Archive for October 2006

Write-Offs: 10.31.06

$$$Trump: You thought he wouldn’t have anything to say about Madonna and her Malawian baby. You thought wrong. [Trump Blog]
$$$Shake-up at Fortune [Valleywag]
$$$British banker and erstwhile DJ with joie de vivre seeks lady friend for “laughs smiles…adventures…spontaneous tickles and hugs.” [Craigslist]
$$$Last minute Halloween options [Forbes]

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Planespotting: John Thain, Least Shady By Default

NYSE: Westchester Co to Berumuda Int’l on its Gulfstream IV
(Wal-Mart Spawn) Jim Walton: Lethbridge to Grande Prairie (Alberta) on his Cessna Skylane
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Donald Trump: Pease Int’l Tradeport to La Guardia on his Boeing 727-100
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David Becker: Port Isabel Cameron Co to Austin Bergstrom Int’l on his Mooney M-20
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[We’ve got our hands full with Wall Street Warriors, episodes 3-6, so you’re going to have to fend for yourselves today, salacious and mud-slinging conspiracy theory-wise. Be good and we promise to give Becker the full planespotting treatment on Thursday. Be bad and we’ll make sure your dreams are haunted by this guy.]

The Highly Exagerated Death of Newspapers

newspaperboy.jpgWe’ve been reading about the death of newspapers for years, and the declining circulation numbers recently released have prompted a whole new round of pre-mortem elegies for ink and dead tree dailies. But there’s something odd about the whole “death of print” thing. For one thing—if the papers are really in so much trouble—why is private equity so hot after them?
The answer is probably that private equity understands that a lot of thinking at newspapers is hopelessly outdated. The New York Times has done a great job with their website but most of the real innovation was done by outside consultants. The consultants made the site work better. It was the Times folks who thought “Times Select” was a good idea.
The fact is that people who have built there lives and livelihoods thinking in terms of “ink by the barrel and paper by the ton,” newstand sales and subscriber numbers might not be very good about thinking in terms of digital content delivery. We’ve met more than one newspaper editor who, quite frankly, just didn’t get the web. In their hearts, a lot of these people think people are reading less newspapers because, well, they’ve become too dumb or lazy to read long, well-reported pieces. But there are plenty of people who do get the web, and we wouldn’t be surprised if a few of these old-school newspaper companies get snapped up by private equity and end up blazing a path into better digital delivery.
Newspaper Circulation Falls Sharply [New York Times]

That’s the gist of today’s Wall Street Journal editorial discussing the pressure coming for tighter regulations on hedge funds from, well, just about anywhere you look. There’s Senator Charles Grassley’s letter to regulators looking for suggestions on how to regulate hedge funds. (Our bet is that they’ll somehow come up with a couple!) And Connecticut’s Attorney General Richard Blumenthal’s mini-Spitzerism. And the noise from Germany about putting global regulations in place. (Look for more of this if Barney Frank gets control of the House Finance Committee.)
You see, a regulated industry is an industry whose players need to make campaign donations in order to influence lawmakers. It’s a pretty simple formula: regulate an industry and you instantly politicize it. Which is another way of saying that you monetize the industry for politicians.
But it’s not all about wringing donations from hedge fund managers. There’s also corporate managers who are tired of getting those pesky shareholder letters from hedge fund types, and worried they could lose their jobs as hedge funds buy up their shares. And those folks have lots of money to spend on campaign donations, as well. It’s a win-win if you’re a politician.
All the other talk—about “systemic risk” or pension funds or low-liquidity real estate millionaires—is just the sound of a policy in search of a rationale. And that policy, of course, is the enrichment of politicians. That’s always the policy.
Targeting Hedge Funds [Wall Street Journal]

The Stripper Question

demi_moore1.jpgSome comments and emails to our Zwirn item below have prompted us to ask the time honored question: are strippers a reimbursable client expense? So have at it below and let us know.

Are Strippers Reimbursable?
Yes. Who spends their own money on strippers?
Yes. But only if you’re in the club at the client’s request.
Yes. But you’ve got to call it something else.
Maybe. I’ve heard people do it but never tried it myself.
Strippers? Really? Who needs strippers when you can get any girl on Ludlow street to derobe for the price of two vodka tonics and a trip to the john?
No. Not only not reimbursable but not allowed with clients even on your own dime.
No. Girls work the expense department and they hate strippers.
No. The practice excludes women and has or should be banned.
How do you get a receipt from a stripper?
The less we talk about this, the better off we all are. Sometimes explicit rules are counterproductive.
Free polls from

  • 31 Oct 2006 at 2:24 PM
  • Halloween

The Horrors of Halloween

sexycop.jpgHalloween may be the world’s worst holiday. First of all, if people are encouraged to wear costumes where you work, you know that cute girl from recruiting—the one with the still discernable Long Island accent—came in as a “sexy” something or other. Just keep your distance today and remember that sexual harassment laws apply even if she is dressed like a Hooker Cop.
Second, if you’ve got kids, you’re spending the evening trailing them around as they pick up the most loathsome candies imaginable. And then you’re going to spend the rest of the week trying to talk them down off the sugar high, and probably the rest of the year paying for the dental damage incurred.
Third, if you live south of Fourteenth Street in Manhattan, you’ve got that parade to deal with. Which means you won’t be able to get home without combating about ten thousand people who think cross-dressing is an original and daring achievement.
Finally, there are no good Wall Street themed costumes this year. Discernable visages such as Ivan Boesky and Michael Milken are dated. How do you dress like Amaranth or Backdating? Isn’t natural gas invisible?
We guess you could do “A.J.” or “Lucy Gao” or “Aleksey Vayner” but those folks lack a certain, uhm, visual presence required for a good costume. Who can tell the difference between an Aleksey Vayner costume and that douchebag who hated Ralph Macchio in the Karate Kid?
What’s the October 31st translation of “Bah-Humbug” anyway?

What the Business Mags Are Saying…

In Business Week:
$$$ Is there an entrepreneurial gene? A group of experts provides us with very few answers on a question that’s crossed all of our minds. [Is There a Gene for Business?]
$$$ A college degree can earn you up to $23,000 more per year than a high school diploma — climbing interest rates on student loans and cutbacks in financial aid could put that number in the negatives.
$$$ This ain’t is your grandpa’s MySpace: social-networking for baby boomers. [MySpace for Baby Boomers]
$$$ A clear recipe for peace: loans, multinational banks and the developing world [What the Nobel Prize Means for Microcredits]
In Forbes
$$$ Former CEO Andrew J. McKelvey may be using his own site to seek employment opportunities (funny) following his resignation from Monster Worldwide in the wake of far-reaching options scandal. [Options Monster Claims a New Victim]
$$$ A big week for Merck, who bought out Sirna Therapeutics for $1 billion AND won FDA approval for its diabetes pill Januvia [Merck’s $1 Billion Bet/Merck Starts Diabetes Race]
$$$ Also a big week for EMI, who will be losing publishing executive Martin Bandier AND licensing former actor Dean Martin’s name, image and likeness. [Music Boss Bails Early/EMI to License Dean Martin’s Name, Image]
In Fortune
$$$ When the well-fed can’t leave ‘good enough’ alone: the fairly ridiculous rage of America’s lower upper class. [Revolt of the Fairly Rich]
$$$ Steve Jobs says Negroponte’s international One Laptop Per Child initiative, “looks like a science project.” Negroponte’s response: “Your company backdates” [This PC Wants to Save the World]
$$$ Murdoch to repay the $50,000 per month bill he incurred News Corp after he (and the SEC) decided it’s a little inappropriate to make others pay your rent when you’re a billionaire; investors are unmoved by the findings.

  • 31 Oct 2006 at 1:24 PM
  • Wal-Mart

Lumps Of Coal For The Waltons This Christmas?

Things are not looking good for Wal-Mart, Forbes reports:

The discount giant announced over the weekend that its same-store sales for October grew by just 0.5%, the company’s most anemic monthly growth rate since 2000. At the same time, a government report shows that consumers kept a firm grip on their wallets in September, boosting spending by just 0.1%, the smallest increase in ten months.
With the all-important holiday shopping season around the corner, major retailers are poised for their usual joust over consumer dollars. The battle may be more intense than usual this year, with high gas prices and a general economic slowdown pointing to a deceleration from the rate of spending growth in 2005.
Wall Street, meanwhile, is doing its best to handicap the upcoming slugfest, presenting investors with their best and worst bets on department stores, electronics sellers and specialty stores.
Merrill Lynch is already predicting a lackluster season for big-box discounters Wal-Mart Stores (nyse: WMTnewspeople ) and Target (nyse: TGTnewspeople ), whose sheer size makes it difficult to drive year-over-year sales.

We’re not much ones for passing moral judgment—pots/kettles, glass houses/stones having nothing to do with our abstention—but perhaps the ‘Mart should think about Karma and her predilection for being a bitch the next time it decides to take away stools from older cashiers in order to encourage them to quit and requiring workers—including those with young children—to be on call 24 hours a day. (Then again, those old people/damn kids probably had it coming).
Wal-Mart’s Trailing The Pack [Forbes]