

A week before the W Hotel presentation, banks successfully orchestrated the sale of the first big chunk of the $24 billion debt for the First Data buyout. They surprised even themselves by selling almost double the amount planned. The bad news: to accomplish that they agreed to sell the debt at 96 cents per dollar, locking in losses after their fees were figured into the deal.

In some cases, private-equity firms whose deals the debt is financing were among the bigger buyers of the debt. KKR, for example, expressed interest in purchasing a large amount of First Data debt, eventually receiving a $400 million allocation, according to people familiar with the deal.

Recommendation: A portion, if not all, of that $400mm First Data ticket from KKR was financed by Citi. $400mm is an extremely large amount of loans to buy in one deal. Citi and other banks probably provided similar financing to other hedge funds and private equity players; essentially on a net basis, not really selling these loan assets but paying a fee (on top of the discount 96 price or whatever) to get these loans off their books and getting publications to report that these deals have cleared the market with the hope that the banks can then move the rest of the overhang, which is an actual order of magnitude larger than what the banks have moved since the credit crunch began. But don’t worry, credit markets are fine!


Examining The E*Trade Engine

E*Trade (NASDAQ:ETFC) is a discount broker known for delivering low cost and mostly terrible execution to the investing plebes. How do they achieve such low costs? It’s never been clear how they achieve such low prices, aside from under-staffing, offering terrible customer service, and failing to function when you need them most. But the key to their low cost ways has been revealed. On their front page, they are frequently displaying this image:

From this, we can discern their trading platform was created by forming an LCD computer monitor to a 50’s drag racing engine. The result is a foul chimera that spews a trail of green flames as it ensures its customers get the weakest price possible.

Recommendation: Aside from the possible environmental ramifications of green flames (well known to be associated with the guano fuel source), we have to question if this is the best way to achieve execution for their customers. Our estimates are that the actual engine is almost 84.8% useless, and given the unlikelihood that a heat sensitive component like a CPU could be housed in that engine, we question whether that machine is capable of any computing whatsoever. In all likelihood, the LCD monitor is just displaying random gibberish that looks “stock brokery”. Short E*Trade; we think there is a catalyst for a sharp diminution in E*Trade’s valuation as more evidence of their shaky trading platform comes to light.


European Cost Saving

CEO: We saved 300m this year.
ME: But reported costs were up 200m and production was flat.
CEO: Well we measure our cost savings vs budget.
ME: Well what was the budget?
CEO: It was to spend 300m more than we did.
ME: Who came up with such a crappy low expectation budget?
CEO: Me.
ME: Cool. . .well done.


On Liquidating Your PA

Do:
Contact your broker and say “Sell! Sell! Sell!”

Don’t:
Contact your broker and say “Buy! Buy! Buy!”. This will lead to liquidation, especially if your account is of the margin variety, but it will take a few more weeks and involve having no money left.

Do:
Wear a whale belt. Let the market know you still feel Nantucket, even if deep inside you know you are Jersey Shore now that the market’s scythe has reaped what you have sown.

Don’t:
Drink heavily. Yet. There will be plenty of time come Friday to reenact The Lost Weekend. The drugs don’t work, but the sauce does.

Do:
Invest your new newly found liquidity in sexy parties. Sexy parties are one of very few assets with no-downside

Don’t:
Invest your money in stocks, bonds, phantom bonds, subprime mortgages, hedge funds, put options, call options, securities, US dollars, New Zealand dollars, Renminbi, currencies, real estate, gold, commodities.

Do:
Yell. Primal screaming has proven therapeutic effects. We read this on the internet.

Don’t:
Worry. Now that you aren’t invested in the markets, they can only go up.

Possibly Fake but very Full Disclosure: I own nothing


Cerberus: Den of Mini-Ballers or of Satan?

Portfolio.com has a portrait of Cerberus Management founder Stephen Feinberg.

Some choice quotes:

But then, Feinberg is not trying to win a popularity contest.

No shit, really?

There is little at the office to distract staffers from the business at hand—almost no art on the walls, no fancy woodwork. “It’s not a place you bring clients to impress them,” says a former employee, who adds that those in the satellite offices refer to headquarters as the Death Star.

“His ego is having no ego.”

Do real people say things like this about people? Have you ever thought about one of your colleagues or friends something along these lines? “He has an 800lb gorilla on his back, and its the desire to make money for his clients.” Do Business rags just make this up?

“Steve didn’t care. He was a get-it-done person, and he wanted to get it done.”

Mini-baller?

They named their new company after the three-headed dog that guards the gates of hell in Greek mythology. The company has long held that the symbolism refers to the fact that one eye is always open, presumably protecting investors’ money.

The symbolism refers also to the fact that Cerberus Capital Management serves at Hell’s pleasure.

Recommendation: We recommend a Steve pair trade — long Feinberg, short Schwarzmann, a bet on Stevevergence. Feinberg may be a “get-it-done” person, but minions of the dark lord are excluded from mini-baller status. (Aside to Portfolio, how could you not mention Cerberus deals which aren’t getting gone? Or are they getting done?)

HT to reader Kyle S


Sweet Pickles

Accusing Alligator Dan Loeb

Sweet Pickles are a series of 26 books each about an anthropomorphic animal who is alliteratively named for a letter of the alphabet (eg. Bashful Bear, Clever Camel, Doubtful Dog). The characters are hyperbole’s of their stereotypes and predictably teach kids a life lesson along the way. We highly recommend them if you have kids; if you don’t have kids get them anyway – they’re great if you are stoned and giggly and tired of watching Family Guy re-runs.

What we want to do is brand oft-discussed investors, CEOs, and other finance personalities with a Sweet Pickles name that is so fitting it becomes permanently attached to their persona. For example Dan Loeb, we love Dan Loeb but we think he is a bit of an “Accusing Alligator“. Just like the character, if someone stole Dan Loeb’s shoe he would probably blame anyone he could find, even Loving Lion. If our plan works by next week you’ll be at a conference and overhear something like “. . . yeah the short was working great and then Dan Loeb wrote a letter that I needed a thesaurus to read and all it really said is that he thinks the CEO is a homo and now the stock’s up 20%, I mean what an Accusing Alligator that guy is”.

We’ll try to intersperse these whenever we’re recommending long or short positions in our favorite Wall Street divas. If you have an idea put it in the comments or send us a short post and we’ll help label that whiny CEO a ” Temper Tantrum Turtle”.

Accusing Alligator – Dan Loeb
Bashful Bear
Clever Camel
Doubtful Dog
Enormous Elephant
Fearless Fish
Goof-off Goose
Healthy Hippo
Imitating Iguana
Jealous Jackal
Kidding Kangaroo
Loving Lion
Moody Moose
Nasty Nightingale
Outraged Octopus
Positive Pig
Questioning Quail
Responsible Rabbit
Smarty Stork
Temper Tantrum Turtle
Unique Unicorn
Vain Vulture
Worried Walrus
X-Rating Xerus
Yakety Yak
Zany Zebra


Money – Get it while it’s Hott

LoS has been bringing you sweet sounding jargon to throw around the office, the bar, the club, and the “common room” of your crowded city apartments. First we brought you “Get It Done” which has taken off worldwide with word of mouth success even we couldn’t have predicted. No doubt you’ve also noticed our excessive use of the word “money” but of course not as a noun, as an adjective. Nothing says “I have a lot of something” like whimsically changing its part of speech.

We aren’t the first grammatical hipsters to come up with the idea. It started back in the 80’s with “dope” which was originally a noun that meant “drugs”. Then people who were carefree abusers of drugs overused the word saying things like, “That is a dope car my man”. This showed that they were hip and nonchalant when discussing illegal substances and also implied that ‘drugs’ was a synonym for ‘cool’. Well at LoS we say no to dope-drugs but we say yes please to ca$h-money.

If you’re wondering how to smoothly start using ‘money’ as a modifier, we recommend you begin with clothing, something simple like “Those are money shoes my man”. Once you have the hang of it you will be pointing out money cab drivers, money overhead bins, and money Bloomberg functions. You should hurry though, it seems the UK government is already on the bandwagon with their new recruiting drive for “Money Doctors“.


I’m Calling the Top, today. My ten signs:

  1. Shares of Odyssey Marine Corporation (NYSE: OMR) recently doubled when they announced they found sunken treasure.
  2. Microsoft (NASDAQ: MSFT) (supposedly smart people) paid 38x EBITDA for a company that has half its earnings from a product that Google will probably offer for free.
  3. Sotheby’s (NYSE: BID) stock price has predicted the last two recessions and is predicting another any second:
  4. Dog Yoga
  5. Shares of the Berlin Zoo (BBERG: ZOO.GR) recently doubled due to the birth of a baby polar bear named “Knut“.
  6. Private Equity firms in search of stable cash flows are buying Qantas and Iberia – they are airlines. In case you’ve been dead for the last 50 years, airlines are not in the steady cash flow business.
  7. Blackstone, a company built on the advantages of private vs public ownership, is going public.
  8. Actual NYTimes headline: “At Cannes This Year, the Bankers May Outnumber the Movie Stars”
  9. Michelangelo Volpi left his position as the head of an $11 billion division of Cisco (NASDAQ: CSCO) to become the CEO of startup Joost, which just raised $45mm of VC funding. And he isn’t crazy since Joost will likely be acquired for $40 billion in 2 months, or roughly 5 billion times revenue or negative 30 million times their projected 2010 cash flow.
  10. Chinese solar company LDK Solar traded down after its IPO. That was a disappointment since two weeks ago China Sunergy shot up 51% after its IPO. In fact, there have been 9 solar-cell IPOs since Dec05 with yet another — Yingli Green Energy Holding — coming this week. Point of interest: LDK’s CEO was a shoe salesman 5yrs ago. Today he is worth roughly $1bn.

Addendum: Ours go to 11.
11. China.


Save These Hot Boobs From Cancer – TRUMPED!

Only a few short months after announcing our Save These Hot Boobs From Cancer (STHBC) campaign our idea has been pirated by real live people. “For the Love of Boobs” was kicked off in London this month with these bus adds creating a boobylicious buzz all over town.for-love.jpg

If there was any doubt that this campaign was designed specifically to preempt our imminent launch of STHBFC I suggest you look at the facts:

Our premise was two fold a) Have a catchy title that made explicit use of the word ‘boobs’. b) Deploy a collection model based on our primary research into hot boobs:

“The best people in the world at getting/raising/borrowing/stealing money are smoking hot chicks. Chartible organizations need to penetrate the industry leaders in solicitation— beautiful women. A first mover will have an enormous market opportunity.”

For the Love of Boobs has leapfrogged our own clever titty cancer launch and now we are playing catch up. Following our advice they then hired Sophie Dahl as the spokeswoman. She is famous for her raunchy perfume adds that were banned from the streets of London. In Paris (where they were not banned) they were famous for sending homeless men into a frenzy. Those are the kind of boobs we need to employ if we hope to put an end to breast cancer.

This deliberate plagiarism is calling into question LoS’s entire business model. Until now we had assumed that coming up with genius business plans and investment ideas and then writing about them online = profits. Apparently we were wrong, we have initiated an extensive internal strategic review to figure out who got it wrong, who hired the guy who got it wrong and then to fire both of them and start getting it right. We will be back to you with the results on our next quarterly call.

Until then you should probably go buy some hot boobs t-shirts to tell the woman you love that sure you care about her, but mainly you care about the health and safety of her “groceries*”

*Insert any noun here and add an “s”. Everyone will know what you mean.


Motivated Prostitutes, the Opposite of Lazy Unions

Italy has prostitutes and these prostitutes have rights. One small Italian mayor is trying to eclipse those rights. Last week he passed a law making it illegal to obstruct or slow traffic for the purpose of soliciting sex. The soliciting sex part is fine, it’s the obstructing traffic part that concerns him enough to slap the offense with a €50 fine. Well the prostitutes of Padua had enough so they decided they’re not going to take this sitting down, they are going to take this lying down, on their backs. The upset ladies are protesting by offering sex for the low low price of “on the house.” That’s right, to protest this injustice they are going to bang, constantly for zip, zilch, zero, nada, goose egg, perf – perf, 0 euros. The women participating will be wearing pink ribbons to let their customers know. Sidenote: These are just the kind of girls we need for the Save these Hot Boobs from Cancer campaign.

When unions get wronged, mad, or bored they protest by REFUSING to work and they STILL get paid. Then there’s prostitutes, when they get pissed they get even by STILL going to work and REFUSING pay. That is getting it done. There is the one small problem which is that this method of protest doesn’t really set up the right incentive structure: “So what you’re telling me is you’re going to have sex with me for free until I repeal this law? And if I repeal this law then you’ll go back to charging me? Ok, yeah let me think about what my best option is but first why don’t you get in my car so you don’t get a 50 euro ticket you pretty little thing.”

Even though sometimes they’re not the smartest I’m still long hookers and obviously short unions.


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