I call out CNBC on the bailout

Fast Money (CNBC)

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The initial overheated tone of this post has been edited to better reflect my points and remove the bad words and unreasoned insults that were placed there in the heat of the moment. I’m glad that the commenter, posing as the real Macke, called me out. AW

10/05/2008 I am removing any references to Mr. Jeff Macke. I am retracting my indictment of him in any way. Instead, I refer people to the CNBC Program Fast Money – to the episode archive where Mr. Macke comments on Senator Shelby’s review of the the first ‘no’ vote on the rescue plan. I will endeavor to get that clip posted. It really set me off. There was no need, however, to put Jeff Macke in the greater mix of my emotions on the dirty deal. I will let the comments stand.

Many financial commentators on CNBC seem to be very free with your money. Some recent comments on Fast Money, tend to say that the Fed and the Treasury should give your money to the banks that screwed us. Despite the fact that professional traders have generally profited and watched while the entire market was leveraged up, that the professional equities trading and management business is taking a beating, (unless the cake is handed out), it is an insult that professional commentators are taking a pro-position on the legislation just passed. Mr. Taxpayer, they got it done. Lambasting Senator Shelby for putting the brakes on this benighted plan to take money out of your pocket and placing it at the disposal of the Fed has me very angry.

The CNBC commentators, it seems to me, dispense superficial commentary. They talk fast and say nothing, covering the same talking points and revealing no insight whatsoever. The only things we hear out of their mouth seems to be positions that bolster what is good for Wall Street.

I usually expect more reasoned argument from Karen Finerman; in the last analysis, however, Ms. Finerman is a trader, and she needs to keep her cake in the oven. Dylan Ratigan seems to be the most level headed of the group, expressing and exposing the counter position sometimes, but overall, he takes the pro position and explains the best he can that this was a necessary deal.

There are other CNBC anchors that take a reasoned approach and who seem to be opposed, if not to the deal itself, to the “hurry up” nature of the deal.

People, we have been taken  down this bad road by the people and pols that actually engineered the seeds of the disaster. These are the selfsame people who could have regulated the processes. Instead, they actually watched as it unfolded over a period of years. This is legacy of the Bush administration, their friends the wealthy, and professional traders. They berate those who dare pour cold water on this abominable deal. This was an insult…and more injurious to you the taxpayer, than doing nothing and letting the market take its toll. Let the private equity market make good what it made bad.

Numerous financial commentators have been so wrong on this subject; This should have been a market driven solution that limited the taxpayer’s participation. Many economists have advocated an open, transparent electronic exchange for the distressed assets. That would be a start. Most of the taking heads on networks like CNBC want the cake to be pumped into the selfsame corrupt investment banks that engineered the crisis, and also want interest rates to be essentially  cut to approach zero. These are all bad ideas.

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Microsoft Buys Yahoo Search biz – Why is this a good idea?

I dont get it, maybe Im not the smartest guy, but some questions arise:

1) how will Microsoft retain the brand image of Yahoo search – I mean it is almost a sure thing that no matter what they buy will devolve into another MS Live-Blah misbranded product? no?

2) what will Yahoo do with the missing search revenue? Just replace it with Google. I thought that Yahoo has sunk almost a billion into its search platform R&D, – isnt this an admission that they have failed? If so, why would MS want it?

I have a good friend who was invited to “jury” for Yahoo’s senior search team. That is the only way he could describe it – A Ph D. style juried dissertation taking place over 4 days. This man is a senior computational scientist with credentials in the pharma, life sciences, and trading tech market, and he is one sharp blade; I worked with him at FT R&D. He did not, ultimately get the job at Yahoo, but he had this to say (and I will wrap up why I think this is relevant to MS-Yahoo): read post  jump for his impressions Continue reading

Support the Yahoo! Buy the put or the call?

I dont know the difference between a put or a call – but I think you should support Yahoo in today’s trading. Why-hoo should you? Let me tell you:

As millions of Institutional Investors read my blog and seek my advice regarding tech sector investments, I have decided to comment with some unsolicited moral porridge, something that shall stick to the ribs of investors and not run off, as tech news is want to do.

Investors! Heed me! Hold off on the Yahoo call. Yahoo’s wise, though beardless founder, has made a decision that is in the best interest of the industry at large, in the long term.

Yahoo is being helmed back to its center; back to the days when lasting architectural foundations of internet systems were made to last and deliver value for more than one trading cycle, more than one quarter’s report.

The merger would have been a drawn out fiasco, and resulted in naught. The new fear of G-d that is Yahoo’s sweaty legacy of this non-deal, is that the preeminent engineers and smart y pants people that built the Yahoo legacy, are for a moment, back in the driver’s seat.

You, shareholder, may be currently dismayed. But what is being built under your arses is nothing short of a next generation platform for network computing and user centered, (social hate that word) networking. The type of cloud that Yahoo is moving to build and the services thereof will last much longer, nay shall endure, far better than the plethora of here and gone social me too crapola from the valley.

What the Yahoo! has done is tantamount to changing the plating of the Titanic’s deck, not the chairs – the turbines, not the band. The officer of the watch saw the iceberg in time, barely. The Andrea Dorea turned and narrowly scraped the Stockholm.

All Success, Cap’n Jerry, aye me boy, aye. All buy Yahoo on the down and show yer support for our stalwart Valley institutions.

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Newscorp Yahoo Deal makes Perfect Sense

Newscorp Yahoo Deal makes Perfect Sense

And, just breaking, a breathless call from a friend of mine that works at an investment bank’s office in the Pacific Northwest, Panting Randy: “…They’re out!”.

I was tired of all of his unattributed news and rumors, but I had a sneaking suspicion that he was on to something, so I wanted attribution. I said, “I’m putting your name on this, brother Randy”. He was intransigent, “oh no you don’t, I’ll get canned.”

Bastard. Stupid Randy, the third tier gopher for investment bank X (who, by the way,  is not retained by the principal parties), says that Microsoft is going to cool the deal, ostensibly due to the (un)anticipated exodus of key management from the Yahoo corporate body. Further, the brain drain encompasses noteworthy personnel that are, and he quotes, the twerp, “key to Yahoo’s long term re-engineering plans to better integrate the visible internet properties.”

Figure that one out. Who knew that Horowitz going to Google would be such a monkey wrench? It’s almost as if Microsoft wanted to just pull their chain and catalyze these layoffs with some added heat.

Now then, Newscorp:

It is a great idea for Newscorp to  bring in a little  money (well, a lot, actually), and combine the Myspace property in the deal. Who better to rework the ugly, fugly MySpace, than Yahoo?

Indeed, Yahoo has the technical expertise to extend and optimize every aspect of MySpace, from cosmetics to performance, and integration with a phantasmagoria of Zimbra email goodness. I’m all for it. The Newscorp deal fits a comfortable valuation, brings in a property with true synergy, and brings that Juggernaut of MySpace to a partner (Yahoo), that can actually do something with it.

They have my blessing.


Acquisition Pressures Accelerate the Pruning of Yahoo’s Purple People

Acquisition Pressures Accelerate the Pruning of Yahoo’s Purple People

I was sitting across the table from a survivor. A survivor. You would think that a person with almost eight years tenure in an exalted technical management capacity would be elated to be telling me his or her story, but this soul was about as glum as can be; there was a veritable cloud in the room.

This interview was conducted with the solemn pledge of anonymity, for obvious reasons. Indeed, this survivor of the Yahoo upheaval chose me because I am an unknown, no account, under the radar blogger. I am sure that, eventually, other interviews and exposes will appear with attribution in various on-line organs such as TechCrunch, Boomtown, or some such.

Such as it is, I am honored to be the anonymous nobody that this Yahoo survivor chose to vent through: Continue reading

I’m no Genius, I’m No Pundit

It’s interesting to note that all the bullet points mentioned in my Yahoo interview are being reiterated on KQED FM this morning “Forum discusses that question with a panel of experts including Michael Kanellos, editor-at-large for CNET; and Sarah Lacy, author and columnist for Business Week Magazine” – Dylan Sweeny is also a panelist.

What is the consensus:

  1. Yahoo never pulled its properties together into a coherent whole
  2. Yahoo never took full advantage of its Web 2.0 acquisitions
  3. Yahoo shied away from pursuing a more aggressive acquisition strategy when it counted
  4. Putting Semel at the helm steered Yahoo onto an ill-begotten road towards becoming a quasi entertainment portal
  5. Semel and Decker greatly expanded the upper level management of Veeps and do-nothing directors
  6. Semel continued (probably did not initiate, though) the slide from a  technology meritocracy, to an agency business model

So, they agree that there has been a bungling at Yahoo. Many callers also expressed that vehement “Purple Culture”, that is boiling over at the thought of serving a Microsoft Master.

Now, whoever pays your check gets your loyalty, but I am reminded of a quote from the interview I conducted that was intentionally omitted due to its Inflammatory tone:

“If the Redmond management clones think they are going to muscle us and change our user driven culture, I will do all in my power to thwart their efforts, short of insurrection”

Sounds like insurrection to me. Such different cultures, such divergent targets.

Yahoo Culture – What was, is, and Could Be

I am not a professional journalist. There are no ads on this blog, and I have a tiny readership. I use this blog to drive my consulting work in alternative channel marketing and product strategy. Therefore, I don’t have the kind of attributable and authoritative sources that other bloggers have on the inside of Yahoo.

What I do have is a small group of friends and professional acquaintances that are subject to all of the fear and loathing that career uncertainty brings. These folks are not VP’s or Directors, they are editors and community managers, product managers, and software engineers. I met most of them through my work at France Telecom (where I was a contract analyst for product strategy). FT opened doors for an ‘under the radar guy’, like myself. Lots of small Bay Area companies wanted to work with this EU telecom giant, but the only survivor of the internet’s halcyon days to visit the lab (while I was there) was Yahoo.

Anyhoo, when news of a round of anticipated layoffs started to surface, I wanted to collect some opinion from my small cadre of Yahoo contacts – not necessarily for a feature article on Yahoo buzz, but more for a perspective piece on the Valley’s work culture. I’m fairly certain that most folks in the techbiz are aware that prior to the Microsoft take over news, and long before the layoff news, there was a fairly rigorous re-organization taking place at Yahoo that coincided roughly with the departure of Terry Semel.

You may also recall the famous Peanut Butter letter by Brad Garlinghouse (a TechCrunch link here). The Garlinghouse manifesto was the early warning of an impending internal shakeup. Within my network of Yahoos, folks who perform the daily work at ye olde Purple Giant, all have been moved to new departments, placed under new managers, or have been bumped up or down a notch in perceived responsibilities. As a group, these salt-of-the-earth folks all received a small (though by no means symbolic) pay raise.

The following article is a smattering of paraphrased narratives collected with permission. As far as attribution, I was not able to secure the release of their identities, which is understandable in this climate of uncertainty. Perhaps, when the dust settles, said one, we can go on the record.

So, take these observations for what they are: thoughts and anxieties from the collective consciousness of Big Purple’s mid-level ranks, as paraphrased by an amateur blogger.

It’s a take on the culture of the valley we love and loathe so much: Continue reading