Be a Billionaire like Bill

Forbes Magazine’s current billionaires issue contains possibly the least surprising opening pull-quote of all time: 

I want to meet the people for whom the statement “[Forbes readers] overwhelming want to be billionaires”  comes as news. Strike that. Better yet, I’d like to meet people surprised by the idea that most people anywhere would happily be billionaires.

Conrad Black, Non-Competes, & Snowmobiles

Yesterday’s Delaware court decision against Conrad Black came with a comment from the judge in the Hollinger case that he found Black’s testimony “evasive and unreliable”. What was he talking about?

Consider the following snippet. In it we have Martin Flumenbaum, a lawyer for Hollinger International, asking why Black received a $7.2 million non-compete payment. Recall that Black later signed statements saying that the payments were made to satisfy buyers of Hollinger assets.

Flumenbaum: “So to the extent that you approved and signed a document in 2002 which said that you signed a non-competition agreement with the purchaser with respect to the moneys you received in February 2001, that was false?”

Black replied: “I’m not sure.”

Flumenbaum: “You don’t know whether it was true or false?”

Black: “I’m not sure.”

Flumenbaum: “Would it help if I showed you the document you signed?”

Black: “Might do.”

Flumenbaum: “I showed it to you at your deposition.”

It reminds me of the conversations I had with my parents as a teenager after I crashed our snowmobile. “Were you going too fast? I’m not sure.” “You don’t know whether you were going too fast? I’m not sure.”

What Has Gotten into Lou Dobbs?

Apparently Lou Dobbs has crossed some sort of virtual Rubicon on this offshoring issue, and he can’t stop himself any more. The Dobbs Watch ™ reached the pages of the Wall Street Journal this morning, with it highlighting the incongruity of this former fan of free trade now pumping for something called “mutually benefical” trade, which sounds like a euphemism for subsidies and tariffs.

Anyway, you can read the WSJ story, or for even more fun read the full transcript of Dobbs’s spark-filled debate with Washington Post columnist Jim Glassman:

DOBBS: Well, my next guest takes a decidedly different view. James Glassman wrote an article this week that begins by asking, “What Has Gotten Into Lou Dobbs?” In it, he takes issue with our extensive reporting here on “Exporting America,” our conclusions and positions.

Glassman says our list of companies sending American jobs overseas, which we update here every night and post on our Web site, include some of America’s most innovative companies. James Glassman is a resident fellow with the American Enterprise Institute and joins me here in New York.

Jim, that was quite a little article.


DOBBS: OK, let’s start with the accuracy.

The fact is that we are seeing hundreds of thousands of jobs being outsourced on the basis purely of a corporation’s interest in achieving the lowest possible price for labor. Does that make sense to you?

GLASSMAN: Lou, that is called trade.

And we have been doing it for hundreds of years.


GLASSMAN: You majored in economics at Harvard. You understand that Adam Smith, David Ricardo showed that trade is good for both parties.

The Trouble with Polls

Whether you’re doing market research or trying to figure out likely political winners, polls matter. An article in the journal Nature today has some interesting comments on the subject:

  • By one estimate, only 35% of people reached by phone during the 2000 campaign answered pollsters’ questions, compared with 65% in 1985.
  • The margin of error you hear about is an illusion. All it really guarantees is that the people sampled were statistically representative of the larger population. There are many other sources of possible distortions.
  • One study found that it makes a difference whether the question “Who will you vote for?” comes at the beginning or end of an interview. The percentage of undecided voters dropped sharply when it came last.

Martha, Apple & the Ink Experts

Life — or at least the Martha Stewart trial — is imitating a typographic CSI. There have been duelling prosecution and defense ink experts on the stand, both trying to prove whether Ms. Stewart’s broker wrote the “@60” mark (i.e., a pre-agreement to sell ImClone at $60) on Martha’ statement:

The top ink analyst at the U.S. Secret Service testified last week that all the ink markings on the worksheet came from one or several Paper Mate pens, except the “@60” mark, which was an different ink.

Bacanovic attorney Richard Strassberg presented an alternative ink expert Monday, who testified that a small dash near the listing for Apple Computer matched the “@60” notation.

For some reason I’m just fascinated to hear that the U.S. Secret Service has a “top ink analyst”. What does it say on their business cards?

Jobs, Jobs, Jobs!

Gerald Baker of the FT has a savvy piece today summarizing why trade is not bad for U.S. jobs. Along the way, he has the following graph which I think really underlies people’s uneasiness with the current economy — the employment aspect of the current recovery is far and away the weakest of the post-War period:

The Economics of Selling Stocks

The current Buttonwood column in the Economist has a nice quote about the changed economics of trading stocks. I’m doing a talk about this subject on Friday here at UC San Diego, so the quote from Charles Biderman of Trim Tabs caught my eye:

“If you’re paid 4% to 7% to sell new shares and one-tenth of 1% for trading them, what do you think you would want to sell?”

Google Searches for Sarbanes-Oxley

The Google IPO march continues apace. I see that as of today the company is looking for a Sarbanes-Oxley compliance officer. Not much point in having one of those folks skulking about unless you’re serious about going public sometime (relatively) soon.

Google IPO PR & Jeff Skoll’s Jokes

The puffy profile piece on Google’s upcoming IPO that is the cover of the current Wired has an entirely appropriate URL. It is Notice, of course, the trailing “pr”, as in “printable version”, but also as in “public relations”.

To be fair, the piece does have some good tidbits about life in a soon-to-be-public company. Here, for example, is a quote from Jeff Skoll, eBay’s first employee and former president:

“Before we went public, I used to send out a company-wide joke each day, just as a way of loosening things up. The day after the IPO, I sat down at my computer to write that day’s joke and in walked the general counsel. He says to me, ‘You know that joke of the day thing? I think it’s very funny.’ Gosh, thank you, I replied. ‘Well, stop it,’ he said. ‘We are a public company now, and we don’t want to offend anyone. If you want to keep sending out jokes, they can only be about lawyers.’ So I tried sending out lawyer jokes for two weeks – and then I gave up.”

What’s Next for Nasdaq?

So what’s next for Nasdaq? The history of the index is that long-ish declines create considerable pent-up pressure for reversion. In other words, technology traders are impatient folks and they can’t seemingly resist “buying the dip”.

Let’s leave aside whether that makes any sense (it doesn’t), it is interesting looking back at the last time the Nasdaq Composite declined for more than five consecutive weeks. It was October 2002, and here is what happened:

A fair rejoinder, of course, is that the 20% snap-back rally in October of 2002 was very different from today. Back then stocks had been weak for more than a year, and there was a great deal of fear and consternation in the market. The power of the snap-back was partly a function of the length of the decline, but it also arguably had at least as much to do with the severity of the decline.

Put another way, you’re more likely to see a snap-back rally after three weeks of 5% declines than are are after three weeks of 0.05% declines.