Google Goes the Way of the Newspaper?

Greetings from New York, where today’s word is “flexible thought.” Well, that's actually 2 words - but that just demonstrates my flexibility.

Which brings us to yesterday, when I did every form of television, save Fast Money, which is the show I actually call home. During one of these segments, Jon “Not Pete” Najarian taunted me about Google (GOOG). Specifically he said, “as right as Jeff was about Gannett (GCI), he’ll be wrong on Google.” (For those catching up, I’ve been saying Google is every bit as exposed to the ad slump as newspapers like Gannett; Google just trades at a higher multiple.) Jon even bet me lunch on the idea.

Now, I’m a trader by profession and a student of the big picture by hobby. In the big picture, Google is going down; it’s simply a matter of time. In terms of trading, anything can happen, and I’ve learned not to unnecessarily pick fights with Najarians. Any of them. Even Dr. Najarian, who was born in 1927, is a renowned transplant surgeon and built his 4 sons in the basement of the Najarian home. I’m pretty sure he could also still kick my butt from pillar to post.

So, I changed my mind and bought Google at 380-something and a price target of 4-anything. To say the trade lacked commitment is to suggest Oceans 13 lacked a coherent plot; obviously it didn’t, but I fail to see why that matters in the least. Bottom lines are these: I missed my 4 handle target fill but got $399. I could have tried to be cute and get my 400, but “cute” is really not my best pitch. I then sold Google and flipped it to a short position, which I currently have on my books with a thesis that makes Oceans 13 look like Michael Clayton (in other words, the short trade is coherent, deep and worth repeated viewings whereas the long was all about money).

What did we learn: 1. Stay nimble, both in your book and your thoughts. 2. Don’t confuse the ability to argue with being right; the goal of an argument is to convince your foe, not yourself. The point of arguing in the “debate” sense is to get both sides of any story. 3. If you lack conviction on a position, book gains when you can (as opposed to taking losses when you have to).

Finally, and don’t bother trying to stop me no matter how many times you’ve heard this before: “There’s no sin in being wrong; the sin is staying wrong."