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Buzz Bits


You guys are the bomb!


"The Legg Mason comments on Overstock, based on what I read in the Buzz, are nonsense. As I write today in my column, the competitive hit on Amazon merely suggests the entire space is getting uber-competitive. I mean, Overstock itself has to cap gross margins at 15%, and analysts hammered earnings estimates because Overstock itself is getting competition from left and right.

It's a liquidator, for goodness sakes, and that's a tough business that, as we are now learning, involves (surprise, surprise) writing off garbage that doesn't sell. As I've written here before, there's Even is back in the fray. Everybody's trying to sell goods at, near or below cost. Great business model!

Toddo, I was among those who questioned Amazon's model early on when its stock got lifted in the Googleesque stratosphere. Amazon emerged as a very well-executed business. But even Amazon is conceding that it's tough out there. It will be tough for the competitors, too!"

--Vibes from our good friend Herb Greenberg at

Headline on my Bloomberg: "Futures traders trim bets on Fed rate increase after payrolls". Just thinking out loud here: at what point do those economic (and market) bulls out there start to worry that all that stimulus STILL hasn't produced any real jobs (and indeed now are showing net job losses when you account for just the new entrants into the labor pool). At what point do they realize the Fed - that omnipotent director of the economy - is a eunuch?

--Scotto Reamer

The national trend for venture funding is on the rise. I mention this because venture funding, driven by stock market gains, was a primary component of the economic health we enjoyed in the late 1990s.

About a year ago, I mentioned employee-wanted postings on a technology list I'm a member of started increasing. Jobs recovery soon followed. While I strongly believe venture investing's impact on the economy will never be what it was in the 1990s (spending will be much more restrained), ignoring its impact on the economy is perilous.

As for the Fed being a eunuch, considering bad policy moves like the dividend tax cut removed the typical multiplier from their actions and the erasure of a decade-long peace dividend on one bad day in September I don't think they've done too bad. I still marvel at the fact our economy over the last 3.5 years ran at a level that would have been considered a rousing success when examined from the perspective of other, real economic downturns in our nation's past. Just one guy's opinion...

--David Miller

We're not getting much out of Mr. Greenspan this morning. It sounds like he is trying not to "upset" the markets. His comments so far have been merely sensible and quoting economic logic. We cannot read any "directional" thoughts into them.

--John Succo

Let me tell you good story about Herb Greenberg as it relates to his brutally honest (and as a result exceptionally insightful) analysis. Back in 1999 or 2000 when I was a sell-side analyst covering AMZN, I was on FOX news - some sort of roundtable on a bunch of stocks I recall. Herb was a guest as were two others. Anyway, AMZN comes up as a topic and I was the only sell-side analyst at the debate and I actually had a buy on the stock at the time - can't remember the rationale but something along the lines that it had gotten hit pretty hard and that the business hadn't fallen apart so oversold, expect a bounce, blah blah blah. Real 'trees and not forest' comments.

Anyway, I made my (clearly weak) case for the stock and Herb says (I am entirely paraphrasing here but you get the point): "Scott, Target is growing 20%, Wal-Mart is growing 10%...Amazon is growing at 14% a year! Why is this thing valued infinitely more highly than either one but is a tiny fraction of their sales and showing no profits whatsoever?"

One of the reasons I was frequently asked back on shows like these was because I could think on my feet and had good soundbites. Neither of these attributes have anything to do with either smarts or success but such is show business. In any case, Herb said that and I froze. I mean it: I froze solid. My eyes didn't blink, I stopped breathing. And I stared at him.

After about 10 seconds (an eternity on TV) the moderator said "Scott?", and I stammered, uh-hummed, cleared my throat, etc. I can't even remember what I said after that, it was almost certainly complete gibberish and to this day stands as the worst piece of television I ever did. I'm not kidding you when I say that every so often I still have dreams about it. Dreams are too kind; nightmares is the right word.

Herb's 'emperor has no clothes' style - like in the Overstock example above - is utterly devastating to flawed logic and gibberish.

And I thank God I was on the receiving end of that only once.

--Scotto Reamer


No positions in stocks mentioned.

Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at

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