Sorry Hosni, You Can't Turn Off the Internets

I see this epsisode as an unintended but gargantum scientific experiment that had to come sooner or later.

We are testing Hosni’s Law which states that once an autocrat attempts to turn off the internet, it is too late for him.

If he falls, it will serve as caution to other autocrats. They will recognize that this is not an option.

Remember when we used to call it the World Wide Web?

I must admit that there is a part of me that loves the fact that Hosni Mubarak attempted to turn off the internet in Egypt.

Not because I want to see him succeed or disagree with Fred Wilson’s fear that a revolutionary technology which, in 20 years, has become essential to global communication, commerce and social interaction can be shut down with a half dozen phone calls in a nation of 83 million people.

Its just that I don’t think it can be. I don’t believe such a tactic can be used effectively politically as it reveals weakness and vulnerability more than power.

I see this epsisode as an unintended but gargantum scientific experiment that had to come sooner or later.

We are testing Hosni’s Law which states that once an autocrat attempts to turn off the internet, it is too late for him.

If he falls, it will serve as caution to other autocrats. They will recognize that this is not an option.

Remember when we used to call it the World Wide Web?

It was a hokey name and we were naive but it captured the spirit and the force of what was coming. With every new interconnection, the web grows more robust and there are many new interconnections occurring every moment.

I have no idea what leadership will replace Mubarak’s rule.  Its complex and I am not an expert. But I do know that if he falls here, one small but important lesson of this unfolding drama will have affirmed the resiliency of the web.

Netflix and the Lesson of a Crowded Short

At its best, shorting stocks on fundamentals over a longer period should be a lonely endeavor in which the particpant is derided. It should be betting the don’t pass line at a craps table even as the rest of the table bets the pass line.

Traditionally, short sellers are perceived as being a smart and cunning breed running against the herd but in some instances they ARE the herd.

$NFLX reported solid earnings last night including 63% subscriber growth yoy, the stock price is up huge and making all time highs on big volume and noted short seller of the stock Whitney Tilson must be twisting.

The interesting thing to me though and the lesson for traders concerns the legion of shorts and skeptics in general who were already aboard and who hopped aboard to ride Tilson’s call.

At its best, shorting stocks on fundamentals over a longer period should be a lonely endeavor in which the particpant is derided. It should be betting the don’t pass line at a craps table even as the rest of the table bets the pass line.

When its not there is a problem.

I asked seasoned short seller Seabreeze Partners Doug Kass to comment and he had this to say,

I learned a lesson a long time ago. Life is too short to be short companies like $NFLX where as recently as December 31 over 30% of the float was short.  Squeezes happen routinely under these circumstances.  Add to that how well the company is executing on its strategy as reflected in its subscriber growth and its a clearly dangerous situation.

I learned from Doug a long time ago that the popular shorts are not the best ones as this instance attests.

The Headline Bubble

I was going to call this post “The Three Things You Need to Know About Why I Scratch My Expanding Ass” but I am more refined than that. 🙂

Nevertheless, there is a Headline Bubble inflating across the blogosphere and online news and commentary media in general.

More page views are required and so more content must be created or reblogged or scraped ever more quickly.

As a result, the length editors go in order to grab attention spirals higher.

Like all bubbles, this will continue longer than rational actors envision but make no mistake this balloon will go pop.

There will also come a time in the not too distant future when the perception of bloggers who have their content pulled directly onto aggregation sites will shift from,

“great, I am getting more exposure.”

to

“no, please do not take my content and my page view from me.”

This process has already begun.

Market Shrinkology 01/05/11: Interview w/ Eli Radke

We are catching, Eli Radke a special kid still in the somewhat early stages of his development as a trader. The beauty of this interview for me is his frankness and humility as well as a quiet intelligence that sneaks up on you and is so distinct from some guys who throw even their mediocre ideas in your face.

Thanks for taking the time @ERadke!

We are catching, Eli Radke a special kid still in the somewhat early stages of his development as a trader. The beauty of this interview for me is his frankness and humility as well as a quiet intelligence that sneaks up on you and is so distinct from some guys who throw even their mediocre ideas in your face.

Thanks for taking the time @ERadke!

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