Gambling at it’s core is purchasing a chance where you may or may not know the odds, but there are set odds for every given circumstance.  The odds of your winning at the Bellagio in blackjack are set, and if you play 1,000 hands, those odds will bear out over time.

If you look at one single tradeable item in the stock market, it’s easy to determine why and how the individual price movements occurred.  If you had perfect knowledge, you could easily predict the direction that price would move.  In blackjack, this cannot occur.  The best player in the world has no statistical advantage over the second best player or even the 5,000 th best player. The rules are so simple and the options so limited.  This is the same with games you play the house.  Even the best players will hardly outperform each other.

Now look at poker.  Poker isn’t really gambling. It’s a contest much like football.  The difference between the best player and the 5,000th best player is hugely significant.  Why?  The game becomes far more complex, and skill and choice matters.  If you bankroll the better player, you’ll come out ahead most of the time.

The stock market is representative of the companies that are competing in a very complex game.  The stock values for any given company is representative of our belief of how skilled and how likely those companies are to “win” their poker matches.  Can investing be gambling?  Sure.  If you gave $100 to each person on the casino floor to play with and hoped one would hit the jackpot, that would be gambling.  It would also be gambling if you gave one person $1K and hoped they would hit the jackpot.

But if your money was backing the house?  That’s not gambling, that is investing.  Your money is backing the best player each and every time.   For people who throw their money around, the stock market is a pure gamble.  For those who invest over the long term with the house?  That’s investing.

Oil trades at $50 today. If i asked 1,000 people if oil is likely to hit $100 again in the next 5 years, I bet 95% will tell me it will. I’d also guess they will be right. I also bet that 95% of them aren’t buying oil right now even knowing a 100% gain in 5 years would crush their other investments.

Why won’t they invest in a likely outcome? Well, its a whole lot more fun to stay at the casino and gamble than run the casino. If you want to stay at the Casino and gamble, than gamble away, just don’t look at us Casino Owners and think we are playing the same game

To help further illustrat Circuit City flushing itself down the toilet, here is an excellent timeline provided by the great folks at Consumerist, the best blog on the planet for consumer activism.

Circuit City did the unforgiveable.   They are in a the service industry.  Their product line does not differentiate itself from their competitors in any significant manner.  That means any added value must be gained form the service that the stores render to the customer.  The fuck ‘tards who were in charge of CC have the highest amount of arrogance.  They think their leadership adds value, and they can get any $8/hour scrub to succeed because their leadership is what matters.

The market always punishes such arrogance.   Their operating officers thought they were in the electronics business, when in fact they were in the service business.  They took their single most imporant assett and flushed it down the toilet.  Good riddance. Anyone who was still at Circuit City after the cuts one year ago was asleep at the wheel.  This company had horrible leadership and was doomed.   When you have screw ups like Philip Schoonover running the show first get rid of the stock.   If you work for that company, it is time to jump ship.

Find the companies making gross errors and short them all the way down.  You can no longer count on companies to hire CEO’s that have a clue how to run a business.  Schoonover had a deal for $6-$8 a share. amd Circuit City piddled around until Blockbuster got cold feet.   A big “Fuck You” to Philip Schoonoveris deserved, but understand he isn’t the only one.

It would be sad if it weren’t so funny.  In an earlier post, I outlined that Yahoo’s deal with Google was a huge strategic fuck up.  Now that Google has backed out of the deal that Yahoo! so desperately needed, Yahoo! is headed for disaster.

Yang has sold the deal as the salvation of Yahoo.  Everyone with a functioning brain knew that Yahoo! desperately needed the deal and Google was only doing it to piss off Microsoft, but was far from necessary.  Had the deal passed, Google would have slowly been a more and more important source of revenue. Once they knew Yahoo! couldn’t live without them, they’d pull the rug out from under them.  It’s the harsh strategy of bringing somoene under your protection and then weakening them until they can no longer defend themselves. Then you throw them to the wolves.

$33 was the price.  The stock is now worth $14/share.  $33 was more than a fair premium for a company that had started it’s long slide into the Abyss.   Why was this deal turned down?  Ego.  Jerry Yang’s ego took precedent over his primary responsiblity to the company and it’s shareholders.  He violated a basic principle of business.  Check your oversized ego at the door.  It’s not about you, it’s about your company and the shareholders who have made you disgustingly rich.

AIG

I am a believer in capitalism.  I believe that the strong, smart, and innovative survive and I believe that people should be rewarded for risks and performance.

It is for that reason that I find the behavior of AIG executives to be absolutely fucking disgusting.   It’s not enough that these losers ran a company in the ground that will costs tax-payers billions.  It’s not insulting enough that they needed a second bail-out only months later. and have driven the stock down 95% in one year.

http://finance.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximized&chdeh=0&chdet=1224224411260&chddm=98923&q=NYSE:AIG&ntsp=0

These non-performing no talent ass clowns were busy taking a trip to England to go bird hunting at the cost of 10K per person just days after emergency loans by the government.  While their investors sit with stock that is as close to worthless as it gets, they are busy hunting in a style reserved for royalty one hundred years ago.

I wish the populace were the same as they were 100 years ago.  If the stock holders a century ago  knew what was happening, they’d have them drawn and quartered.

People want transparency in the markets, they want to reward great CEO’s.  Steve Jobs is dying of cancer and he’s performed miracles at Apple Computer.  No one on the planet cares how much they pay him.  He has performed.  But these packages for failing CEO’s are enough to make even the staunchest free market fan like myself sick.

If you believe in the capital markets like I do, a cock-punch to one of these douche-bags isn’t out of the question.  Lehman’s CEO got knocked the fuck out in his own gym.  Kudos to the man who did it.  I don’t condone violence, but it’s likely the only consequences he’s had for shitting his company down the drain.

Fuck you Sebestain Preil.  Fuck you Alvaro Mengotti.  Fuck you for having no shame.  Fuck you for performing at a level slightly below retarded and slightly above dead.  I hope every day you walk into your office ready to piss yourself out of fear that someone who just lost all they put into your company breaks your fucking face.  That would be far more fair than what you deserve.

Michelle Caruso Cabrera

Michelle Caruso-Cabrere is definitely hot.  There is no question.  Check out the photos, and it’s definite proof.  But out in the blogosphere, there is some talk that she might eclipse CNBC hottie Erin Burnett.  Talk like that is pure bullshit.  There is always that guy who has to play contrarion.  They have to root for the underdog or like that shitty indie band that they declare is better than the Beatles.  This that instance.  Erin is still the Hawt on Wall Street, and I’ll prove it.
When you see Michelle, if asked a pointed question about sleeping with her, you’d definitely say you’d nail her.  She’s sexy.  But unless someone asked you specifically, it wouldn’t really enter your mind.  Let’s compre that to Erin Burnett.  Guys walking by the television with absolutely no prompting at all  and not knowledge of financial marekts will say “man…I’d fuck what Wall Street chick…

That my friends is the difference.  Yeah, you’d take Michelle home from the bar, but Erin’s the girl you’d be thinking about later.

Well, it’s time to take a look back. On the day of that post Yahoo was trading at $26 and change. At no point did it ever trade higher. Currently they are trading at $18 per share. Anyone who held absolutely lost their shirts. Good job Yahoo!

Yahoo Sucks

I am a huge XBOX Live fan. I purchased an XBOX 360, and enjoy both the hardware and the software. One of the greatest games of all time is one I play all the time and love.. Call of Duty 4: Modern Warfare

When it works…….

I am not only a consumer, I am an investor hell bent of making money in the stock market. Sometimes a consumer experience is relevant in investing in a company, and other times the underlying stock value has little to do with an individual customer experience.

In the case of Microsoft (MSFT), my bad individual customer experiences have been reflective of not only many customers, but most customers. Microsoft in their gaming divisions have done some things right, and it has built them an impressive lead. In other areas, Microsoft has execute so poorly, they are not only in danger of squandering their lead, but making me believe their fumbles are systemic in all divisions.

The Hardware:

This is the most obvious of Microsoft’s failures. The XBOX360 is quite simply a huge piece of shit. No one really knows the failure rates, but many users have had multiple systems fail. Mine has failed, 2/3rds of my friends have failed, and it’s so common, the local mail carrier carts off dozens of them a week.

This failure is inexcusable. There is nothing cutting edge or revolutionary about the 360. It is a generic legacy free PC. It uses a CPU, GPU, basic motherboard, harddrive, DVD, and USB connectors. Cheap PC makers pump out hundreds of different models and configurations on a montly basis, and NONE have the failure rates of the XBOX360 which has nearly identical physical components on all of them. No multiple drivers or systems to integrate.

Microsoft succeeded in becoming the worlds worst PC maker inside 18 months. This error has cost them billions of dollars. No one knows the complete numbers, but considering they were losing money on the consoles already, the cost has to be staggering. The good news is that those issues seem to finally be resolved.

The fact is, this never should have happened. Again, this is a basic PC. Soney (SNE) built theirs from the ground up with essentially custom made hardware, half of which they developed. They have a failure rate estimated at 2-3%. Sony has their own spectular failures, but from a strictly build perspective, Microsoft looks like a bunch of fucking amateurs. I can only assume they shit-canned the responsible party.

XBOX LIVE:

Recently, XBOX LIVE has been suffering huge setbacks. Over the holiday season, the millions of new users tried to sign on. Guess what. Microsoft wasn’t ready. After all of the examples of companies not being ready for the online onslaught, you’d think Microsoft, and technology company, would be prepared.

Microsoft keeps such close tabs, they can tell which store sold which XBOX360 by tracking the serial number. Try returning your xbox at a wal-mart when you didn’t purchase one there. You can see that they indeed track the purchases. Microsoft offers their LIVE service to all new purchases, so they know exactly how many they have sold and now many they expect to sign up for their service.

They know the demand. Their poor excuse isn’t acceptable. They will lose so many customers because they cannot make up for their poor first impression. First impressions are so incredibly sticky, that their lame attempt at a free download shows their lack of customer service. Don’t offer freebies on a service that is broken. How lame is that?

This is the holiday season. Make or break time for retailers. Microsoft has moved from an OS company, to a consumer products company. They are selling product to consumers who cannot, and wont dedicate time and skill to get a product working. This isn’t Microsoft Server 2000. You don’t own a virtual monopoly in this sector.

The market is in a down phase currently. I think the tech is oversold, but will continue to go down during panic selling. I think it’s a good time to s – l – o – w – y accumulate names like Intel, Apple, NOK, SUNW, etc. They are selling low, and might get to historically low P/E levels. That means you might have a killer portfolio in 3-5 years.

Microsoft I cannot give a thumbs up. They keep making mistake after mistake. Vista, despite the sales numbers, is not a good product. XP was a dream to install and setup and made a huge difference in my quality of computer. Vista just plain doesn’t do that.

Microsoft is a thumbs down. Apple, Intel, NOK are thumbs up.

If you follow stocks, and you should if you have a brain, you have no doubt turned on CNBC at least some point to see whats up with the markets movements.

If you are lucky enough to tune in the early part of the day, you have no doubt been lucky to see who is easily the hottest woman on television, Erin Burnett. If you think the financial markets aren’t exciting, you clearly have not been watching Erin Burnett. She isn’t just a smoking hot women faking it. She world for the premiere investment bank Goldman Sachs (I own GS) in mergers and acquisitions as a financial analyst.

Every luch hour, I trek down to the gym and tune in the television to CNBC and catch up with the markets. The best part? Half the women in the gym hear about interest rates and macro economics and don’t even give a second thought. You are free to watch this vixen do her thing. No glares from the women folk. They are clueless.

Watch this women while watching the market. How great is that?

Unfortunately, they like to throw in a couple old bastards to give the show some credibility. Fuck that. I watch the show every single day along with most other commentary. She’s got a great show. She asks relevant questions and isn’t afraid to call bullshit on some of these blow-hards.

Why is this guy even in the photo? If I was that old bird, I’d demand my photo be listed seperate from the smoking hot girl. I’m not jealous or anything. She calls me all the time. The word on the street is that she’s pretty stoked about meeting me. I’ll have to ring her up sometime when i have a couple free minutes.

You probably remember that months ago, I told you to load up the truck and buy Apple. (AAPL). If you listened to me, right now you would be sitting on an ass load of money. I told you that buying Apple on Jan. 2 would handsomely reward you, and it has. It rose from 83 dollars up to a quick upper 90s, and then back down again to start it’s slow steady rise to 122.67 as of close.

I think iPhone will be huge, and so do a lot of other people. So why do I think you should dump AAPL? Because most people aren’t going to let their gain just ride, and its the end of he financial quarter. That means every money manager who has to show gains this financial quarter needs to sell a winner. The risk of profit taking makes the possibilities of a sell off after such a gain very possible. One only needs to look at the action of this stock after the announcement of the iPhone for guidance.

If history repeates itself, there will be some serious profit taking and give you a chance to buy in Apple again before a run up to their earnings that reflect the sales of the iPhone.

Disclaimer:  I own Apple.  I will be selling a significant portion of my holdings.  I am not providing advice, only commentary.  If you take any advice from an anonmyous blog without your own research, you are a serious dumbass.

It’s such a shit idea, you almost immediatly dismiss it out of hand as the work of jackass rumor mongers for the sake of shorting the stock. There is no way they are this dumb. It’s not possible.

Nope. Turns out the rumors are true. General Motors, the company that has managed to piss away a virtual monopoly, will now acquire another shitty american car company. Once it makes its bid for Ford, it will truly have a U.S. car making shit sandwhich.

General Motors is more pathetic than the list of potential fathers for Anna Nicole Smith’s baby. And you can bet your last dollar that their financial plans of hitting the lottery for banging a fat bloated drug addicted has been, has more more viability than buying Chrysler.

The Germans have been chomping at the bit to dump that fat hog. (Chrysler, not Anna) Chrysler is the fat girl on your dodgeball team that you cannot wait to get rid of. You are just hoping the teacher will badger someone else to pick her first. You’ll pick the kids who chews on his own erasers first than pick her because at least he is a smaller target.

The good part is you were here. You get to remember the day when the gun was put to the head and the trigger was pulled. It’s poetic justice really. We nuked Japan, and Japan nuked Detroit. It’s a fair trade when you think about it.

In the interest of full disclosure, I own stock in Toyota Motors, and I’ll look forward to shorting Ford (F) all the way to zero.