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The Cody Blog: December 2005

Friday, December 30, 2005

Finding Christmas Spirit

I'll write a bunch about this later -- it was so moving and wondrous...and heartbreaking -- but in the meantime, here are a couple pics of Christmas Eve at an orphanage in Juarez, Mexico. Only had my Treo phone camera, so the quality is lacking, but the spirit transcends.

That's me in the Santa outfit.

Beautiful little girl who wanted to wear my Santa cap.

These kids don't have running water. Or propane. If you want to help, email docjoc@zianet.com, and title the subject of the e-mail Juarez Orphanage Donations.


Thursday, December 22, 2005

A Very Merfia Christmas

Seeing America and Americana

I'm on the road this week and next. I'll be posting on occasion, but not every day.

Is that Christmas I see coming up around the corner?

Wednesday, December 21, 2005

The Hollywood Reporter Again...

Pretty cool --- it's the lead article today at TheHollywoodReporter.com:

Billion-dollar download: Google buys 5% of AOL
By Paul Bond

Time Warner officially confirmed Tuesday what everyone in the entertainment industry probably already knew: It will sell 5% of America Online to Google for $1 billion.The decision defies the unsolicited advice of shareholder Carl Icahn, who in his noisy proxy battle with TW directors warned against such a deal....

...This week, most analysts called the real value of AOL somewhere between $8 billion and $17 billion, though some said Wall Street will recognize in short order that a rejuvenated AOL partnered with Internet search leader Google is worth far more.

The $20 billion valuation "is fair or a little low," said Cody Willard, a hedge fund manager specializing in technology investments. "This is brilliant for both of them. It takes AOL out of the closed system they had painted themselves into since 1995 and makes them relevant again."

If AOL were to be spun off in as little as two years, it could be worth $30 billion, Willard predicted. "Not that I think Time Warner will go that route, but I also wouldn't put it past them."

On another note, I'm traveling most of this week. Looking to end up in Ruidoso, NM for Xmas. Fingers crossed.

Tuesday, December 20, 2005

I Say I Want a Revolution

Reprinted from part of my last day in the diary on RealMoney.com this year:

From a broader (and more important in the long term) level, I want to use this as my parting shot from the diary for 2005.

I spend a lot of time and energy trying to blow apart conventional wisdom. Doing so isn't just for entertainment purposes. Rather, I think one of the most important keys to getting things right on Wall Street (and in business in general) is to, first and foremost, question everything.

I very much want to question the "consumer is about to collapse" thesis. I question how much the Fed matters. I doubt that Sirius and Apple compete. I ask out loud about macroeconomic indicators and whether our bureaucratic measurement systems make any sense at all. I clearly rail against taking those systems and applying the concept of being "better than" or "worse than" polled expectations.

I question all of my own theses. Perhaps the explosion of new distribution channels is actually the best thing that ever happened to the content owners such as Warner Music Group.

I know I upset a lot of conventions when I write about these topics. Isn't that what we should be doing, though? Isn't the only way to be anything other than average to strive to be different from convention?

Think about the topics we're forced to digest every day on the Street, from Treasury rates to CPI to battery life and usability of the latest Palm Treo. Oooh, don't Apple's iPods scratch too easily? (Remember that one?)

The fact is that Wall Street and conventional wisdom spend way too much time looking at worthless inputs. Junk in, junk out, you know? So, yeah, let's question everything. Let's look for revolutions. That's what Apple and Google have done. They've revolutionized things. And it's not a coincidence that those two stocks have been just about the best-performing large caps on the planet.

And with that, I'm going to do very little writing starting later this week. That fin you see in the water is Rev Shark, and he'll be back tomorrow. Thanks for reading.

And seriously, question everything. Flip it, indeed.

Net long AAPL, GOOG; Net short WMG

Friday, December 16, 2005

NMF: Against Me!

I'm writing the trading diary on Realmoney.com yesterday, today, and Monday. Check it out if you have a subscription.

Let me just say this about Against Me!:

It's punk rock for the 21st century. Heavy grooves, screaming rants, and catchy melodies sung angrily.

I've played "Don't Lose Touch" 17 times this week. Just hit play on it again.

The whole album's pretty damn good too. But DLT is by far the standout jam.

Best song title: Unprotected Sex with Multiaple Partners

Who comes up with such a title?!

As Quoted in The Hollywood Reporter

Google turning up music with new integrated search options
By Paul Bond

Google is getting more in tune with online music lovers.

The world's No. 1 Internet search engine Thursday began its search music function, making it easier to seek bands, albums, songs and such without having to sift through information unrelated to music.For example, a user typing "Genesis" into Google's home search page will now get, above the main results, a photo of the progressive rock band and a hyperlink that reads "more music results for Genesis."Links to biblical information and NASA's Genesis space mission come lower on the page.

The "more music" hyperlink leads to Web pages containing a list of Genesis albums, song titles and reviews, with links to photos, news, fan sites and more about the band. Google also links to such sites as iTunes, RealNetworks and Amazon.com, where the music can be purchased.Google's new product also offers links to song lyrics, a service which some record labels have objected to of late.

Google, which is playing catch-up with MSN.com, Ask.com and Yahoo! in the music search game, says it doesn't intend on taking a cut of sales from the e-commerce sites it links to but instead will make money its usual way: by selling online ads.

"Right now, the music search feature mostly works for artists popular in the U.S. and a more limited number of artists from other countries," Google search quality product manager David Alpert wrote in a posting at Google. "But we plan to expand it to classical music, worldwide artists and lesser-known performers. Our list of music stores will also grow over time."Wall Street investors were bullish on the development, with Google shares Thursday climbing $3.57 to $422.53.

"Simply put, brilliant," said Cody Willard, a hedge fund manager specializing in technology investments. "Expect them to do the same for every other form of multimedia that ever gets invented."

Another Failure by Our Govt to Do the One Thing They're Actually Supposed to Do

How outrageous is this:

Appellate court tosses out murder conviction
Judge failed to properly instruct the jury.

...She said that instructing a jury about the presumption of innocence and the burden of proof is basic to every criminal trial.
"We argue about a lot of things but that's not one of them," she said. "It's so automatic that it looks like it was missed. All of the parties thought it had been done but it doesn't appear anywhere in the trial record."

What an incredibly incompetent judge and prosecutor! And what an incredible waste of our tax dollars! We don't ask the government to do much (well, I don't, anyway), but I do ask them to run a court system in a somewhat baseline competency level.

Fire everyone involved with this case. Now! No excuses for this.

Thursday, December 15, 2005

Chewbacca Serenades

Okay, it wasn't ten minutes after I posted that anti-Christmas jingle rant that I get a link to this:


So, okay, now I have to come back and change my mind. In some rare instances, such as when Chewbacca sings, Christmas carols can be rock and roll.

Christmas Rocks, but It Ain't No Rock and Roll

I love Xmas and all that jazz. But I think it's time I come to terms with the fact that I hate Christmas music.

Here I am jamming out to an alternative music channel. Just had the Oasis "Lyla" song blasting. Then comes Phantom Planet with "Winter Wonderland ".

I mean, I hate Christmas music ever since my parents used to make us sing carols on our way out to the woods to cut down our tree (fond memories of doing so notwithstanding). But why would any rockstar ever sing Christmas songs?

If and when I become a rock star -- ain't no way I'm gonna' ever put out a stupid Christmas song album.

Wednesday, December 14, 2005

Love and Hate for Adobe

Our tiny little farm house in San Patricio, NM is hard-core adobe.

I remember reading as a kid that adobe homes would naturally keep cool in the summer and warm in the winter, and I was fascinated by that idea. From my own unscientific, anecdotal tests as a kid, I think the temperature steadiness theory is true. And I love adobe for being so naturally utilitarian.

But, man, do I hate Adobe's software. I've never gotten why everybody pretends to love the .pdf format. It sucks. It's hard to navigate, search, use. And even on this new laptop, it takes like 10 seconds to open, as it lists the 83,203 patents that protect the software. And that's about 9 seconds too long.

And it used to freeze my other PC all the time because Adobe kept asking me everytime I tried to open it if I wanted to update it with downloads. How about leaving me alone once I purchased it? Leave me alone and do your damn job.

I guess I should be glad they don't put that annoyingly revolving Yahoo! ad button up at the top right of it anymore. Anyway, I hate Adobe.

The only worse software I can think of? Realnetworks and their obsession with taking over all your multi-media applications. Hate 'em even worse.

Two more hours to home after this 13 hour day in Boston. Sigh.

The Best of Tech: This Year's Five Best Christmas Gifts

Check out my column on TheStreet.com's free site today. I review my five favorite gadgets for the holiday season. Merry Xmas and all that.

Tuesday, December 13, 2005

From My Emotional Abyss

A younger friend of mine ping'd me today saying he was an emotional wreck. I told him after the roller coaster year I've had, with relationships great and horrid, stock swings bull and bear, and not a day off in 3.21 years (I did the math), that an emotional wreck would be a step up.

From my emotional abyss.

Hmm, that also sounds like a 1990s, disillusioned, grunge update to the Rolling Stones' great song of a similar name, no?

Quoted in the Wall Street Journal's Heard on the Street

Check me out in today's "Heard on the Street" section on the front page of the C-section (as in Cody-section?) of the WSJ today.

Pretty jazzed.

Monday, December 12, 2005

Learning and Learning at Seton Hall

Scott Rothbort, who teaches at Seton Hall (and manages money), invited Steve Birenberg and me out to guest lecture at his class on Tuesday of last week. It was my second time to drop in.

I was blown away by some of the students and the learning going on at Seton Hall, but first a quick story of how I once again found the experience wonderfully full of perspective (I wish I could just write that as "wondefully perspectiveful", but that latter word doesn't really exist, and I can't continually keep making up new rules to add to the English language, right?)

Seton Hall is in Orange, NJ, and our driver got lost as we entered the town. Now Orange, NJ, isn't all one big beautiful campus town, and we ended up in a some pretty depressing-looking neighborhoods, as we drove around looking for the campus. I had the driver pull over when we saw a couple people walking down the street, and I rolled down the window. I hollared out at them, "Excuse me, do you guys know where the Seton Hall campus is?"

They sorta' looked shocked at me and then at each other, and, as they told us they had no idea, I realized that here I was in the ghetto, asking for directions from the backseat a black limo-looking cadillac with New York plates.

Over the years, I've lived in the ghettos of Albuquerque, Harlem and Brooklyn, and I just sorta' feel comfortable in such areas. I've hooped, dunked, talked trash, and been in fights on the basketball courts in depressed neighborhoods countless times. I'm still that guy. But I guess it must have been somewhat shocking to the guys on the sidewalk in this circumstance. All right, so much for this digression. Onto the story.

We eventually found our way to the campus using some OnStar, and much like last time, I was smitten with the aura / atmosphere / vibe of the Seton Hall campus. It's a place of learning, and you can almost feel the brains turning, churning and burning.

Steve gave a great presentation to the class, and I along with several students and Scott peppered Steve with questions. I learned a lot from the presentation -- and from the questions the students asked too. Which is really the point of this post.

My favorite question of the night came after Scott asked Steve and I for some stock ideas. Whatever stocks we mentioned are beside the point when it comes to learning. No, it was when a student asked "How do you determine when you sell or trim a position?" that I got really excited.

I lit up when he asked that. Mainly because that's a hard-core, cutting, nitty-gritty aspect of investing and trading. Again, our answers were beside the point.

It's the process, the understanding of the business, the grasping of the concepts that were so important that night. It's the question that's important!

For an undergrad student to be able to see that many steps ahead in this chess-game we call the market is a sure indication that there are some very important lessons being taught at Seton Hall and in Scott's class.

Very impressive. Like I told Scott and Steve at dinner afterward -- I can't imagine having built such a base knowledge of the world of Wall Street and trading and investing as an undergrad.

Some Flip It Advice for the Dems

I love this little tidbit from The Economist last week in a n article called, "Lexington, A heretical proposal":

Roe v Wade has proved a lightning rod for conservatives; and many moderates dislike the Democrats' Roe-driven defence of partial-birth abortions. So consider a heretical proposition: why on earth don't Democrats disown Roe?

No way that'll happen, of course. But this speaks to my whole theory of a the breaking apart of the two-size fits all political party system. Eventually, it will be individuals running for office --- not parties.

Hasta la vista, Dems and Repubs! The end is nigh.

Democracy, indeed!

A Reader's Bangin' Blog

Dunno if the rest of you's (hey, I lived in Brooklyn for a couple years, I'm allowed!) clicked through the comment section of the NMF post below, but as a fellow reader pointed out to me --- well, just check out Melissa's blog, "The Daily Minute".

It's, uh, hmmm, I'd describe it as "hot" among other adjectives.

Just sayin'.

And, no -- I don't know her or anything about her, except that she posted that comment on the NMF post below. Maybe I should try to get to know her though, eh?! ;)

Friday, December 09, 2005

NMF: Two New Rockin' Jams

Today's NMF features two relatively newer songs, though I really don't think they would be considered 'undiscovered". Each of these two have been the most popular songs in my rotation in the last couple weeks or so.

The first is "Bom Bom Bom" by Living Things. I bought the whole album off iTunes, but I haven't jammed to it yet. Let you know if it's any good later.

The second is "King Without a Crown" by Matisyahu (see his website here at Matismusic.com). I also haven't rocked out to the whole album yet, but I can vouch that this single rocks, man.

PS. Don't bother with Neil Diamond's latest. This over hyped, stripped down collaboration with Rick Rubin has to be most soul-less album of Diamond's amazing career. He's without a doubt one of my top 10 favorite artists and song writers of all time. But there's not even a decent track on this album.

PPS. Neil Young's latest is another great one. Talk about consistent.

PPPS. My friend Matt Mastrangelo from Rolling Stone just hooked me up with some DMB tickets for Saturday night. I loved DMB from the first time I heard him back in like 1993 or so, but have never seen him live. Very excited.

Rock on, good people of planet Earth.

No Asylum for My Soul

NMF coming up, but as I'm writing a column for Realmoney.com, Soul Asylum's Black Gold just hit my speakers. I've always loved this line:

"I've got so much left to do with my life!"

Gonna use that as my next slogan at the top.

Rock on (and come back later for New Music Friday!)

My Mom Taking Off from White Sands

As Wall St's getting big wind of NM's and Virgin's spaceport plans, you guys have no idea how connected I am to the whole idea of outer space. After all, I was born in Roswell, NM, almost exactly on the 25th anniversary of the crash. And I have spent lifetimes out at the White Sands. Here's my favorite picture from WS:

How cool is that picture? And how great is my mom for sledding down the sand dunes on her 60th birthday earlier this year?

Thursday, December 08, 2005

What Constitutes "Spam"?

I just got this notice from one of the companies I write for:

The Network Services team will be migrating the current SPAM service to a new system. The new system will be hosted by an outside provider that will scan all incoming e-mails for viruses, spam & prevent denial of service attacks on our e-mail systems.

The new system will send a notification to you in the event you have any e-mails that have been captured as spam.

Attached is the user guide for using the Spam Manager.

Note my italicized part. Who in the hell designed a system in which you flag a spam and then send a notice that you did so. Isn't the whole idea to keep me from having to deal with an email that's meaningless?

I mean, I'll delete the update, just as quickly as I'd delete the spam itself, for crying out loud!

Still, I'm gonna be an anti-spam activist forever, and continue to push the government to actually do one of the jobs we pay them to do!

Tuesday, December 06, 2005

The Eye of the Tiger, or, A "Real" Athlete to Look up To

Oh, man, I truly fell outta' my chair laughing on this one. Tell me you haven't thought about doing such things.


It reminds me of when I played hoops for the UNM Lobos, and we'd go on national TV and my buddy, Casey Kearns, would always tell me, "Cody, this time, when the camera comes on you, jump up and down, rub your tummy and pat your head and yodel!".

I never did, but I still picture doing such silly things any time I go on live TV, and it helps me to chill out. Someday I'll tell you one of my favorite such fantasies.

Monday, December 05, 2005

Money Management for Hipsters

I should be clear up front here: my writings here are going to be completely unconventional and are not what 99% of Wall Street folk will tell you. I tend to think that 99% of Wall Street is wrong about most things, but that’s a different topic. In my day job, I don’t sit around giving advice to people about how much to save and how much to allocate to various assets. I spend all day, every day trying to find the best stocks to own in my fund to make my partners and me as much money as possible.

The thing with all of these examples is this --- people under the age of 30 (or in some cases 40) should worry more about playing and having fun and taking risks with their money than about saving and investing for their retirement. Each of the examples below are about young people who have their whole professional lives in front of them. If each is successful in his/her career, they’re going to make a whole lot more money in the next 30, 40, 50 years than they’ll ever really need. See below for more details. And again, to be clear, what I’m saying here would be considered sacrilege among most Wall Streeters --- but maybe they’re all praying to a false idol anyway.

1 - A 22 yr.old conde nast editorial assistant on a $25,000/yr salary.

I relate to this one. My first job on Wall Street, back in 1996, came with a $22,000/year salary that I negotiated up to $24,000. I lived in Harlem at the time in an 600 sq ft apartment with a mattress on the floor. I took the advice of my bosses and set aside a tiny fraction of my salary for a 401(k). Over the next few months, I scraped by, barely able to make ends meet in this city -- but I had whopping $2,000 put away in that 401(k) after my first year on the job. I then became a partner in the firm and my next check was for more than my entire first year’s salary. Though I quit that job and walked away from all that money the very next month, I never was able to figure out why I bothered saving money when I couldn’t even afford a burger from the diner most nights. I took the penalties and paid the taxes when I cashed my 401(k) out a few years later. I wouldn’t worry one iota about saving a dime if were this person.

2 - A young rock band that just received a $100,000 signing bonus from arecord label. and“Rock” band.

This one’s easy --- live like the damn rock star you want to be. Push it hard, take all the risks, put it on the line, and have as much fun as you possibly can. You’re living 90% of American’s dreams.

3 - A hip hollywood starlet who just got half amillion to star in the new Louis Vuitton ad campaign.

So she’s already making good money. She needs to worry first and foremost about staying hip. Then she needs to ask every single one of her trusted friends if they have a trust-worthy money manager whom she can talk to. And then she should sit down and put together a strategy that will likely entail some of what most of Wall Street would tell all of these examples to do --- some bonds, some real estate, some mutual funds. She should probably stay away from investing in common stock and leave that to the professionals who spend 70 hours a week for years on end trying to figure out the right stocks to buy – you know, people like me! As a matter of fact, some of the partners in my fund are indeed Hollywood stars.

4 - 18 year old Russian model just landed 2 mil lingerie contract. She has working visa through her model agency. Should she get an investor's visa first before consider investing? What she should do with all the money?

I think I dated her once ;). She should take a million bucks and put it in some sort of bond portfolio that will crank out 10% interest per year. And whatever’s left after taxes? Spend it on or invest in whatever she likes. This way she’ll have her cake and eat it too. $1 million at 10% per year will appreciate into a nice nest egg over time and she’ll still have the opportunity to enjoy the “good” life while she’s young.

5 - I have credit card debt. does it make more sense topay down that debt, or to use that money to invest?

Pay down the debt. No reason for anyone who has sustainable credit card debt to bother looking to invest. Get out of credit card debt – then worry about any surplus.- i'm a freelancer without a 401(k). but i also wantto make sure i don't have to be a 70-year-oldprostitute. what do i get - an annuity? IRA? CD orjust savings? What, pray tell, is wrong with being a 70 year old prostitute? That said, if you don’t want to be one, then you should focus on building your career and making as much money as you can along the way. When you’re making enough cash flow to actually save a decent amount of money, then you should probably open some sort of retirement account. An IRA is probably the best bet for you, but again, you should ask all your friends until you find a money manager you trust who can set up some specifics for you.

Friday, December 02, 2005

NMF: The Mars Volta

It's Friday, and I'm in town, so that means another edition of The Cody Blog's New Music Friday.

A couple years ago, Mars Volta's agent sent me some of their music to check out. I'd probably like the band anyway, just because they hail from my hood, El Paso, TX, which, 130 miles away, is the closest airport to my hometown, Ruidoso, NM.

Roots regardless, this is simply one of the most progressive, mind-bending bands on the planet today. They pull in all kinds of influences, from acid jazz to hard rock to poetry reading in their music --- and they create sounds seemingly uniquely un-influenced.

Start at the beginning with their EP "De-Loused in the Comatorium". Hear the high notes weave into the syncopated beat, countered by distinct rhythm, all grounded with a little disonance. Then listen to the band mature with a slightly more mellow and sensible sound in the ever-trippy "Frances the Mute".

Sit back, relax, grab some wine and let the music meander around your mind, seep into your subconscience, erect its structures on your empty planes, and expand your horizons. I'm tellin' ya -- this is some deep sh*t, man.

Thursday, December 01, 2005

And You Thought Your Job Sucked

My friend (and superbroker) Rob Fraim highlighted this one for me today.

In a recent article in Popular Science Magazine entitled “10 Worst Jobs in Science” the following were included:

Harvard researchers in Borneo who catch orangutan urine (in plastic sheets, the way firefighters catch jumpers) for studying reproduction-hormone levels

Gear-packing monitors who run toward (not away from) the gases and molten rock of erupting volcanoes (dozens have been killed or wounded);

U.S. Geological Survey workers at two picturesque California lakes monitoring "extremophile" microbes that thrive in the most putrid environments (work that one says resembles being surrounded by 100 "extremely flatulent people");

“Human lab rats" such as students employed in an industry-funded University of California at San Diego study for $15 an hour to have pesticides sprayed into their eyes.