That some should be rich shows that others may become rich, and hence is just encouragement to industry and enterprise. Let not him who is houseless pull down the house of another; but let him labor diligently and build one for himself, thus by example assuring that his own shall be safe from violence when built.
-Abraham Lincoln
Past Quotes Entirely Relevant to Investing
Long or Short Capital is dedicated to bringing you all the most recent developments in the buyout world? Accordingly, it would be remiss of us to fail to note the arrival of Carl Icon on the blogging scene via his new entity Liquid Icon Capital.
Hey, Carl — holla!
A macro trend that has concerned us greatly is the ability of the “family of four” unit to afford the modern American life. In previous generations, the FoF could afford any leisure they saw fit from sporting events to theaters to mega yachting; they could use the remainder of their moneys to run family farms which were crucial to soaking taxpayers for billlions in subsidies and ensuring that sugar was replaced with corn syrup in soft drinks.
Now the FoF unit is being priced out of the market, especially with respect to leisure. Consider that to attend a single baseball game at Fenway Park in premium seating would cost a FoF over $300; a sky box would be even less affordable. A trip to the movies would run an FoF almost $50, factoring an egregious amount of popcorn and a cadre of large ice pirates (note that the lack of the ability for any FoF to afford this leaves the $113mm domestic box office results of the Pacifier entirely unexplainable). Dinner at Nobu would cost a FoF nearly $300 assuming mom and dad wanted to tie one on. 1lb of commercial grade cocaine would cost $2,000 and a 140ft tri-deck mega yacht would run up a $28mm bill, completely out of reach for many FoF’s.
As you can see, just to attend a Red Sox game, go to the movies, eat dinner at Nobu, consume 1 lb of cocaine and buy a custom made Mega-Yacht would cost the avg FoF an astounding $28,002,650 per day. What kind of world are modern American children being ushered into, when obscene luxury is no longer a positive right?
Here is a list of affordable leisure activies for a FoF in the US:
Recommendation: Enjoy your excessive wealth and ignore the wahwah’s of the underclasses.
An Ode to Powerpoint:
While you were making your [PowerPoint] slides, we would be killing you.
-Russian officer commenting to a US offier on who would have won if we had ever actually fought WWIII in Western Europe.
Past Quotes Entirely Relevant to Investing
I haven’t seen such appropriate names since Michael Stonebreaker played football at Notre Dame.
Now if Tim Koogle, former CEO of Yahoo, would only work for Google.
Coming in the future: Inappropriately Named Executives
A loss never bothers me after I take it. I forget it overnight. But being wrong, not taking the loss, that is what does damage to the pocketbook and the soul.
-Jesse Livermore
Past Quotes Entirely Relevant to Investing
Like a company that has expanded outside its core business, Snoop Dogg has overextended himself. He has peaked and is ripe to be shorted.
Snoop Dogg has rebranded himself repeatedly, going as:
He lacks focus and recently has gone even further afield. He has appeared in advertisements for Chrysler, promoted hot dogs, and performed cameos in multiple movies. He even went so far as to produce his own porno film.
All this means that Snoop Dogg’s returns on incremental capital have been falling rapidly and are much lower than those in his core competency, the writing and production of degrading but catchy gangster rap. Furthermore, his frequent name changes have diluted his core brand.
Recommendation: Short Snoop because his returns are the big double drizzle.
You: So did I tell you about my portfolio? It’s totally kicking ass, and that Oil Conglomerate Search Engine company is going to be the name of my new boat. Also that Commodity Producer Consumer Electronics company has been generating stellar returns over the last 6 months. It’s green every day. I should just start my own fund. I AM THE MAN.
You: So I read in the Journal today, [insert anything].
You: So I’m mulling over this fantasy baseball trade. My definite keepers are Abreu, Ortiz, Mariano, Chavez, Podsednik (not a solid keeper at all, but will take care of steals). Then I have King Felix (for whom I’ve gotten offers from 4 people) Buerhle, Clemens, Schilling, Damon, Brian Roberts, Ensberg as my potential 6th keeper. I’ve done everything I can to move either Chavez or Ensberg starting 2 seasons ago and no one will bite.
So I can keep King Felix, or trade him for Buerle, the third pick who would hopefully be someone who slipped down, and a 9th round pick. My thoughts are that these picks will help me fill my roster a lot faster so I can get more closers and potential sleepers earlier than other people. But, I’d be trading away the best prospect in baseball. What should I do?
You: [Any story involving golf or fish or boating where someone does not die or at least get maimed by sonar]
You: My son/daughter/dog did the cutest thing yesterday…[insert anything].
You: I killed a family of four and my company covered it up.
You: YIELD CURVE!!!!
If one is forever cautious, can one remain a human being?
-Aleksander Solzhenitsyn
Past Quotes Entirely Relevant to Investing
We are revising our guidance down for our Q3 revenue projections. Current contextual CPC advertising is down 60% sequentially period over period. Although our spirits are buffetted by our Infinite% improvement in YOY Q3TD growth, this is probably due to a slight misunderstanding of basic principles of logic and arithmetic. Static text ads are performing as expected, while Blogads is only slightly below plan at $Pretty Good in attributable operating cash flow.
After an unstensive SWOT analysis provided by a NDA-bound third party consulting firm, we have reached a 5 Step Plan to Profit, which we will refer to as Operation Sir Click-A-Lot.
Step 1. Improve efficieny and apply six sigma concepts to our process; scrap Kanban JIT manufacturing concepts and move to scheduled content delivery, while keeping enough capacity to provide humor to the spot market selectively when prices are attractive.
Step 2. Headcount reduction. We have reduced our staff by 14% by rationalizing our call centers and by cutting our Chief Compliance Officer, who provided neither Compliances or Offices in his 2+ months on the job. This has realized cost savings on a pro forma annual runrate basis of $Div/0.
Step 3. Seek strategic relationships and selective syndicating and licensing opportunities. We have some initiatives going on behind the scenes, and one consumated deal to announce as as the details are finalized. We expect this deal to be cash accretive out of the box, as well as both traffic and awesome accretive: expect a whole lot of accretion action. Our IPO is in the works but will be delayed until the market is more robust.
Step 4. Implore our readers to reread the name Operation Sir Click-A-Lot and beknight themselves.
Step 5. Hope our readers aren’t Stanford Grads. Profit.
As it is, dividends are under pressure due to our high subscriber growth without in-line revenue growth; at these depressed levels we are at risk of a hostile takeover from a consortium of well-funded private equity firms, or a possible restructuring play by a savvy distressed investor whose first move would be to crush the equity.
In this installment (Read Mr Juggles Investing Commandments #1 and #2), the focus is what you can discern from a company’s investor relations team.
Pickup any newspaper and you’ll see stories about the rapidly growing Chinese economy. Most observers also know that the Chinese advertising sector has particularly strong prospects since advertising tends to comprise a much smaller part of developing economies relative to developed countries and this gap closes over time. But pundits have overlooked another key driver for the Chinese media and advertising sectors: the military host. These military hosts were a secret until Long or Short ventured onto the mainland in order to obtain shots directly from the CCTV feed. As you can see, military officials regularly appear on television, exhorting viewers to continue watching or risk imprisonment. This bodes well for advertising generally. Can you imagine the ratings “Good Morning America” would get if Rumsfeld hosted and those who didn’t watch were drafted into Iraq?
Recommendation: Long Chinese media and TV advertising plays. Long snappily dressed military announcers. Short Katie Couric.
Long or Short Capital continues to diversify ethnically which we think is crucial to any investing strategy. We have renamed Equity Private to Julio Mezzanine Tranche, but you can refer to Julio as “the Mezz,” or alternatively, Senor Tranche. The last title may be a little too formal for Julio given his status in the capital structure and the extent of his legal rights, but we’ll see, as the possibility always remains that he will be a real bitch in a workout. Julio remains the anonymous author of Going Private which is an epic meditation on intangibility and private equity.
Full Disclosure: We are both long AND short Racialistness.
This one goes out to all our hard-suffering CPA-studying accountant readers:
Accountancy was my life until I discovered Smirnoff.
-Vodka advertisement from 70’s
