Post by particleswaves on Oct 9, 2005 7:45:47 GMT -6
bobosrevenge.blogspot.com/
Dr. Patrick Byrne's Message to the Motley Fool Board
Usually Sanity Check is my bully pulpit, from which I pontificate, complain, berate, and mock.
Especially mock. Nothing drives powerful forces up to no good crazier than being mocked. It is almost as though once you have the tens or hundreds of millions of dollars, the next must have is the awe and respect of a breathless public. And when a fun-filled rodent mocks you, or shines a light on your ugly hypocrisy, that apparently doesn't go over very well.
Which is part of the joy in doing it.
This segment of our regular broadcast will be devoted to the enormously erudite and insightful words of a man I have grown to respect, both intellectually, as well as for intestinal fortitude and true moral integrity. As one goes down the road of life it is all to often that our actions seem small and pointless, and our will to excel or attempt the daunting diminishes over time. Dr. Byrne has a way of demanding more out of himself, as well as those fortunate enough to share his company, and by doing so, leads by example. That is rare. Rarer still is a guy who does the right thing, even when he knows doing so will be invite character assassination, will subject him to enormous hardship, and will gain him little or nothing personally from doing it. Dr. Byrne is without question one of the rare ones.
This was posted by Dr. Byrne on the Motley Fool message board today, and represents his capsule summary of the latest rounds of slanderous charges against him, as well as his responses. It should be required reading for anyone that questions his character, his abilities, his commitment, or his honesty.
Without further ado, here is the content of that post:
" Dear Fools (Motley and Otherwise),
Bill has written an excellent piece on the battle we are waging. In that article he quite fairly suggests that something about the news coverage so far seems strangely misguided, but that also, my own over-the-top behavior my be hurting my cause. Again, it is fair to say that, but I would politely respond that my behavior is not so over-the-top is many would pretend, as should be clear when all the truths are known. However, Mr. Mann has given me an idea: I am going to answer some of the flak that gets shot at me by various parties, and then ignore it in the future. I do this both to give the general reader a more detailed look at my arguably over-the-top behavior, and also so that, when folks come back and post and repost the criticisms, perhaps some friendlies can answer for me by copying and pasting from what appears below.
Why do I do this? Because I feel that this is how conversations with SOME (unnamed people) go:
Me: I went out last night to see a movie.
Hostiles: But you were seen at midnight in Howard Johnson's having an ice cream!
Me: That's right, on the way home I stopped at Howard Johnson's to have an ice cream.
Hostiles: But why'd you say you went out to see a movie when you had an ice cream?!? Why didn't you say you had ice cream the first time? And besides, how could you have had an ice cream at the movies? I've been going to movies for 25 years and they don't serve ice cream there. Well, they do in some, but which movie theater were you in having ice cream anyway? I bet it does not serve ice cream and besides, you were wearing a blue shirt, but three years on a conference call you said you prefer red to blue, so were you lying then or now? And what about the ice cream?
In other words, sometimes sincere, sometimes trivial, sometimes self-contradictory stuff which I generally ignore for three reasons:
1) I suspect it is transparent to most adults, and so they don't need me to answer it anyway;
2) When I assume the best and answer it anyway, the person just goes on and on anyway as though I have not answered to drown out my response, or finds something else in my answer to jump on, which leads me to...;
3) I suspect at times that the writer is just trying to waste my time and obfuscate any informative discussion. Thus he does not really believe what he writes anyway, and thus I should not waste time answering points that are not sincerely being asserted. That said, I will, for the record answer all the things that have been bandied about that I can remember at the moment. I will do so clearly, and then I will ignore further discussion on them: again, I ask of readers who follow these matters, when they see the kind of behavior described above, just cut and paste from below and answer for me, to save me answering the same (often trivial or harassing) questions over and over:
A) The SPE for the diamond: we have a great relationship with some folks in the diamond industry who wish to remain in the background. We need their expertise, they need our channel. The SPE gave us a way to compartmentalize our work together and get the economics extremely clean and auditable.
B) Press release: We release news when we have it. We had a 5 week hiatus in uploading products, but as we got that part of the system nearly working it occurred to us to do a marketing blitz about it. We send emails Monday, Wednesday, and Friday, and so decided to devote one of them to pound a "largest inventory upload in our history!" theme, along with a bunch of messaging on our home page, along with some messages to our affiliate marketing partners (who focus a lot on new inventory), along with a press release that we hoped would get picked up in a few newspapers and drive some consumers to the site.
I reviewed the marketing email theme and the home page messaging, and wrote the bones of a press release over the weekend. But the inventory upload was not working by Sunday (though we hoped it might be), so scratched it for the Monday email. IT kept working away on the program and we hoped we could upload Tuesday, but the program kept clogging, so we scratched Wednesday. Thursday it began working in fits and starts, but did not get out of test mode until around 11 PM Thursday night. They began uploading products through the night, saying it would take until sometime Friday for all to be complete (I believe there were tens of thousands of products). Someone in marketing made the (correct) decision to release the Friday marketing email to about 6 million people, but set it to go later in the morning than our normal email, I believe, to give time for more products to be populating the site. The product loader continued running at full blast until noon on Friday. We knew we had uploaded somewhere between $16 million and $40 million of inventory, depending on what one counted and how one counted it, and asked for IT to run a query to get an answer. They came back at 1:40 PM with the number (I think it was $30 million). We are in Utah: 1:40 PM is 3:40 PM in New York. Our guys put out a press release twenty minutes later.
Somewhere late in that process it occurred to us to add to the end of the press release a section for the benefit of shareholders, filling them in on internal events, as is my habit with quarterly earnings letters. Also, somewhere late in that process when it became clear when we would be hitting the "Go" button it occurred to some among us: "Wait! If you release news on a Friday afternoon people say you are trying to bury it." I gave that objection somewhere less than 10 seconds of consideration before deciding to ignore it for the following reasons:
i) It is a dumb convention:_____a) It dates from the days of print journalism;_____b) The rest of the world works on Friday afternoon until 5: so can Wall Street.
i) I don't care about Wall Street conventions anyway (anyone notice how we went public, or our earnings letters, or our earnings calls, etc.?)
iii) It seems right to release news when we have it, and to ignore all such considerations anyway (with the exception of not releasing news on weekends, and the possible exception of placing important news at the beginning or end of a trading day);
iv) If we did not release it Friday we had to wait until Monday, but the whole point was to get it to coincide as closely as possible with the 6 million recipient marketing blast and the home page announcement.Now among my colleagues there may have been some whose reaction was, "Perception is reality." The mere fact that some will perceive it as objectionable means that it IS objectionable!” To which my internal response was, “Above nearly any expression I can think of, I detest 'Perception is reality' above all. Reality is reality, perception is perception: get that neo-Kantian drivel out of here (Immanuel Kant is the enemy of the human race, but that is for another day). I deal in reality, not perception. Etc.” Well, my response was not so philosophical, but that is about what I was thinking. (If you had a choice between doing A and B, and you knew A was the right thing to do and B the wrong, but you knew that the arrangement of facts was such that the world was going to see A as being wrong and B right, which would you do? You do the right thing and take your lumps.)
Of course, the usual suspects showed up on blogs and message boards within a few days: "Can you believe that they ignored a convention of Wall Street and put out news on a Friday afternoon?!?!?!? Oh my God!!!!!!!!!! Don't they know that there is a convention of Wall Street that says you don't do that?!?!?! And they ignored it?!?!?! Oh my God!!!!!!!!!! How could anyone ignore a convention of Wall Street?!?!?!”
C) Moles and disinformation: this is one of those things that I explained on the Miscreants' Ball conference call, knowing full well that the bad guys would twist it all around and make hoo-hah about it. But consider: in Bill Mann's excellent piece on our three affidavits one of his most telling points is something he puts quite subtly. "Unlike a lot of the silliness in the media relating to Overstock, this complaint is not frivolous on its face, and although Overstock will need to prove its allegations, the case must be taken seriously. The question to us is why the atmosphere around this lawsuit has, from the beginning, been comical."
I told this story with care on my Miscreants' Ball call, and will tell it again with greater care here. I ask the reader to consider it against how it was treated by a few members of the "press". Compare this story to what they wrote, for it perhaps gives a road map to who the bent journalists are.
Sometime last autumn I came to suspect I was being bugged because in a phone call to my girlfriend (Gina, the woman in New York who runs a restaurant whom I have mentioned in a conference call or two) a figure of speech I used showed up on the message boards in a posting from a basher. I do not remember the expression, but I recall it was neither a common one nor a really arcane one. I think it was something along the lines of, "Such-and-such an idea of mine really sh-t the bed." A few days later, an attacker on Yahoo (the message board was not so clogged then that I could spend 20 minutes once or twice a week and catch up on it) then wrote something like, "Byrne's idea on such-and-such really sh-ts the bed." I don't recall the idea or if this was the precise expression, so I am just trying to give a feel for it: the expression was just odd enough and the Yahoo post just dead on enough that it piqued my suspicion.
About this same time, as you will understand when the whole story gets told someday (I hope Brad Pitt plays me in the movie!), I began to get a lot clearer picture of the players involved in the Miscreant's Ball, including certain professionals who have a reputation for being as crooked as the day is long and who are quite capable of bugging phones and apartments (and whose modus operandi includes placing moles).
In any case, when next I saw Gina, we agreed that we would test this occasionally and try to confirm or falsify it. I considered using financial information, but decided against it for two reasons. First, it gets stale within months, and if I lied one time ("Gina, we are having a terrible Christmas!") and then later came out with a good one, the miscreants would know I was on to them. Secondly, if I did it and people (even miscreants and blackguards) started trading on it in the marketplace, then it would be like poisoning a town well supply to get at a few hooligans. So if I could not use financial information, I had to use personal information: thus, we agreed on "cocaine" for the cell phone and "gay" for the landline, that periodically we would put that information down those channels and see if it bubbled up anywhere. Again I apologize to anyone offended by appearing to equate the two: I just needed two things that, if they appeared, I would have no question about where they came from nor would I care if they appeared. (Incidentally, it was in that context that I mentioned on the Miscreants Ball conference call that with the exception of one evening I have never even seen coke in my life, so if the rumor appeared I would have no doubt where it came from: in the hands of the miscreants that turns into "Why is Byrne denying he is a cokehead? He must be a cokehead!").
Within a few weeks I did start noticing occasional message board posts along the lines of, "Byrne is such a f-g." But nothing decisive, and for all I know it was some 15 year old. Then I got a call from my old dissertation advisor from Stanford, who now lives in England. He told me that a woman had called him claiming to be an investor doing due diligence, and wanted to ask about me. She had asked him a lot of personal questions about me, including was I into drugs, especially cocaine. Again, nothing conclusive (although such due diligence is common with privately held companies, and not the kind of thing that mutual funds or legitimate investors do when considering buying stock in a public company, in my experience).
Then in this July's conference call I described how tightly held OSTK is by myself and my parents, my brothers and cousins ("folks I had taken a bath with" when I was a toddler), a few friends, and 10 institutions. Almost immediately a reporter named Carol Remond, whom is widely thought to be in league with the same hedge funds I am battling (look for companies that David Rocker is short that Carol has written stories on), starting calling people to tell them that the phrase "folks I had taken a bath with" was a reference to (I kid thee not) a gay bathhouse cabal which I run. Again, I kid thee not.
Now is any of that decisive? No. As I say in my conference calls, "You now know everything I do." Well, not actually, but you know a lot.
(continued)
Dr. Patrick Byrne's Message to the Motley Fool Board
Usually Sanity Check is my bully pulpit, from which I pontificate, complain, berate, and mock.
Especially mock. Nothing drives powerful forces up to no good crazier than being mocked. It is almost as though once you have the tens or hundreds of millions of dollars, the next must have is the awe and respect of a breathless public. And when a fun-filled rodent mocks you, or shines a light on your ugly hypocrisy, that apparently doesn't go over very well.
Which is part of the joy in doing it.
This segment of our regular broadcast will be devoted to the enormously erudite and insightful words of a man I have grown to respect, both intellectually, as well as for intestinal fortitude and true moral integrity. As one goes down the road of life it is all to often that our actions seem small and pointless, and our will to excel or attempt the daunting diminishes over time. Dr. Byrne has a way of demanding more out of himself, as well as those fortunate enough to share his company, and by doing so, leads by example. That is rare. Rarer still is a guy who does the right thing, even when he knows doing so will be invite character assassination, will subject him to enormous hardship, and will gain him little or nothing personally from doing it. Dr. Byrne is without question one of the rare ones.
This was posted by Dr. Byrne on the Motley Fool message board today, and represents his capsule summary of the latest rounds of slanderous charges against him, as well as his responses. It should be required reading for anyone that questions his character, his abilities, his commitment, or his honesty.
Without further ado, here is the content of that post:
" Dear Fools (Motley and Otherwise),
Bill has written an excellent piece on the battle we are waging. In that article he quite fairly suggests that something about the news coverage so far seems strangely misguided, but that also, my own over-the-top behavior my be hurting my cause. Again, it is fair to say that, but I would politely respond that my behavior is not so over-the-top is many would pretend, as should be clear when all the truths are known. However, Mr. Mann has given me an idea: I am going to answer some of the flak that gets shot at me by various parties, and then ignore it in the future. I do this both to give the general reader a more detailed look at my arguably over-the-top behavior, and also so that, when folks come back and post and repost the criticisms, perhaps some friendlies can answer for me by copying and pasting from what appears below.
Why do I do this? Because I feel that this is how conversations with SOME (unnamed people) go:
Me: I went out last night to see a movie.
Hostiles: But you were seen at midnight in Howard Johnson's having an ice cream!
Me: That's right, on the way home I stopped at Howard Johnson's to have an ice cream.
Hostiles: But why'd you say you went out to see a movie when you had an ice cream?!? Why didn't you say you had ice cream the first time? And besides, how could you have had an ice cream at the movies? I've been going to movies for 25 years and they don't serve ice cream there. Well, they do in some, but which movie theater were you in having ice cream anyway? I bet it does not serve ice cream and besides, you were wearing a blue shirt, but three years on a conference call you said you prefer red to blue, so were you lying then or now? And what about the ice cream?
In other words, sometimes sincere, sometimes trivial, sometimes self-contradictory stuff which I generally ignore for three reasons:
1) I suspect it is transparent to most adults, and so they don't need me to answer it anyway;
2) When I assume the best and answer it anyway, the person just goes on and on anyway as though I have not answered to drown out my response, or finds something else in my answer to jump on, which leads me to...;
3) I suspect at times that the writer is just trying to waste my time and obfuscate any informative discussion. Thus he does not really believe what he writes anyway, and thus I should not waste time answering points that are not sincerely being asserted. That said, I will, for the record answer all the things that have been bandied about that I can remember at the moment. I will do so clearly, and then I will ignore further discussion on them: again, I ask of readers who follow these matters, when they see the kind of behavior described above, just cut and paste from below and answer for me, to save me answering the same (often trivial or harassing) questions over and over:
A) The SPE for the diamond: we have a great relationship with some folks in the diamond industry who wish to remain in the background. We need their expertise, they need our channel. The SPE gave us a way to compartmentalize our work together and get the economics extremely clean and auditable.
B) Press release: We release news when we have it. We had a 5 week hiatus in uploading products, but as we got that part of the system nearly working it occurred to us to do a marketing blitz about it. We send emails Monday, Wednesday, and Friday, and so decided to devote one of them to pound a "largest inventory upload in our history!" theme, along with a bunch of messaging on our home page, along with some messages to our affiliate marketing partners (who focus a lot on new inventory), along with a press release that we hoped would get picked up in a few newspapers and drive some consumers to the site.
I reviewed the marketing email theme and the home page messaging, and wrote the bones of a press release over the weekend. But the inventory upload was not working by Sunday (though we hoped it might be), so scratched it for the Monday email. IT kept working away on the program and we hoped we could upload Tuesday, but the program kept clogging, so we scratched Wednesday. Thursday it began working in fits and starts, but did not get out of test mode until around 11 PM Thursday night. They began uploading products through the night, saying it would take until sometime Friday for all to be complete (I believe there were tens of thousands of products). Someone in marketing made the (correct) decision to release the Friday marketing email to about 6 million people, but set it to go later in the morning than our normal email, I believe, to give time for more products to be populating the site. The product loader continued running at full blast until noon on Friday. We knew we had uploaded somewhere between $16 million and $40 million of inventory, depending on what one counted and how one counted it, and asked for IT to run a query to get an answer. They came back at 1:40 PM with the number (I think it was $30 million). We are in Utah: 1:40 PM is 3:40 PM in New York. Our guys put out a press release twenty minutes later.
Somewhere late in that process it occurred to us to add to the end of the press release a section for the benefit of shareholders, filling them in on internal events, as is my habit with quarterly earnings letters. Also, somewhere late in that process when it became clear when we would be hitting the "Go" button it occurred to some among us: "Wait! If you release news on a Friday afternoon people say you are trying to bury it." I gave that objection somewhere less than 10 seconds of consideration before deciding to ignore it for the following reasons:
i) It is a dumb convention:_____a) It dates from the days of print journalism;_____b) The rest of the world works on Friday afternoon until 5: so can Wall Street.
i) I don't care about Wall Street conventions anyway (anyone notice how we went public, or our earnings letters, or our earnings calls, etc.?)
iii) It seems right to release news when we have it, and to ignore all such considerations anyway (with the exception of not releasing news on weekends, and the possible exception of placing important news at the beginning or end of a trading day);
iv) If we did not release it Friday we had to wait until Monday, but the whole point was to get it to coincide as closely as possible with the 6 million recipient marketing blast and the home page announcement.Now among my colleagues there may have been some whose reaction was, "Perception is reality." The mere fact that some will perceive it as objectionable means that it IS objectionable!” To which my internal response was, “Above nearly any expression I can think of, I detest 'Perception is reality' above all. Reality is reality, perception is perception: get that neo-Kantian drivel out of here (Immanuel Kant is the enemy of the human race, but that is for another day). I deal in reality, not perception. Etc.” Well, my response was not so philosophical, but that is about what I was thinking. (If you had a choice between doing A and B, and you knew A was the right thing to do and B the wrong, but you knew that the arrangement of facts was such that the world was going to see A as being wrong and B right, which would you do? You do the right thing and take your lumps.)
Of course, the usual suspects showed up on blogs and message boards within a few days: "Can you believe that they ignored a convention of Wall Street and put out news on a Friday afternoon?!?!?!? Oh my God!!!!!!!!!! Don't they know that there is a convention of Wall Street that says you don't do that?!?!?! And they ignored it?!?!?! Oh my God!!!!!!!!!! How could anyone ignore a convention of Wall Street?!?!?!”
C) Moles and disinformation: this is one of those things that I explained on the Miscreants' Ball conference call, knowing full well that the bad guys would twist it all around and make hoo-hah about it. But consider: in Bill Mann's excellent piece on our three affidavits one of his most telling points is something he puts quite subtly. "Unlike a lot of the silliness in the media relating to Overstock, this complaint is not frivolous on its face, and although Overstock will need to prove its allegations, the case must be taken seriously. The question to us is why the atmosphere around this lawsuit has, from the beginning, been comical."
I told this story with care on my Miscreants' Ball call, and will tell it again with greater care here. I ask the reader to consider it against how it was treated by a few members of the "press". Compare this story to what they wrote, for it perhaps gives a road map to who the bent journalists are.
Sometime last autumn I came to suspect I was being bugged because in a phone call to my girlfriend (Gina, the woman in New York who runs a restaurant whom I have mentioned in a conference call or two) a figure of speech I used showed up on the message boards in a posting from a basher. I do not remember the expression, but I recall it was neither a common one nor a really arcane one. I think it was something along the lines of, "Such-and-such an idea of mine really sh-t the bed." A few days later, an attacker on Yahoo (the message board was not so clogged then that I could spend 20 minutes once or twice a week and catch up on it) then wrote something like, "Byrne's idea on such-and-such really sh-ts the bed." I don't recall the idea or if this was the precise expression, so I am just trying to give a feel for it: the expression was just odd enough and the Yahoo post just dead on enough that it piqued my suspicion.
About this same time, as you will understand when the whole story gets told someday (I hope Brad Pitt plays me in the movie!), I began to get a lot clearer picture of the players involved in the Miscreant's Ball, including certain professionals who have a reputation for being as crooked as the day is long and who are quite capable of bugging phones and apartments (and whose modus operandi includes placing moles).
In any case, when next I saw Gina, we agreed that we would test this occasionally and try to confirm or falsify it. I considered using financial information, but decided against it for two reasons. First, it gets stale within months, and if I lied one time ("Gina, we are having a terrible Christmas!") and then later came out with a good one, the miscreants would know I was on to them. Secondly, if I did it and people (even miscreants and blackguards) started trading on it in the marketplace, then it would be like poisoning a town well supply to get at a few hooligans. So if I could not use financial information, I had to use personal information: thus, we agreed on "cocaine" for the cell phone and "gay" for the landline, that periodically we would put that information down those channels and see if it bubbled up anywhere. Again I apologize to anyone offended by appearing to equate the two: I just needed two things that, if they appeared, I would have no question about where they came from nor would I care if they appeared. (Incidentally, it was in that context that I mentioned on the Miscreants Ball conference call that with the exception of one evening I have never even seen coke in my life, so if the rumor appeared I would have no doubt where it came from: in the hands of the miscreants that turns into "Why is Byrne denying he is a cokehead? He must be a cokehead!").
Within a few weeks I did start noticing occasional message board posts along the lines of, "Byrne is such a f-g." But nothing decisive, and for all I know it was some 15 year old. Then I got a call from my old dissertation advisor from Stanford, who now lives in England. He told me that a woman had called him claiming to be an investor doing due diligence, and wanted to ask about me. She had asked him a lot of personal questions about me, including was I into drugs, especially cocaine. Again, nothing conclusive (although such due diligence is common with privately held companies, and not the kind of thing that mutual funds or legitimate investors do when considering buying stock in a public company, in my experience).
Then in this July's conference call I described how tightly held OSTK is by myself and my parents, my brothers and cousins ("folks I had taken a bath with" when I was a toddler), a few friends, and 10 institutions. Almost immediately a reporter named Carol Remond, whom is widely thought to be in league with the same hedge funds I am battling (look for companies that David Rocker is short that Carol has written stories on), starting calling people to tell them that the phrase "folks I had taken a bath with" was a reference to (I kid thee not) a gay bathhouse cabal which I run. Again, I kid thee not.
Now is any of that decisive? No. As I say in my conference calls, "You now know everything I do." Well, not actually, but you know a lot.
(continued)
, great read particles. Thanks for bringing it over.