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Rambling thoughts on who knows what... Because not everything is as the conventional wisdom would have it... BLOGS I SORT OF LIKE... Volokh Conspiracy ProfessorBainbridge MarginalRevolution Patterico Powerline Ace Wizbang JustOneMinute XRLQ Betsy's Page HE WHO USED TO LINK ME EVERY NOW AND THEN InstaPundit Email Steve
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Thursday, April 29, 2004
I agree with Tyler Cowan that Google is likely to go down post-IPO...
Before I offer my reasons, let me put forth two stock market truisms: The first is the only reason to buy a stock today (other than for dividend yield or for emotional reasons) is the hope/expectation that someone else will be willing to pay more tomorrow (some would call this 'the bigger fool approach'). Thus, IPO buyers hope that post-IPO buyers bid up the price. These post-IPO buyers hope that post-post IPO buyers will in turn bid the price up even further, and so on and so on. Any time that the next group doesn't show up, or even the next time one suspects there won't be a next group, well, that's when the price no longer goes up, but at best stays level. The second truism is that investors need a reason to believe that future investors will come along - there needs to be a 'story' for the stock that will attract investors. There are all kinds of stories: some are 'objectively' driven (great fundamentals: EPS, 30 or 60 day trailing averages, price support points and the like), others are more subjective (this stock will revolutionize e-commerce). The particular story for a given stock doesn't matter so long as it exists and is deemed believable by enough investors. In Google's case, a $20+ billion valuation can't be supported by any of the traditional objective measurements. Brad Delong, while bullish, can't see it. Google investors thus need a subjective story. Unfortunately, I don't see the emotional, I mean subjective, story that will carry the day. Take for example, the 'getting in on the ground floor' play. Sure, for a start up, this play can get some traction. But Google is not a start up. You can't easily use the old 'once they figure things out' approach - they've been around, they already have 'professional' management, they're already profitable. You can't excuse away 'investment in infrastructure'; as Brad DeLong points out, they don't have any. You can't disregard heavy up-front advertising that is used to develop a customer base because Google doesn't have any. You can't extrapolate their revenue numbers, the way people used to do with Amazon (to project that in a mere five years that Google will pull in more revenue than half of the developing countries worldwide) because they're not growing at anything near an astronomical rate. Nor will investors buy Google because 'it's cool' - it's not cool, at least not to regular people. True, to geeks, Google's search logarithms are the coolest thing since the GUI, but to the rest of us, Google is just some search engine. While there are enough people who do think it's cool - and who won't be getting IPO allocations - to believe there will be an initial post-IPO bump, I don't see the masses thinking the same way. To me, Google is a function - a useful function, but a function nonetheless. I don't get excited about functions, and I doubt that many investors will either. Nor will investors buy Google as a proxy for the 'internet revolution'. Five years ago, people bought up almost every dot-com stock there was. The view then was that there were a new dynamic at play and it was financial suicide to sit on the sidelines - so people bought dot-coms they didn't know anything about just to be in the game. That won't happen with Google - they don't represent any new dynamic in the marketplace. Nobody will be making claims about how Google will make obsolete 'bricks and mortar'. Nobody will claim that Google will change the way we go about our day, or change the way we work. As I said, right now, it's a search function that sells advertising - it's not a 'I don't know what they do, but I've got to own it' type of stock. So lacking a story, there won't be any light to draw in the post-post-IPO bugs, I mean buyers. Without these buyers, the stock won't go up. And, when the stock doesn't go up, the post-IPO buyers will look to dump their shares - right past the IPO price. * Note: I would short the shares, but, for marriage reasons, I can't... If any readers do, and make money, you're welcome. Wednesday, April 28, 2004
A follow up to David Adesnik's comments on Wesley Clark's comments about Kerry. It's not surprising that Clark would come to Kerry's defense, since they are both trying to do the same thing: use their service in the military as a shield against criticism of actions and positions they have taken and statements they have made after they got out.
Tuesday, April 27, 2004
This is what I was talking about, a body count of the enemy. Mark my word, most Americans will feel reassured that US troops were able to take out a relatively large number of the enemy, at what appears to be no US casualties.
Is Kerry just stupid, or does he think the rest of us are?
Kerry gets attacked, not for what he did while in the military, but for his actions afterwards. He responds by attacking those who are 'attacking my military record' (not an exact quote but you get the point), even though no one is doing that. So, is it that he is incapable of distinguishing between the two, or does he think that we are?
I'm often puzzled by the so-called conventional wisdom, this time the thought that should the US attack Najaf, it would lead to a widespread Shiite uprising...
I'd suggest a different outcome, that should the US use overwhelming force and destroy Sadr and his forces, that the Shiites would be as likely to rise up against the US as they were to rise up against Hussein - not likely at all. Another piece of CW that I don't understand is the feeling that US troops are being attacked in order to get us to leave Iraq. Yet, except for wackos like Nader, the consensus is that our resolve to last things out is strengthened by these attacks. Wouldn't it be much smarter for the insurgents to go quiet, to hole up, letting us think all is well and hastening our departure - then emerging to battle for control? Perhaps the insurgents are not so smart, perhaps there's a different reason for their attacks... Friday, April 23, 2004
Talk about a way of alienating 30% of the public...
As I understand things, SUV sales amount to as much as 30% of all car sales in America. Most drivers of SUVs are, if not proud of their car, at least apt to get p***ed off at those who take cheap shots at their choice of transportation. So along comes Kerry, with his seeming disavowal of the 'family's SUV'. Senator, what's the message for us SUV owners, "I'm ashamed I'm like you". Or is it "I don't want to be like you"?
Sounds like they're a bunch of Democrats, the way they're complaining about the voting on American Idol...
Just as the Democrats in 2000 couldn't accept that Bush won the election, these complainers can't accept that - according to the rules of the show - one of their favorites lost. And just as the Democrats were quick to throw out all kinds of unsubstantiated and unprovable allegations, here too these complainers are inventing reasons for the results: racism, lack of talent appreciation on the part of the American public, and so on. What's next, Simon wearing a 'Don't blame me, I didn't vote for John' T-shirt?
I'm so confused, Senator Kerry, is bribery good or is it bad?
Last year, you railed against Bush's coalition of the bribed, ...the bought...". Yet, just this week, on Meet the Press, you said "I would have worked with the United Nations" - but aren't they "the bribed"? Please explain, I'm getting a headache trying to figure out your position. Maybe it's that you object to the US bribing countries, but not when it's Hussein doing the bribing? Or, maybe it's not the bribes per se, that you object to, but rather the countries Bush was 'bribing'? Were you just trying to say that bribes are fine, it's just that Poland, Spain, Honduras, Australia and the like should not having been getting bribes, that they were 'not worthy'? Could this account for your answer “we should share”, when Russert asked you about the French, the Germans, and the Russians wanting to " have some of those oil profits"? I need a couple aspirin... Sunday, April 18, 2004
Bring back the enemy body count reports...
It sounds crass, but every time an American soldier dies in combat, we at home want to know that he, his comrades and those of us at home - got something in return. While each combat death is sad, it's the ones that don't mean anything that hurt the most. If our troops are going to suffer casualties, let's make sure it comes at a high cost to the enemy. Now, putting in place a real democratic government and free society in Iraq would certainly p*** off our enemy - it is, after all, one of the things they are fighting to prevent. Yet, since we can't reasonably gauge how much closer we're getting to accomplishing our political goals in Iraq on a day to day or a battle to battle basis, we need another standard to evaluate progress. The simplest way of doing this is to count how many of the enemy - whether it be uniformed, irregular, guerilla or terrorist - are being killed by our troops. The more of the enemy that are being killed, the better. As for how many enemy deaths, I want at least 10 enemy killed - preferably more, much more - for each American casualty. What we don't want to hear at home is of a US death, or a couple of deaths, or more deaths, without some way of determining the other side of the equation. Without hearing an enemy body count, all we know is that US soldiers died - we don't know if they took anybody with them or they took 100 for every one of us. And, it does matter. In Somalia, all we heard was of the 18 Ranger deaths. By itself, with no context, it sounded terrible. But, after watching the movie, and seeing that the Rangers took out somewhere between 500 and 1000 of the enemy, it didn't sound as bad. Contrary to my vacuum impressions, our deaths in Somalia weren't totally the result of screw ups and the occasional lucky shot. Our guys were facing a angry and armed swarm and acquitted themselves damn well. Had Clinton not panicked and pulled our troops out, their grandstanding over our dead soldiers notwithstanding, I wonder how eager the Somalis would have been to take on our soldiers again. Sure there are a lot of Somalis, but at a 20-to-1 ratio, those numbers would be going down real fast (and, as the experienced Somali fighters were killed and replaced with less experienced fighters, their numbers would be expected to drop even faster). The same thing happened with the Tet Offensive. I wonder how many people would have had a different impression had the vast numbers of Viet Cong deaths been accurately announced (I know body count numbers were notoriously inaccurate back then). Would our thinking have been more along the line of General Giap's, that the Viet Cong and the NVA were shot up pretty bad and a renewed push by the US and the ARVN forces might have changed the outcome of the war? In Iraq, all we know is that April was bloody for US troops. We don't know if we made any progress towards our political goals. So, Secretary Rumsfeld and General Abizaid, tell us how our troops did on the battlefield. Did our guys take a whole bunch of the enemy with them? Or not? Thursday, April 15, 2004
Some thoughts on "The Apprentice"...
While fun TV, I find it interesting that NOT ONE of the tests actually tested the skill sets required of a CEO. Selling lemonade and bottled water, cleaning up and renting out an apartment, running a promotion to pump up gambling volume or merchandise sales at a restaurant, renting out an apartment for a night - these are all things a CEO hires people to do for him or her. Even the final two tests, running a golf tournament and babysitting a pop star - well, they'd be good if you were looking to hire an event planner or a chaperone, but a CEO? No way. Designing an advertising campaign touched on aspects of what a CEO needs to bring to the table - knowledge of the market, of the niche he hopes his company can fill - but most of what they did - taking pictures, working the computer, well, that is again what a CEO hires other people to do for them. Even the inter-personal dynamics of the show aren't representative of what a CEO deals with. A CEO gets to pick his own team and doesn't have to suffer with fools picked by someone else - so what good is it to evaluate a candidate by how well they deal with their fellow contestants? And, what kind of a successful company has employees who worry about making their boss look too good, for fear of losing the beauty pageant? A good CEO will have staff who compete among themselves, but not with the CEO himself. And, while good CEOs may be 'team players', and not autocratic fire-breathers, in real life, everybody on the team knows who signs - or won't sign - their next paycheck. As a result, you don't have people going off on their own, marching to their own beat, disregarding their orders. So what does a CEO do? They design and put into place plans for maximizing profit by taking advantage of one's competitive advantages, of exploiting gaps in the marketplace. They think about what the future holds and the best way to position one's company to take advantage of that. They allocate scarce resources among competing factions. They monitor performance of the various operating units, using metrics that are relevant to the particular business. They get the staff excited about the company's prospects. They constantly look to improve performance over the long term. And the last point illustrates the biggest difference between a CEO in real life and Trump's applicants. Trump measured success based on a single event, usually conducted over a very short time frame (hours and days). The measure of success of a real CEO is over months and years. Hard to do in a TV show...
David Adesnik, atOxBlog, offers up some thoughts on the Israeli-Palestinian events of yesterday. While I agree with David on many points (can't help it, he's a smart guy), I'd like to offer up another take on what David says is "Bush... damaging the peace process by publicly endorsing -- for the first time ever -- the most unreasonable of Israeli demands". Maybe what Bush has just done is shift the peace process to another track, one with a higher chance of success.
For the past several years, the Palestinian's version of the peace process has been to use terror, bring worldwide pressure on Israel, and refuse to enter into any real compromise with Israel, feeling that Israel would eventually buckle under the pressure. And, their strategy was working, as aside from some isolated assassinations and some periodic sweeps into Palestinian-controlled areas, Israel really didn't do anything to shift the dynamic - nothing to show the Palestinians that their tactics were actually costing them, rather than producing gains. Perhaps now they have. What Bush endorsed yesterday represents a worse deal for the Palestinians than was offered to them at Camp David. They're no longer starting with the entire West Bank, with designs on parts of Israel proper. For the first time, the Palestinians have been shown evidence that their tactics have resulted in them losing ground. For the Palestinian in the street, or maybe more accurately, the Palestinian who used to live on what will now be the Israeli side of the barrier, many of them may start to question the wisdom of their 'leadership'. So what happens next? As much as we'd like to see an immediate rush for the negotiating table, I'd guess, given the Palestinian leadership's philosophical and emotional inability to ever accept Israel's existence and their unwillingness to admit they were wrong, they'll result to another wave of terror attacks, blaming Bush and Sharon, and hoping that this will cause Sharon and Bush (actually the State Department) to lose their nerve and backtrack (Bush ought to be telling Powell to keep his mouth shut). Maybe we'll see another Al Queda attack, with claims that this was in response to Bush's position, in the hopes that American public opinion could be swayed. And, of course, the Bush haters will use any such attack to blame Bush. Provided that Bush and Sharon stay resolute in the face of these potential attacks, the Palestinians may finally come around to the idea that there's more to be gained by settling now than by continuing the conflict. And, if they don't, Sharon ought to be thinking about what should be Round Two... Monday, April 12, 2004
Why is there a ceasefire in Fallujah? If the 'insurgents' haven't surrendered, why aren't the Marines killing them off? Are we supposed to believe that these terrorists have seen the error of their ways and now only wish for an opportunity to live in peace with their neighbors?
We are at war. As Patton said (I believe) the goal of war is to kill the enemy. A ceasefire does nothing of the sort. The opposition will use the time to regroup and rearm. It will be seen as a sign of weakness, that the US doesn't have the b***s to finish things off. The terrorists and thugs will turn this into the 'victory of all victories'. Until this war is over - and that is when the enemy ceases to exist - the battle must continue. Kill them. Kill them all. Kill them all now. We didn't do so a year ago and now we have more casualties. If we don't do it now, there will be more casualties later.
Jim Robbins on NRO shies away from endorsing what I will call the 'whatever it takes' approach to dealing with terrorists and other enemies. I disagree with Jim, as doing so will hurt us in both the short and the long term...
As I wrote long ago, the ONLY goal of our military and foreign policy should be to protect Americans and American interests. That's why we elect our leaders - to protect us. Everybody else and everything else is secondary - we don't elect our leaders to look out for, for example, the interests of the Iraqis. Given that, the ONLY decision for our leaders should be how to PROTECT US IN THE MOST EFFICIENT MANNER. In this case, efficiency is first defined as the smallest number of US casualties. We only care about collateral damage when there are NO negative consequences to Americans of doing so. Sometimes, protecting Americans will require doing things to other people that aren't considered 'nice'. Like embarrassing them, killing them, making them homeless, destroying their country - all is fair when it comes to protecting Americans. Yet, rather than pre-emptively knock down Muslim shrines that could be used as sniper posts, we expose our troops to danger. Rather than clear free-fire zones around the highways, and destroying anything that comes within RPG range of a convoy, we take casualties. How can President Bush and our military leaders justify this as policy? It's bad enough to have to tell a parent that their son was killed in action - but to do so because they wanted to spare Iraqi buildings? It's incomprehensible! Our soldiers should only die to protect Americans - not buildings, and certainly not Iraqi buildings. And, our leaders tell our troops to wait until they're shot at before they can return fire. This sure doesn't sound like the Bush doctrine of pre-emptive action, does it? Aren't we no longer supposed to wait until we've seen the 'smoking gun'? If the doctrine is good enough to justify invading Iraq, it should be good enough to let our troops shoot on the suspicion that they are in danger. How can Bush justify telling an American mother and father that their son died because we were more concerned about Iraqi civilian deaths than allowing our troops to protect themselves? In Fallujah, we've given women and children a chance to leave. OK. But, rather than just level the town and kill everybody is left, we're going to send in the Marines for street to street fighting. While this might save some 'innocent' Iraqis from harm, how many Marines will die as a result? While on one hand, I'd like to fight fair, that is almost always a slower and more expensive way to end hostilities than fighting dirty. And, unlike others (I'm not including Jim) who are sitting safe at home, I try to imagine how I would act in a war zone. For me, assuming I wasn't too scared to get out of my shelter, if the choice came down to killing Iraqi civilians, of butchering their remains, smashing their homes, nuking their entire country - or the lives of my fellow Americans - well, there's no choice at all. Because, as I also wrote long ago, Iraqi lives, whether civilian, military, thug, whomever - just aren't worth as much as American lives. Better 10, 50, 100 Iraqis die than one American. You see, it all comes down to what and who you consider important. As it is sung, "and nothing else matters". UPDATE: Mark Steyn makes pretty much the same point, saying that "The avoidance of teacup-rattling remains a priority.... the problem with this deference to the locals is that, partly in consequence, most of the folks who are getting rattled are on our side".
For all the supposed brainpower in the White House, I suggest there's a lack of chess players. How else can one explain the poor job we're doing in anticipating and planning for the response of others to actions we take?
We put Iran on the 'axis of evil'. We move into Iraq, proclaiming that this will lead to a sea change in the Middle East, leading down the road, for example, to democracy in Iran as the people dumped the Mullahs. Yet, it never seemed to occur to anyone that the Mullahs might not sit on their rear ends, but would instead fight back. Which they have, crushing dissent in Iran and supporting the uprising and upheaval in Iraq, all with seeming immunity. Up to now, we always declined to get rid of al-Sadr. We didn't want to be too aggressive. We wanted to let the Iraqis take care of things themselves. We wanted to focus on other areas, such as bringing water, power and schools to the Iraqis. Yet, we don't seem to appreciate that no matter the reason, our inaction would have been perceived as a sign of weakness. How many others are there like al-Sadr? In the fighting, we've take care to shield 'civilians' from harm. On one hand, it's admirable, yet it's taken as another sign of weakness. As a result, the terrorists and thugs use civilians as shields, increasing both our and the civilian casualty rates. The press, even those who should know better, portray it as weakness on our part. Thursday, April 08, 2004
Am I missing something, with the judge in the Lea Fastow case screwing up the plea agreement? The prosecutors and the defense team agreed on a prison term for her, as part of a plea agreement with her husband, that will require him to cooperate with the prosecutors, and the judge goes and throws a wrench into the whole thing - all because he wants her to serve an additional 5 months in prison? Talk about activist judges! Whether she serves 5 months or 10 months IS NOT A BIG DEAL! Heck, in order to get her husband to plead guilty and offer up evidence against Skilling and Lay, I would have been willing to see her get probation! Five months in prison? Icing on the cake. Accepting the plea deal is NOT a miscarriage of justice, nor does it signify the judge's acceptance of any abuse of prosecutorial discretion - because there isn't any! When the deal was announced months ago, there was no public outcry, nor were any Congressmen calling for an investigation of the prosecutors. Even without the tie-in to her husband's plea agreement, the 5 month difference is insignificant and the judge ought to get smacked upside his head (administratively, that is) for sticking his head into where it wasn't needed. To require us to bear the costs of a trial in the hope of getting another five months in jail out of the lady shows a total lack of perspective. To jeopardize Andrew Fastow's cooperation over this five month issue is even more ridiculous and the judge, in my opinion, just qualified himself for the 'Stupid Jurist of the Year' award.
Wednesday, April 07, 2004
Tuesday, April 06, 2004
Darn those Canadians. If only they had stayed out of Iraq, then this wouldn't have happened. Wait a minute, they aren't in Iraq...
Monday, April 05, 2004
Americans aren't really any different from the rest of the world when it comes to forgetting the past. Remembering the slights of the past is the national pastime for losers. The Muslims are mad about losing Spain in 1492 because they lost. Hussein loyalists in Iraq? They're still fighting, but not because they think Hussein or his sons are coming back to power, but because they lost. Hitler? Motivated by losing. The Palestinians? Motivated by losing. The same thing with the IRA and Old Stalinists - motivated by losing, every last one of them. 'Old Europe'? Driven by generations upon generations of collective losing. I'm no history major, but look around and where you find a group obsessed with remembering something in their past, I dare say you'll find someone who was on the losing end of some conflict.
Americans are not immune from this - when we've lost a fight, or been losing, we're as capable of obsessing on the past and harboring grudges as anyone else in the world. Vietnam vets? Upset because we lost. The US Ryder Cup team - obsessed with redeeming themselves. The Old South - p***ed off because they lost the Civil War. On the other hand, you won't find as much handwringing in the north over the Civil War because, as winners, they've moved on. Texans remembering the Alamo? A great rallying cry, but nothing special after they defeated Santa Ana. Remember the Maine? Not any more, because we won the war with Spain. The same thing with Pearl Harbor. Winning gives us the luxury of moving on, of looking ahead. That is why 9/11 still resonates with so many Americans, and could help to explain how others have 'moved on'. For those of us who felt they lost something on that day, we haven't yet won the fight against Islamic terror - we're still net losers in the war on terror and thus we're very, very motivated by what happened. For us, 9/11 is as powerful a motivator as the Alamo, the Maine or Pearl Harbor were to earlier generations. On the other hand, I'd venture a guess that those who have moved on since 9/11 are those who weren't all that upset in the first place.
This is amazing. Not the computer glitch at WalMart but rather that WalMart processed 800,000 VISA/Mastercard transactions on one (non-Christmas season, one non-weekend) day. Add to this the number of transactions in which people used another credit card (Amex, Discover) or paid in cash or paid with a check and we could be looking at perhaps a couple of million transactions. Figure for each transaction there was likely more than one person involved - a couple of kids, a spouse - perhaps somewhere in the ballpark of 2.5 shoppers per transaction. This works out to perhaps as many as 5 million people having bought something at WalMart that one day. And, since not every WalMart shopper shops there every day - figure perhaps one trip per shopper per every two weeks? - we're looking at as many as 130,000 million people shopping at WalMart every year.
I knew WalMart was big, but this big? Wow. Given these numbers, what kind of traction do you think the 'WalMart as evil' plank will have on the campaign trail? Now that I think about it, there are so many WalMart shoppers that, as a voting bloc, they dwarf soccer moms, the Bush lied angry left, gun nuts, - all put together (with some overlap). I wonder how long before they get paid attention to, before they get singled out in campaign messages?
Again, Kerry demonstrates that his inepitude at PR can rival that of the GOP, with his complaint that Bush is a big spender...
Rule one is make sure you are speaking to people who are open to your message. So just who is Kerry trying to impress with this line, conservative Republicans angry at Bush's spending? Does Kerry think he could ever, ever, ever get their vote? Nor can I imagine that Kerry is looking to lock up his liberal base, certainly not with complaints about unfunded spending (would he be the pot or the kettle?). Who's he targeting: soccer moms, Home Depot dads? Seniors? MTV? I don't see the group that could be expected to rally around Kerry's message. For as I've written before, most voters don't care about government spending in the abstract. They don't care about the overall level of government spending ($2 trillion, $2.3 trillion, what's the difference, who cares?). Voters care about specific programs, either because they love that program or because they hate that particular program. But Kerry isn't going after specific programs, he isn't even going after the overall level of spending. He's going after the fact that much of the spending is being deficit financed. But voters don't care the deficit, which is itself an abstract. With so many people not caring about running up their own credit card balances, why would Kerry expect them to care about the federal credit card?. Even worse for Kerry than picking an issue that nobody really cares about, is that in complaining about Bush's unfunded spending, he is only reminding everybody that he wants to raise their taxes - not exactly a great thing to do around tax time. As I've said before, not exactly a smart play. So tell me, just how is Kerry trying to score points here? Friday, April 02, 2004
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