Long or Short Capital

Update: All culled posts are deleted as of 1/4/06.

We recently learned about how the Japanese make up the history in their textbooks so that little Japanese schoolgirls never have to learn things like that the Japanese wantonly murdered hundreds of thousands of Chinese in the Nanking massacre or that being able to buy used panties from a vending machine is pretty weird to human beings on planet Earth. Applied to the business of creating business humor online, we think this technique could help keep our own “Japanese schoolgirls” (our readers) from ever knowing the dozens of horrors we have created in failed posts.

Here is a list of Six Posts I’m deleting on Wednesday and specific reasons why they were failures.

Underground Toy Market Is Really a Front for Drugs — No story there. No real business connection, no humor, little truth. Deep, you sucked on that one Bro.

Outsourcing My Thoughts On Outsourcing: Pt 2 — Great concept but in practice worthless, as some readers pointed out (cruelly you cruel bastards). $40 poorly, even if interestingly, spent. Part 1 will remain, but part 2 is to be culled.

Internet Shadow Advertising Market — More like Rotatebad.com. An idea is useless without support and execution.

Charity Pie Revenue Maximization — Who gives a crap about pies? Or charities for that matter? To think, I spent time reading that that could have been spent managing the immigrants who wax my yacht. Next.

Will you replace BloggerSwap.com with the Choo-Choo’s? — I would rather raze the internet and salt the Earth with BloggerSwap’s corpse than leave any mention of that hideous traffic scam existant on the Web.

The Difference Between Looting and Finding — This came from a third party provider.

We just want our subscriberholders to know that Long or Short Capital acknowledges failure; then we destroy it.

Most fancy restaurants and hotels offer steel-cut oatmeal. But, last time I checked, steel is not that hard a substance. On the absolute hardness scale, it rates an 80 or 90 as compared to 1600 for a diamond. Until I can feel diamond dust in my bowels, there’s good money to be made in oatmeal.

Continuing with our earlier analysis of a potential pillow pair trade, our staff has recently upgraded our position on exotic plush pillow makers from “Do Not Buy” to “Maybe Buy.” Reasons for the upgrade include strong YOY growth in plush pillow sales volume, especially in the very competitive food facsimile space, despite tough comps as well as the broadening demand as people recognize the excellence of novelty plush. It doesn’t hurt that Kaiser sleeps on this every night.

Hamburger Pillow:

This is the biggest Cheeseburger ever! With this big Cheeseburger pillow, whether you are watching TV or taking a rest, it will provide you with the best comfort! It is very soft and cuddle! There are cheese, lettuce, and beef inside.

Recommendation: We maintain our “Long” rating for pillow makers with emerging market focus, and our “Short” rating for domestic pillow makers, while upgrading Exotic Plush Pillows to a “Maybe Buy.”

Say Forever I Do with an uncut bag o’ diamonds “mixed with the natural elements they are found.” Perhaps the missing link from diamonds to the Idiot Demographic.

Long or Short Capital has completed extensive fundmental analysis of the pillow market. After surveys, studies, and focus groups a few conclusions have become obvious:

Pillows are most often used by consumers for sleep-assistance purposes although they can sometimes be used for back support and/or playful fights in sorority houses

The optimal Full Pillow Equivalent (FPE) to Human Head ratio is approximately 1.0x

Pillow pricing is directly proportional to the average number of frills per pillow as well as the number of fabric colors per pillow. Pricing is generally inversely correlated to the utility and comfort of a pillow.

Some of these conclusions are surprising given the current state of the pillow market. For instance, in the US, FPEs per Human Head are running at almost 3.4x vs. the 1.0x optimal level. Note that this estimate includes almost 6 decorative pillows per household (or 1.2 FPEs). Meanwhile, FPEs per Human Head are approximately 0.1x in developing economies such as Malaysia and Zimbabwe and around 0.6x in China, the world’s most populous country.

We feel strongly that these trends will converge in the long term with the US (and Europe, to a lesser extent) reducing their consumption of frilly, non-functional pillows and developing countries upgrading from rocks to pillows for head support. Our surveys of starving third world citizens find that pillows run fifth on desired items following only clean water, freedom, blond hair and Pampers for the kids. This presents an attractive investment opportunity.

Recommendation:
We are recommending a pair trade: Go long pillow makers with emerging market focus and short domestic pillow makers.

This post could have been titled “We tried to sell-out but Google wouldn’t let us.” Why wouldn’t they let us? Because Google’s Firefox referral is a complete abject failure — we didn’t get paid for any of our referred downloads. Live and learn. Bye Google referral, we’d rather invest our money in lime futures than waste sidebar space with your link.

This week we have better sell out. Adverts in our RSS feed. Yahoo finally has them and we’re going to stick them in, and report the results one week from today. And you’re going to love them because who doesn’t love ads???

I’ve often heard that you can spot tourists in NYC or San Fran because they are the ones staring up at the buildings. But I realized today that if you follow that advice, you always end up mistaking architecture students for tourists.

Quarter-to-date performance has been excellent and revenue is growing in the low triple digits. The subscriber base has been growing at a modest rate, so Longorshort has exhibited significant dividend growth leverage. Via my model, the implied current market capitalization of Longorshort is $12,545 and each subscriberstake is worth $193. To be fair, my model wasn’t designed to analyze this kind of investment, but it is otherwise incredible in its brilliance and accuracy.

Cash flow. We all know what it is. Everybody wants some. In light of our new Long or Short Capital dividend policy, we need it. But how do we get it?

Simple. Sell out as much as possible. Each Saturday we will try and take it down a notch and whore ourselves in new and shameless ways. As part of the deal, the following Saturday we’ll let you know how successful our greed was.

This week’s sellout: Download the limited edition Firefox through the button on the top left of the sidebar. This only applies to people who don’t have Firefox installed already.

You can put cash money in our pockets and make us rich beyond your wildest dreams. Don’t know what the Firefox browser is and why it is good to use? Well we don’t know either, but rumor has it that it turns html into gold and sends it directly into your bank account. Either that or it makes you 4 inches taller and 3x as smart.

Each time you download Firefox and install it, use it, and love it, Google issues us a single share in their company. Or gives us a dollar. We’re unsure about that part.

Download it now before Google runs out of Firefoxes and has to make more.

Update: This will no longer work, since we removed the button.

Pending the routine audit of our 1st quarter results, Long or Short Capital plans to begin paying a quarterly dividend, using the cash generated by our hilarious operations to create value for our subscriberholders. The board considered a number of strategeric options including: a hostile takeover of Marginal Revolution, paying bums to advertise for us, and blowing all the cash on hookers and coke. Instead, we have decided to initiate a quarterly dividend of $1.

Our reasoning was simple: We realized that we value you, our readers, and now you will finally be able to value us. Literally. Assuming a $1 quarterly dividend, no growth, and an 8% discount rate, being a subscriberholder is worth $50.

Who are your subscriberholders:

Email and XML subscribers as of 10/28/05. These are the only readers we can reliably verify and who will be eligible for this quarter’s dividend. Additionally, we feel that they are also the stickiest readers and we are big proponents of RSS usage. They have the largest stake in us.

How does a subscriber collect a dividend:

For Email Subscribers: Send an email to misterjuggles@gmail.com from your subscription email with your paypal address and we will send you $1. Cash money.

For XML subscribers: Send an email to misterjuggles@gmail.com with the “Subscription Verification Code” enclosed (you should have received a “magical word” on Sunday in our feed). Enclose your paypal address and we will send you $1. Cash money.

All unused money will be reinvested back into the website.

What about your next quarterly dividend:

Our next quarterly dividend will be determined by the following formula. The lesser of $1 per subscriberholder or (80% of revenue) divided by the number of subscriberholders at quarter end. The latter formula would have yielded a $1.50 dividend, so the $1 dividend has quite a bit of cushion. After this quarter, we will require people to fulfill some sort of registration, as of yet undetermined, to be eligible. It shall be light.

We will also revise up the dividend if our revenue per a subscriber improves; we will never revise down or suspend the dividend without a proxy vote of registered subscriberholders.

Why are you doing this:

1. We will be the first and only site to issue a dividend.
2. This dividend cements our place among the elite internet companies. Please note that our quarterly dividend will be larger than that of Yahoo, eBay, and Google combined.
3. It combines finance with the absurd.
4. It turns our subscribers into stakeholders and incents them to grow our revenues, by bringing in traffic or driving themselves to our sponsors. We believe proper incentives can solve any problem, from internet site readership to global poverty. Hence our support of the Grameen Foundation.
5. We obviously are not in this for the money so this is a much more appropriate use of the ad revenue.
6. Numerated lists are pretty sweet.

How do I become a subscriberholder:

Use the buttons and forms at the top left to subscribe via email or XML. We recommend the latter, since Feedburner helped us with this process and we are totally long them.

All other inquiries should be directed to misterjuggles@gmail.com. The management of Long or Short are proud to be economists, who are utilizing incentives, science and research to improve the lives of the rich.

Risks and Uncertainties
Neither the SEC nor any state securities commission has approved or disapproved of the subscriberholdership securities or determined if this prospectus is truthful or complete. As a subscriberholder, you are being granted Class B shares in Long or Short Capital LLC. You should probably realize that Class A shares (there is actually only one Class A share and it’s held by Mr Juggles) have perfty-perf votes per share compared to 1.25 votes per share for Class B.

Our fiscal quarter ended on 10/31/05, and we had a banner quarter, our best quarter ever, thanks to the stalwart efforts of management and their compensation package which was heavily weighted towards long dated options in the company’s non-existent stock. We have a lot of skin in the game, so you should trust us.

Unaudited Financial Results for Q1’06

Income Statement

Revenue $109.03

Cost of Sales $0.00

Operating Income $109.03

Balance Sheet

Cash $0.00

Accounts Receivable $430,000,109.03

Inventory $3.99

Accounts Payable $3.99

Cash Flow Statement

Operating Cash Flow $0.00

Capex $0.00

Distributions $X.00

Performance Metrics (mix of Kanoodle/Blogads/Adsense/Yahoo)

Visits 81,431

Pageviews 143,151

Clicks on ads 402

Ad impressions served ~268,000

Subscribers by Email 30

Subscribers by XML 33

Inbound Links per Technorati 26

Inbound Links per Google 7

Readers are to submit questions by email to misterjuggles; if we get enough questions and of enough quality we will post a quarter end conference email in which we promise to cuss out any analysts who ask pesky questions. As a preface, let us just say that our own Project Propeller was an unmitigated success. We feel great about our first quarter, we are proud to have delivered earnings per a share of $DIV/0 and we will continue to build on our resume of greatness.

Investment analysis trumps political analysis yet again. Conservative originalist lackeyish with a hint of espirit de redeconstructionalism? Like that matters when the woman can’t dance.

Readers who read our reseach report on John Roberts and his familial ability to break-it-down knew that Miers’ nomination was doomed because the woman clearly can’t shake it herself and lacks any rug-cutting progeny. FYI to Harriet: the new court will hopping and if you aren’t getting down, you ain’t getting in.

Recommendation: Potential SCOTUS nominees should consider buying a dance pad and practicing in the confines of their own home.

I would like everyone to know that I am writing a future best-selling series of business books. It will be a syndicated series, kind of like Chicken Soup for the Soul. You know, first it was Chicken Soup for the Soul, then it was Chicken Soup for the Teenage Soul, then Chicken Soup for the Deaf Prostitute’s Soul, then the ground-breaking, recursive Chicken Soup for the Chicken’s Soul. My series will be similar and follow the formula Investing in Public Equities is like [Blank].

The first edition will be Investing in Public Equities is Like Dating. Here’s the idea: During one of the many rocky periods in a particular personal relationship, I remember asking my parents (married for 25 years) whether or not they had ever gone through tough times when they were starting out. Their basic answer: Relationships, despite what your girlfriend just told you, aren’t supposed to be “work.” “Work” is supposed to be “work,” hence the name. When a relationship is right there won’t be a lot of analyzing, discussing, and dissecting every aspect of the relationship as if it’s a third, independent entity.

In fact, finding a promising investment thesis is similar to meeting a new girl who might be dating material. Examine the similarities:

Dating:

Is she truly interesting? Can she take a joke? Does she come from a decent family (i.e., just how crazy will she be later in life)? Is she good looking all the time or only in dark bars? What do your friends think of her?

Investing:

Does the management team know what they’re doing? Does the company have sustainable barriers to entry in their key businesses? Is the company well positioned for the next 3-5 years? What do the company’s customers and suppliers say?

Sometimes — ok, a lot of times in Mr. Juggle’s case — things just won’t feel right even when the answers to most of these questions are positive. Just as a relationship can lack chemistry, a stock can look promising in theory but fail to perform. You will find yourself constantly justifying the stock to your friends, talking about how great the company is and how the chart is smiling at you. And much like your first relationship that you dragged on far too long, you’ll be tempted to “work through it” and stick around. Again, examine the similarities:

Dating:

I’ll put more effort in our relationship… Ok, I’ll try to change… I’m sorry…

Investing:

There was no operating leverage but we’ll see it next quarter for sure… They’ve assured me they have the financing in place…. The investment period is almost over…Management has a lot of “skin in the game”….

Listen to Juggles: Don’t do it.

Now the reason I think relationships are a particularly good analogy for investing is that it’s just as tough to know when you should cut your losses in a stock as it is when things go south with your girlfriend. You’ve been through a lot and there’s a shared history; is there something fundamentally wrong or are you just being impatient/unreasonable/(insert common male or investor characteristic here)? Finding an investment thesis is at least as hard as going back to dating, and you never want to bail on a good idea early. So ask yourself: the stock isn’t working but is this a healthy argument with your future wife or maybe you and the stock are fighting again because things just aren’t right between the two of you. Does the stock want you to “work on it” or “pay attention to its needs” more often? These are probably signs you should set cut that stock loose.

But don’t think it’ll be easy. The day you finally give up on that stock – it’ll go up 5%, just like your ex-girlfriend will wear a short skirt and slut herself around showing you how many other boys like her. But your better off man, you are way better off.

Recommendation: Long book writing, short dating.

That picture of Amazon CEO Jeff Bezos was taken in November 2002. How do you reconcile that with this AMZN Stock Perf Chart:

Discuss.

Edit 10/17: Kaiser sent me this picture which may show that riding the Segway produces a similar reaction in Bezos as staring down Anna Kournikova. If you notice, it’s quite possible that he is riding a segway in that shot. That is the beauty of the segway, you just never can tell.