68 Comments

JVL, heard this week’s Secret Pod where you said you were kind enough to “work with people” who can’t afford a Bullwark sub. One of the reasons I subscribed is because I could and hoped my money helps others. Thank you for being so kind.

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1st FTX link was about the right mix o' broccoli to sweets. 2nd FTX link a little too much (and way too many bullet points, dumb bears like me need pictures or summaries)

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It isn't just internet businesses that take time to die. Back in the 1930s, the Great Atlantic and Pacific Tea Company was a family run vertically integrated business that had a humongous market share in groceries. At one point it had 16,000 stores. (By comparison, Walmart today has about 10,500 stores worldwide today.) There were calls for the government to break it up as it was able to engage in predatory pricing and it gave preference to its own store brands over outside brands.

A&P missed the growth of the suburbs and the trend towards larger supermarkets. It had a long slow decline. By the 1970s it was a minor player. By the 1990s it was limited to the northeastern US; by the 2000s to the New York City area where most grocery stores are small because of exhorbitant land prices. Despite decades of bad business decisions, it took until 2015 for A&P to finally die.

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Yahoo! - a company for which I'll always have a soft spot because it played such a major role in my early internet days - is still around thanks mainly to the Yahoo! Finance and Sports pages and apps.

It's Yahoo! in name only anyway. The "real" Yahoo! sold off all the websites and IP and now specializes in counting its AliBaba.com money.

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What people miss is that is that FTX lost 8 billion Tethers, not dollars. Its like saying you lost millions of dollars when your Monopoly money got thrown away. All of these numbers are reflecting the various online casino chips everyone was trading. The actual cash gets sucked out pretty quick. The rest us just a host of grifters using homemade casino chips to make their Exchanges look exciting enough that the Normies will hand them cash for tokens. You can always buy more tokens, trying to cash them out has ALWAYS been the crypto problem.

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What people miss is that is that FTX lost 8 billion Tethers, not dollars. Its like saying you lost millions of dollars when your Monopoly money got thrown away. All of these numbers are reflecting the various online casino chips everyone was trading. The actual cash gets sucked out pretty quick. The rest us just a host of grifters using homemade casino chips to make their Exchanges look exciting enough that the Normies will hand them cash for tokens. You can always buy more tokens, trying to cash them out has ALWAYS been the crypto problem.

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Dec 3, 2022·edited Dec 3, 2022

This is completely off-topic, but what I would love to have collapse is Nextdoor. In my town, Trumpets took it over, and a lot of the “neighborhood leads” are Trumpets, too, so I eventually left. Now where do I find a used bike for my granddaughter? 😂

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JVL - (Hope you're feeling better)

Per your cryptocurrency reveal:

Heard this Preet Bharara podcast yesterday. An interview with Aswath Damodaran, a Finance professor from NYU;

"Corporate Teenage Wasteland" [basically comparing companies to the human life cycle - baby, infant, teenagers, young adults, etc.]

https://cafe.com/stay-tuned/corporate-teenage-wasteland-with-aswath-damodaran

They do talk about crypto and human psychology in investing. Fascinating info.

Bottom line --- never invest in any "idea" in which the "salesperson/entrepreneur" can't fully explain in layman's terms the value added by the product or service.

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Well, I did leave Twitter. A lot of people I know left. It took about 20 minutes for people to start their “Anything goes cus Elon is in charge!” hate Tweets. If I want to read that garbage…but I don’t.

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Dec 3, 2022·edited Dec 3, 2022

I think that Twitter going bankrupt would be the best thing that could happen for both Twitter and its users.

As JVL pointed out, the site would probably still function even if the company failed. Ownership of the site, however, would pass from Elon to the boring, smart professionals at some distressed debt fund.

These people would run the exact same strategy that Elon is trying to implement (cut headcount and make people work harder) without the distractions caused by Elon's Cocaine Bear management style. This would result in a both a stronger business and a better product.

(What the fork is "Cocaine Bear?" Glad you asked: https://youtu.be/Q8JrYFf0swM)

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I agree that Twitter will be around in some form for years to come. The real question is how long will Musk be involved. He paid 3 or 4 times what Twitter was worth. As a result Twitter highly leveraged. Reportedly, the interest alone is a billion dollars a year. Twitter has never made much money and loses money most years.

This is occurring at the worst possible time for Musk. Tech stocks are down. Tesla's stock price is in free fall. Tesla has always served a niche market. Now that EVs are poised for a breakout, every car maker in the world is making them. That's a lot of competition for Tesla, which produces over priced cars of dubious safety and reliability. (I would never buy one)

Bankruptcy seems to be the most likely outcome for Twitter. It will be sold for pennies on the dollar.

P.S. Is Elon Musk still the richest man in the world? His wealth has taken a big hit in 2022.

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founding

RE: How Did FTX Make $8 Billion Disappear?

Maybe SBF cribbed a couple of pages out of EM's playbook? Maybe not. Apparently making mounds of $$ disappear isn't a specialized skill reserved for the less intelligent players. Even the geniuses can do it.

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I have mixed feelings on the Crypto crash. On the one hand it was so obviously a scam from the word go I am amazed that anyone could be dumb enough to put their money in it.

On the other hand scammers take in honest people all the time. Unfortunately, the biggest losers seem to be people of modest means who could least afford to lose their money.

Time tested advice is often right:

1 - Never invest in anything you do not understand.

2- If it sounds too good to be true....

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A little off topic, but in response to Tim's piece today - am I seeing things or do the R-est of the R's have a bit of a preoccupation with matters of sexuality? Trans, gay, abortion, grooming/groomers, Hunter's private parts. When they do their Impeach Biden, will they find it necessary to put up the pics Tim referenced, just in the interests of a thorough investigation, you know? I read where Indonesia (but might have the wrong country) has outlawed premarital sex. Maybe the R's will want to look more closely at this, on a state by state basis?

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A little more on why the average person that isn’t into the inside baseball of investing should be concerned with FTX. A better understanding of the impacts to the overall economy would be useful. A lot of the FTX reporting is lined up in jargon.

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