December 30, 2006

My Bare Lady: When Porn Stars Do Shakespeare - Kirsten Price, Nautica Thorn, Sasha Knox, Chanel St. James

posted by MR WAVETHEORY at 12/30/2006 08:06:00 PM
Sasha Knox: Shakespeare can't be that hard.

You know that Fox Reality TV has hit a new low when they hire porn stars to be part of the show. My Bare Lady is a new show on Fox Reality where four American adult film stars are sent to London’s most prestigious theatrical school to prove they can really act. The show claims a virgin cast, with a naughty past. The show's stars are Kirsten Price, Nautica Thorn, Sasha Knox, and Chanel St. James all of whom are veterans of the porn business.

The most interesting part of the show are of course the characters. After all, they're pr0n stars.

Kirsten Price: Married. Bi-bi
Kirsten Price, 25, is originally from Massachusetts and travels with pink luggage. According to her MySpace profile , she is married and bi . Ok, so she's no longer eligible. Note to self - cross her off my "women I'd like to date" list.
Nautica Thorn: Got back
Nautica Thorn, 22, from Hawaii, has the most exotic look - half Japanese, a quarter Hawaiian and a quarter Puerto Rican. Nautica says, "I'm a "dirty" mutt, hehe." She is a real early bloomer according to her myspace profile, "I have always enjoyed sex since an early age. I first kissed a boy at age twelve, first gave oral sex to a boy at age thirteen and lost my virginity at fourteen." Thanks for sharing! Like I needed to know that.

Chanel St. James: Faster is better.
Chanel St. James, 34, is from Arizona and has the most attention-getting breasts. Chanel's MySpace profile says she likes "Life in the fast lane - fast cars, fast men, and really hard fast sex!" I would add fast money to the list, because that's what she's going to get very soon.

Sasha Knox, 22, from California, stands out because of her fresh, natural look. But she’s definitely one of the girls. Her myspace profile just says she doesn't want to have kids. If I were married to her, I probably wouldn't want her to have kids either!

What these girls have in looks, they lack in brains. The best part of the pilot is when the girls are asked to do "Romeo and Juliet". One girl had never heard of it, another thought it was written by a woman while another simply shrugs, "Reading books is very time-consuming."

My conclusion: These girls would have done Shakespeare - the dirty old man - but they just can't do "Shakespeare" - uh huh, you know what I mean.

Reality has hit a new low when the curtain goes up and someone’s going down. Thanks to Google Video, you can even see some of the naughty audition clips from My Bare Lady where the ladies deliver their best orgasm and give their best lapdance.

My Bare Lady Orgasm

The My Bare Lady Lap Dance

The New York Times give it up for the ladies for trying to leave their pr0no past for the mainstream acting business. All I'm sure of is that if they can't act, they sure can talk. Sasha Knox porn veteran of such classic titles as "Down the Hatch #19 and Gang Bang Auditions #20 quipped after a full day of shooting, "this is great, I'm really sore, there's no way Shakespeare can be harder than what we usually get up to in these movies".


MyBare Lady Home Page
Kirsten Price MySpace Profile
Nautica Thorn MySpace Profile
Sasha Knox MySpace Profile
Chanel St. James MySpace Profile

New Years! Picking Up Tickets for the Lottery and Loteria Nacional

posted by MR WAVETHEORY at 12/30/2006 03:03:00 AM
It's New Years and people around the world are buying lottery tickets hoping to get lucky for the New Year. Personally, the odds of winning the lottery, any lotter for that matter, are so low that I personally don't think it's a rational thing to do. Even lower than the chances of starting a start up! Or making a successful venture capital bet! But hey, it's New Years! Out with the rational, in with the irrational!

So, I dug into it. It looks like people in Turkey are getting crazy about the lottery which has a grand prize of YTL 20 million ($13.5 million). In Turkey, the jack of 13 of the last 20 New Years lotteries have been shared by 4 people. But buyer beware because lots of hustlers are out printing fake lottery tickets.

Lottery Buyers in Connecticut on the other hand were out of luck. AT&T (NYSE T) was to blame. The phone lines connecting the machines didn't work! Personally, I think they really should try to at least spend some money on that old decrepit phone network. Jackpot: $88 million.

Question: What would you do if you won the lottery?
Most common answer: I don't know. Most people seem content paying for their kids education, buying a car, or paying down the mortgage.

An actual winner's answer: Quit my job, and travel around the world. That's what Mark Fielden did when he won 1 million pounds eight years ago. Now 55, Mark spends his time looking after hens, geese, cockatiels, doves and two dogs. Sounds boring huh? Yeah, maybe he would have had a more exciting life if he hadn't won!

Santa Tracker : Track Santa's Christmas Delivery in Real Time

posted by MR WAVETHEORY at 12/30/2006 02:41:00 AM
Christmas may be over and you may have already gotten your presents but it's not too late to download Santa Tracker which tracks Santa's Christmas toy delivery in real time. You can see where Santa dropped off all his gifts to boys and girls who were naughty and nice.

Google Santa Tracker is a cool plug in to Google Earth that the Google guys (Nasdaq GOOG) put together. You can check out the toys that Santa hid in different parts of the world.

Download Santa Tracker and Toy Hunt

Norad Santa Tracker also tracks Santa. It's a cool Java app which shows where Santa has been in the last couple of days. It's available in English, French, Spanish, Italian, German, and Japanese.

Check out Norad Santa Tracker

Nasa also put together a satellite Santa Tracker. It looks like it may be turned off.

Check out Nasa Santa Tracker.

For a comprehensive coverage of Santa's 2006 Journey, go to MSNBC.

December 29, 2006

RIAA Wants a cool $1.65 Trillion from AllOfMP3

posted by MR WAVETHEORY at 12/29/2006 02:45:00 AM
Wow. $1.65 trillion. You have to love the RIAA for knowing how to pick the numbers. $1.65 trillion is slightly less than the GDP of the UK and 1000 times more than what Google (Nasdaq GOOG) paid for YouTube.

The RIAA came up with the number by seeking $150,000 for each of the 11 million tracks offered by The suit seeks damages in New York against the owner of which is a company called MediaServies.

Meanwhile, AllOfMP3 responded on their blog that they don't operate in New York and don't intend to show up. "Certainly the labels are free to file any suit they wish, despite knowing full well that AllofMP3 operates legally in Russia. In the mean time, AllofMP3 plans to continue to operate legally and comply with all Russian laws."

The whole splat has some pretty big implications for the music industry because the big grand daddy of the industry of course is iTunes, which is owned by Apple Computer Inc (Nasdaq AAPL) and sells songs for $1 each. Apple has everything to gain from winning the suit and everything to lose if the RIAA loses because AllofMp3 sells entire albums for under $1! Talk about a killer business model!

You have to wonder who's behind the splat. I smell a conspiracy.

December 28, 2006

Katie Rees : Sex Scandal Photos of Miss Dethroned Nevada USA

posted by MR WAVETHEORY at 12/28/2006 09:33:00 PM
Katie Rees is making waves because the 22 year old Miss Nevada USA was dethroned from the Miss USA pageant for posing in a variety of very suggestive positions, in a "Girls Gone Wild" type of style, when she was 19 years old - she claims they were taken when she was 17. According to the trusty source that is Wiki, the Katie Rees sex scandal photos show her "semi-naked, kissing, sucking the nipples of other women, and simulating cunnilingus at a Florida nightclub three years prior."

You have to love the internet for making these photos widely available. Credit must go to for putting them online. Katie Rees is just another generation Y, Web 2.0 girl. She was just messing around. Check out the Katie Rees photos. What's so wrong for Miss USA to have a wild side?

Anyway, bad things have a strange way of turning out for the better. The scandal is probably the best thing that happened to her. After all, who had ever hear of Katie Rees before the scandal? I'm sure now she will pose for PlayBoy, Maxim, and Stuff, become totally famous, and sign on a whole bunch of endorsements, and oh, by the way, make tons of money. You have to love the media, America, and tabloids for their infatuation with sex scandals.

For the not so safe for work photos, check out the Katie Rees photos here and here.

Word of advice, make sure the wife or the kids or the boss is not around. Well, the boss probably isn't around this week so scrap the last bit.

Washingtonienne - The Sexy, Lurid Steamy Online Diary of a Washington Aid

posted by MR WAVETHEORY at 12/28/2006 07:15:00 AM
If you're working today, then you are probably one of the few people stuck at work today. That means you are bored out of your mind. Don't worry. Here's a something waveless and entertaining to do: read the sexy, lurid steamy online diary of a Congressional staffer.

Jessica Cutler was just another 28 year old aid on Capitol Hill until she started writing about her adventurous sex life in her blog Washingtonienne. Cutler spared no detail in her blog about her office sex scandal and bragged about how she was doing it with 6 guys, including X who pays her for sex. You have to love this exposee because it is written in a "Sex in the City" style.

Friday, May 14, 2004

I got a raise today! Now I make $25K.

(Wasn't that what I was making before??)

Most of my living expenses are thankfully subsidized by a few generous older gentlemen. I'm sure I am not the only one who makes money on the side this way: how can anybody live on $25K/year??

If you investigated every Staff Ass on the Hill, I am sure you would find out some freaky shit. No way can anybody live on such a low salary. I am convinced that the Congressional offices are full of dealers and hos.

posted by The Washingtonienne at 4:34 PM

She even created codenames for each of the guys.

By popular demand, I have finally created a key to keeping my sex life

In alpha order:

FD=The intern in my office whom I want to fuck.

X=Married man who pays me for sex. Chief of Staff at one of the gov
agencies, appointed by Bush.

T=Lost my virginity to him and fell in love. Dude who has been driving me
crazy since 1999. Lives in Springfield, IL. Flies halfway across the country to
fuck me, then I don't hear from him for weeks.

HK=Dude from the Senate office I interned in Jan. thru Feb. Hired me as an
intern. Broke up my relationship w/ QV (see below).

QV=Serious, long-term boyfriend whom I lived with since 2001. Disastrous
break up in March, but still seeing each other.

P=AKA "Threesome Dude." Somebody I would rather forget about.

YZ=My new office bf with whom I am embroiled in an office sex scandal. The
current favorite.

K=A sugar daddy who wants nothing but anal. Keep trying to end it with him,
but the money is too good.

Shit. I'm fucking six guys. Ewww.

Jessica's blog was deleted recently, because she got sued by an ex-lover, Robert Steinbuch, whom she codenamed "YZ" in her blog ... "YZ=My new office bf with whom I am embroiled in an office sex scandal. The current favorite." YZ is apparently now a professor at the University of Arkansas. You can read Jessica's blog here. Or read the book, The Washingtonienne: A Novel. Just when you think that all the exciting stuff happens on Sand Hill road, you find out that there is an even more fascinating world in Washington!

Also: The Washingtonienne: A Novel- nice cover!

Chocolateholic - How A Private Equity Artist Saved a Bundle Breaking Up a Godiva Gift Basket

posted by MR WAVETHEORY at 12/28/2006 03:26:00 AM
I was doing some post Christmas shopping and deal-hunting today at the mall and came upon a classic private equity deal at Godiva. Godiva, the upscale chocolatier, was having its usual post-Christmas sale with 40-50% off most items, and I crossed paths with my break up target: The Godiva Gift Basket, codenamed Golden Abundance.

The Godiva Gift Basket usually goes for $125, but since it was 50% off, it was going for $62.50 per basket. That got me excited - in a private equity sort of way. The gift basket came with 6 items and I did a quick sum of the parts valuation for it based on the list price of the items (normal price) and the sale price:

Item List Price Sale Price
Nut and Caramel Assortment 19 19
Large All Milk Chocolate Assortment 29 29
18pc Truffle Assortment 33 33
Milk Chocolate Cocoa Box 5 5
8 pc Ballotin 14 8.4
Solid Dark Chocolate Bar 3 3
Sum of the Parts
$ 103.00 $ 97.40

Some interesting findings.

Godiva charges $22 extra for the same items in the Holiday gift basket. The sum of the parts valuation of the Godiva gift basket is $103. Normally, Godiva charges $125 for it! If you put together a comparable Godiva gift basket by buying the individual pieces, you save $22.

Godiva discounted only the Christmas Ballotin boxes post-Christmas because they are seasonal items. The Ballotin boxes are the golden boxes of chocolate that Godiva is famous for. Godiva did not discount the truffles or the milk chocolate cocoa box or the chocolate bars, because these are not seasonal items. As a result, if you bought the items separately (even with the 40% discount for ballotins), you would have paid $97.40 which would have saved you $5.60.

The 50% discount on the Godiva gift basket is an anomaly that shouldn't occur in efficient markets. The Godiva gift basket fails the test of the no-arbitrage condition of the efficient market theory. The 50% discount on the Godiva gift basket is a great deal because it costs $62.50, when in fact, it would cost a shopper $97.40 to put together a comparable chocolate basket by buying the pieces separately.

So, given these facts, let me test your private equity IQ. If Godiva chocolate boxes were completely fungible and tradeable with the Godiva gift basket, what would you do to earn some riskless profits?Furthermore, what is the profit per basket under this arbitrage? Think about this for a moment and then read my answer.

Answer: An entrepreneuring private equity buyout artist would buy all the Godiva gift baskets in the store for $62.50 and break them up and return each box of chocolate to the store. He would sell the pieces separately back to the store and earn $97.40 making a riskless profit of $34.90 or a 55% return on invested capital.

On the other hand, if our private equity artist were a very generous person, he would take those baskets and break them up and give each box away separately as gifts, thereby saving himself a cool 35%, if he were to buy the items separately.

Back to Me and My Godiva
Needless to say, I picked up a few of these baskets from Godiva. They were quite a steal. I bought them mainly because each of the gift baskets came with a box of Assorted Truffles which costs $33 if you buy it separately. If I weren't such a fan of Truffles, I would have gone with the 2lb 13oz Gold Ballotin which comes with 105 pieces - going for $52.50. It's literally a chocolate shoe box.

All this blogging and sum of the parts valuation is making me hungry. I think I'm going to have one of those chocolate truffles now. Go get your own Godiva gift basket.

Watch John Edwards YouTube Video - Tomorrow Becomes Today

posted by MR WAVETHEORY at 12/28/2006 12:21:00 AM
John Edwards has declared his presidential run on YouTube in a video called "Tomorrow Becomes Today." The filming was done by none other than Rocketboom founder Andrew Baron. You can watch the John Edwards video below.

Google Invests in Xunlei. Will Lightning Strike Twice?

posted by MR WAVETHEORY at 12/28/2006 12:07:00 AM
Google (Nasdaq GOOG) has invested $5 million in Shenzhen Xunlei Network Technology Ltd., a Chinese Web site that helps users download videos from the Internet. Xunlei ("迅雷") means lightning search in Chinese (via and via). According to China Web 2.0, The investment announcement is expected to take place on January 5. Google China would invest $5 million and Ceyuan Venture would invest $15 million. The company was founded in Silicon Valley in 2002 and moved to Shenzhen in 2003 by two Valley entrepreneurs ("邹胜龙" and "程浩").

Xunlei was created in 2003 and is known for being a download accelerator for videos and software. Fortune China ranked Xunlei as one of the coolest companies of 2005. IDGVC invested $1 million into Xunlei and then a second round $10 million funding was invested into the company by Morningside and IDGVC. Xunlei’s software was downloaded over 110 million times and averages about 1.5 million downloads per day.

Some of Xunlei’s currently advertising customers are Dell, KFC, Lenovo, Motorola, Nokia, and Olay.

Existing investors in Xunlei include IDG Venture Capital and Morningside Asia Advisory Ltd. The Chinese Web site also has partnership agreements with companies such as Motorola Inc., Sina Corp. and Shanda Interactive Entertainment Ltd., according to its Web site.

Update: As some of the guys and gals on Sandhill road might know, Google also invested $5 million in, Inc. (ADR) (Nasdaq BIDU) at a $100 million valuation during the pre-IPO / mezzainine round. Google unloaded its stake in Baidu for a cool 10x return - $60 million. So, if history tells us anything about the future, Xunlei could be a nice 10 bagger for the VCs and for the big G.

December 27, 2006

Empire Online Exits Online Poker Business: What's Next?

posted by MR WAVETHEORY at 12/27/2006 11:36:00 PM
This year was a tough one for the online gambling industry. I wrote earlier about how the hammer came down on the industry when Congress passed a law to ban online gambling. Now, Empire Online (EOL.L), one of the biggest marketers in online gambling, has exited the online poker business. It just sold its online assets to PartyGaming PLC (PRTY.L) for $30-40 million.

Empire Online was basically in the business of finding customers for the big online gambling sits. It partnered with and whitelabeled's software and skinned its own sites. Think of it as the online version of the offline casino hosts who bring business to casinos.

That business of course got eviscerated when the Feds busted SportingBet and then passed the internet gambling ban.

Regardless of the setback, Empire Online's founder made a lot of dough. He took the company public just at the right time in the middle of 2005 and then the stock traded as high as 300 pence on the London Stock Exchange. Today, Empire Online is worth 44 pence - good for an 80% wipeout.

What is interesting is that the company's founder Noam Lanir built quite an incredible balance sheet for Empire Online. While poker was hot, it received a payment of 250 million pounds from PartyPoker. Add that to the 15 million pounds it will receive from PartyGaming for divesting its online assets and you have a balance sheet with close to 265 million pounds of cash. (Detail: The mid year results of Empire Poker show that it had 262 million pounds of cash, so it will have closer to 277 million pounds at year's end.) That is not bad for a company with a market value of 128 million pounds. Essentially, the stock is trading at a 50% discount to cash. Apparently, the founder, Noam Lanir, knows this real well and has decided to shift his company into the investment business.

All aboard! Empire Online is the ultimate Christmas holiday sale!

IPO Fever Hits Africa: Stanbic Uganda

posted by MR WAVETHEORY at 12/27/2006 10:31:00 PM
I just came across an interesting article on how investors in Africa have caught IPO fever. Stanbic Uganda, the largest bank in Uganda, recently completed its initial public offering and it attracted a large amount of foreign interest from investors in Kenya - the newspapers are saying that more punters, aka speculators, from Kenya bought the IPO, than actual Ugandans.

The IPO was priced at Shs70 ($0.04). That's right $.04. The bank sold 1 billion shares and the deal closed right before the Christmas holiday on December 22nd. Before the Internet, Stanbic started out as a bank that ferried cash around its banks using taxis. Nice huh?

Stanbic Bank in Nairobi.

The operational risks were immense. Cash had to be moved by staff throughout the country by any mode of transport including taxis; reconciliations were done manually and frauds were frequent.

The IT strategy did wonders. Within a short period, all branches were converted to the Bankmaster software, which made it possible to network all branches. Its ATMs were rolled out in a massive way, making Stanbic the first bank to introduce ATMs in the rural areas.

Uganda has a relatively small banking sector comprised of 15 commercial banks, two development banks, over 80 forex bureaus, six credit institutions and 100 microfinance institutions.

Stanbic Uganda is a subsidiary of Standard Bank Group of South Africa - Africa's largest banking group with operations in 17 countries outside South Africa. The Group is also represented in 22 countries outside Africa.

The group's relationship with Uganda started in 1992 when Stanbic Bank Group, through Stanbic Africa Holdings, acquired the Grindlays Africa network.

Stanbic Bank Uganda was 51 per cent owned by Grindlays. In 1996, the government of Uganda sold its 49 per cent shareholding in the company to Stanbic Africa Holdings Ltd.

Total loans and advances are $694 million, while total customer deposits are at $1.141 billion and total banking assets $1.79 billion.

How to Buy Shares?
The Ugandan stock exchange has 9 stocks listed if you count Stanbic Uganda. You can see it is not particularly active or liquid. In fact, the stock exchange trades 2 times each week from 10 am - 12 pm on Tuesdays and Thursdays.

19 December, 2006 Bank of Baroda Uganda Ltd 0 0 Ushs. 1,000

19 December, 2006 British American Tobacco Uganda Ltd 0 0 Ushs. 470

19 December, 2006 DFCU Limited 3 1,692,062 Ushs. 420

19,December, 2006 East African Breweries Limited 0 0 Ushs. 3,679

19, December, 2006 Jubilee Holdings Limited 0 0 Ushs. 9,001

19 December, 2006 Kenya Airways 0 0 Ushs. 3,000

19 December, 2006 New Vision Printing & Publishing Company Ltd 0 0 Ushs. 435(ex)

19 December, 2006 Uganda Clays Limited 2 750 Ushs. 2,300

The broker managing the IPO is MBEA. (Details of the deal.) Shares start trading on January 15, 2007.

How I Increased My AdSense Click Thru Rate By 30%

posted by MR WAVETHEORY at 12/27/2006 04:40:00 AM
Since I started blogging, I have learned that improving the conversion rate of my AdSense ads can make a big difference to my income from blogging. If you blog for a living, then you live and die by the performance of your contextual ads. The top providers of contextual ads are Google AdSense (Nasdaq GOOG), Yahoo Publisher Network (YPN) (Nasdaq YHOO), and Adbrite. I have used all three of them in the past and as a blogger, I've been doing various tests to improve and increase the performance of my ads. One way I improved my click thru rate was to place ads in a prominent place. Another way I improved my click thru rate was to choose the right colors for the ads.

Blending the colors of my AdSense ads improved my conversion rate by over 30%.

I first found out about the importance of choosing the right colors when I read the AdSense blog . AdSense recommends blending the color of your ads with the color palette of your webpage so I tested it. Let me show you what I did.

How I improved the CTR of my leaderboard by 36%

Before I started this test, the conversion rate of my leaderboard was 0.23% which meant that for every 1000 page views, 2 people clicked on it - a very low conversion rate. My A/B test was very simple. I took a regular leaderboard (728x90) and I changed the color of the URL link. The standard palette has a URL link color of #999999 which is gray. My custom palette had a URL link color of #FFFFCC which is yellow. That one simple change improved my click thru rate by 36%. For every 1000 page views, 3 people clicked on my leaderboard.

How I improved the click thru rate of my large rectangle by 31%.

I took a large rectangle (336x280) and I did the same thing. The standard palette has a URL link color of #999999. My custom palette had a URL link color of #FFFFCC. That one simple change improved my click thru rate by 31%. With the standard palette, 4 people clicked on the large rectangle per thousand page views. With the test palette, 5 people clicked on the large rectangle for every thousand page views.

Explaining the Results
Since the only thing I changed was the color of the URL, color clearly plays a very big role in explaining the improvement in click thru rate. My big conclusion is this:

Less is more. Readers like white space and yellow looks white. By choosing yellow as the color of the url, perhaps some of the readers saw white space. If this is the case, then my experiment suggests that readers are more likely to click on an ad that gives them less detail about a product or service than an ad that bombards them with information. People like things to be simple - think Google.

I was very surprised when I crunched the numbers and found that changing the color of my ads could increase the click thru rate so dramatically. If you're reading this and don't believe me, go ahead and try it yourself.

BabyUniverse : Hit Me Baby One More Time!

posted by MR WAVETHEORY at 12/27/2006 12:20:00 AM
You have to give the team at BabyUniverse, Inc. (Nasdaq POSH) alot of credit for surviving not only the dot com boom and bust, but also managing to take the company public after weathering the storm. They are true dot-com survivors with the battle scars to prove it. When I read today that BabyUniverse is launching (press release) - the Internet's first television network dedicated to moms - yes, they're trying to play the online video sharing trend - I decided to take a peek at what they've been up to for the last couple of years.

BabyUniverse started in 1998, and was a classic dot com. They raised venture capital when it was easy to find. Their arch rival was BabyCenter, which was folded into Johnson & Johnson (NYSE JNJ) after they ran out of money.

The idea is simple: BabyUniverse sells all sorts of products to women related to pregnancies, taking care of toddlers, and raising a baby. They're what I would call a niche e-commerce play - an etailer focused on a very narrow vertical. They several websites which in total have an audience of about 1.7 million unique visitors per month.

The e-commerce properties include:
The content properties include:
What's interesting about this concept is that BabyUniverse is merging commerce and content, thereby turning a retail business with predictable and steadily eroding margins into a media business with less predictable but much higher margins. If etailing is like selling Coke, then advertising is like selling cocaine. First hit is free, but future hits will cost you money.

The analogy works in several ways. Content costs money to create and will cost money to build, but content is much higher margin once it has been created, because advertising is a very high margin business. If only BabyUniverse could solve that content creation problem, it would be a great investment. Has it?

The answer is yes. BabyUniverse is partnering with Oxygen TV for programming as well as AlphaMom. has already partnered with the acclaimed women's media company Oxygen, as well as video-on-demand pioneer Alpha Mom, to bring a wealth of informative and entertaining programming to our viewers. Oxygen's "Oh!Baby" video on-demand (VOD) programming contributes segments of their popular shows, with content celebrating the highs and lows of parenthood. Alpha Mom contributes a deep catalog of informative programming featuring recognized experts on important topics from pregnancy through early child development.

I have to hand it to the team at BabyUniverse for going with a partnering strategy.

Would I Go POSH for BabyUniverse?

What I like about BabyUniverse's strategy is precisely that they are focusing more on content and shifting into the high margin online advertising business - think Google type margins. BabyTV takes them precisely in that direction by reaching a highly targeted demographic - pregnant women. According to POSH, is delivered through an interactive format in which the consumer can tune in to broadcast-quality live and pre-recorded streaming television, interact through live events, respond to synchronized and targeted advertisements, engage in e-commerce transactions, browse links on the Web, and participate in's community features, without ever leaving the integrated broadcast platform.

BabyUniverse clearly has the business model figured out. In fact, they have already started syndicating content to of all companies,

Commenting on the agreement, John Textor, Chairman and CEO of BabyUniverse, stated, "We are extremely pleased to announce Amazon as the first significant strategic relationship designed to support our long- communicated plan to transform BabyUniverse from a pure e-commerce company into a balanced content, commerce and new media concern. With an audience of more than 60 million active customer accounts, Amazon presents an opportunity for national brand prominence for our and content properties.

Is BabyUniverse stock a buy at $7?

Beyond saying that there is risk in any investment, I'd say POSH is a BUY. The market cap is $40 million and the company has trailing twelve month revenues of $35 million vs $24 million in 2005, $14 million in 2004, and $8 million in 2003. They are adding about $10 million in incremental revenue per year which is fantastic, steady, and predictable.

All else aside, the price is right at $7 and I'd say the going gets better for BabyUniverse. This baby has legs. Hit me baby one more time!

December 26, 2006

eBay Beats This Holiday Season

posted by MR WAVETHEORY at 12/26/2006 06:00:00 AM
It's fun to see who won and who lost in this year's online shopping war. The biggest winner by far was eBay Inc. (Nasdaq EBAY), followed by Inc. (Nasdaq AMZN), and (NYSE WMT). eBay traffic grew 12% vs Amazon's 2%. Basically, traffic at Amazon barely budged. But of the big three, Wal-Mart Stores, Inc. grew the most + 21%. Nielsen//NetRatings also announced hat visits to the Holiday eShopping Index grew 20 percent year over year in the week ending December 10th, from 469 million to 563 million. Toys/Video Games was the fastest growing product category during the same time period, with visits increasing 49 percent. Books/Music/Videos was the second fastest growing product category year over year, increasing 46 percent, followed by Consumer Electronics with 27 percent growth.

eBay led the top online shopping destinations during the most recent week, with 34.2 million unique visitors. Amazon took the No. 2 spot, and rounded out the top three.

Top Online Shopping Destinations for Week Ending 12/10/06 (U.S., Home and Work)


x000 Week Ending 12/11/05

x000 Week Ending 12/10/06

Year Over Year Growth









Wal-Mart Stores











Source: Nielsen//NetRatings, December 2006

The top five fastest growing online shopping destinations indicate that Web visitors are not only looking for gifts online, but also ways to escape and save time during this busy time of year.

Shopping comparison Web site MySimon was the fastest growing online shopping destination year over year during the week ending December 10th, increasing 124 percent. Web traffic to, which offers good deals on a variety of accommodations, grew 76 percent year over year. And finally, Web traffic grew 76 percent year over year as tired cooks logged on to Schwan's Home Service, which ships prepared meals from their kitchen to your freezer.

Year-Over-Year Fastest Growing Shopping Destinations for Week Ending 12/10/06 (U.S., Home and Work)


(000) Week Ending 12/11/05

(000) Week Ending 12/10/06

Year Over Year Growth





Columbia House







Choice Hotels Intl.




Schwan's Home Service




Source: Nielsen//NetRatings, December 2006

Barrons Weekend Headline Summary - December 25, 2006

posted by MR WAVETHEORY at 12/26/2006 04:00:00 AM
Welcome to Sizzle Inc.
The "platform economy" -- a business model focused on knowledge while outsourcing production -- heralds an age of unprecedented U.S. prosperity.

Companies Mentioned: Apple Computer, Inc. (Nasdaq AAPL), Motorola, Inc. (Nasdaq MOT), Hewlett-Packard Company (Nasdaq HPQ), Dell Inc. (Nasdaq DELL), The Black & Decker Corporation (NYSE BDK), International Business Machine Corp. (NYSE IBM), Analog Devices, Inc. (NYSE ADI)

Mastering New Media
E. W. Scripps has a knack for anticipating changes in its audience and shifting its strategy to take advantage of powerful media trends.

Companies Mentioned: The E.W. Scripps Company (NYSE SSP), Gannett Co., Inc. (NYSE GCI), Belo Corp. (NYSE BLC), The New York Times Company (NYSE NYT), Tribune Company (NYSE TRB)

Visible Growth
ITT is ready to weather cyclical and economic fluctuations. Better yet, its defense electronics and water-treatment devices can continue to drive double-digit profit growth.

Companies Mentioned: ITT Corporation (NYSE ITT), Honeywell International Inc. (NYSE HON), General Electric Company (NYSE GE)
Hurdles Ahead
Institutional Capital's three funds have all gained more than 20% this year, thanks to the prowess of its co-chief investment officers.

Companies Mentioned: Mainstay ICAP Select A (Nasdaq ICSRX), Mainstay ICAP Equity A (Nasdaq ICAUX), Mainstay ICAP International A (Nasdaq ICEVX)
The Liquidity Curse
Behind Thailand's botched attempt to stop the flow of foreign money. What it portends.

Companies Mentioned: Google, Inc. (Nasdaq GOOG)

Sturm And Sanity
Emotions ran wild. Stocks didn't. Not a bad outcome, after all.

Companies Mentioned: Pharmaceutical HOLDRS (Amex PPH), Ford Motor Company (NYSE F), Pier 1 Imports, Inc. (NYSE PIR), Level 3 Communications, Inc. (NYSE LVLT), GSI Commerce, Inc. (Nasdaq GSIC), Best Buy Co., Inc. (NYSE BBY), Danaher Corporation (NYSE DHR), UAL Corporation (NYSE UAUA), Wendy's International (NYSE WEN), Tim Hortons Inc. (USA) (NYSE THI), Alaska Communications Systems Group, Inc. (Nasdaq ALSK), Netratings, Inc. (Nasdaq NTRT), Sprint Nextel Corporation (NYSE S), Source Interlink Companies (NYSE SORC)

Let's Hear It For Risk
The junkiest bonds did best this year, as default rates plummeted.

Companies Mentioned: General Motors Corporation (NYSE GM), iShares Lehman Aggregate (ETF) (AMEX AGG), iShares iBoxx $ InvesTop Invest Grad Cor (AMEX LQD), S&P 500 Index - "Spiders" (AMEX SPY)
A Respectable Report Card
Our calls -- the good, the bad and the ugly -- of the last year. Over all, not so bad.

Companies Mentioned: AT&T Inc. (NYSE T), Viaspace (VSPC.OB), CSR (CSR.L), Broadcom Inc. (Nasdaq BRCM), Neurochem (Nasdaq NRMX), Imclone Systems (NYSE IMCL), Amgen Inc. (Nasdaq AMGN), Allscripts Healthcare Solutions (Nasdaq MDRX), Advanced Micro Devices (NYSE AMD), Intel (Nasdaq INTC), Sandisk (Nasdaq SNDK), Samsung Electronics Co., Ltd. (005930), Micron Technology, Inc. (NYSE MU), Applied Materials Inc. (Nasdaq AMAT), Imax Corporation (USA) (Nasdaq IMAX), Atheros Communications Inc. (Nasdaq ATHR), Netgear Inc. (Nasdaq NTGR)

December 25, 2006

The Top 10 Stocks of 2006

posted by MR WAVETHEORY at 12/25/2006 07:38:00 PM
It's always interesting to look back and see what the top 10 stocks performers were this year. So, I went to MSN and Yahoo to see what they came up with.

MSN's Top 10 Stocks for 2006
MSN has a Power Search that screens the top stocks for 2006. It's very easy to use, because it is pre-defined so all you have to do is click. According to MSN, the top 10 stocks were:

This Year's Winners
Symbol Company Name % Price Change YTD Prev Day's Mkt Capitalization Previous Day's Closing Price
FMXIQFoamex International Inc.22,361.50144 Mil5.75
AUREFAurelian Resources Inc.6,080.00826.8 Mil26.63
EFRFFEnergy Fuels Inc.4,188.9089.79 Mil3.39
FRPTForce Protection, Inc.1,950.00847.6 Mil15.99
TIXCTix Corp.1,511.1081.25 Mil4.35
ITKGIntegral Technologies, Inc.1,187.70166.8 Mil3.67
BLEFFBlue Pearl Mining Ltd.1,185.70395.3 Mil7.63
DPHIQDelphi Corporation1,154.302.051 Bil3.81
RDNTRadNet Inc.751.90148.7 Mil4.60
NWACQNorthwest Airlines Corporation648.20352.7 Mil4.42

I hadn't heard of most of these companies. You can see three of the top 10 stocks are in bankruptcy and/or reorganization. They are denoted with the Q in their ticker symbol. Also, it is interesting to see that six of the top 10 are on the pinksheets.

I don't recognize most of these companies except for two of them - Delphi Corporation and Northwest Airlines. Delphi was trading at penny stock status until recently when it announced restructuring plans, while Northwest Airlines has been bankrupt and recently caught a bid due to the mergers in the airline industry between US Airways and Delta Airlines.

Yahoo Screen for Top 2006 Stocks
Yahoo has a really cool Java screener that allows you to search for stocks based on price gain. In order to use you it, you enter your stock screening criteria. I did a screen for the top stocks of 2006 based on the price gain from the 52-week low of 2006. My criteria was Share Performance -> Extreme Price Parameters % -> Current Price Greater Than 52 Week Low (%). The Yahoo! list produced some different results, but even bigger gains than the MSN list.

Ticker Company Name Last Trade Mkt Cap Extreme price change %

MHJ MAN SANG HLD INC 5.1 32.6M 50900


NVH NATL RV HLDGS INC 3.6 37.2M 35900

KSW KSW INC 6.75 38.7M 850.704

VRTB VESTIN REALTY MOR 5.25 203.8M 582.501

MDV MEDIVATION INC 15.95 404.0M 578.723

HGO HOUSTON AMERICN E 7.31 203.4M 494.309

GVP G S E SYSTEMS INC 6.53 61.8M 493.636

APN APPLICA INC 7.28 182.0M 487.097

IIG IMERGENT INC 25.28 310.7M 460.532

Here you can see that half of the companies have market caps of less than $100 million even after their torrid gains. The most impressive gainers were MHJ WOC and NVH which gained 50,900%, 46,900% and 35,900% respectively meaning they produced gains of several hundred times off their 52 week low.

These indeed were the super stocks of 2006!

Chinese Professor Predicts More Good Times for the Chinese Economy and China

posted by MR WAVETHEORY at 12/25/2006 03:40:00 PM
Wharton: Taken on a day when the city of Phily actually got sun.

If you're having a great time after having had a grand Christmas holiday dinner, you may want to read the cheery news coming out of China. Knowledge@Wharton did a recent survey on China and found that policy wonks are predicting a 9.25% growth rate for the economy in 2007 which is higher than the official prediction of 8%. The Chinese are making some incredible predictions about their economy. The highlights.

Chinese policy makers are predicting 9.25% growth in 2007.

Meanwhile, predictions from economists within China suggest that their country's economy is on solid footing. According to Zheng Chaoyu, director of the Institute of Economic Research at Renmin University in Beijing, in 2007, China will experience low inflation and a 9.25% growth rate, higher than the official prediction of 8%, but not as high as 10% "because the fixed-asset investment growth rate will continue to drop, and the export growth rate will be lower due to such factors as RMB appreciation." Zheng also thinks that the government will continue its "moderate and stable finance and currency policy.... No drastic changes are expected."

China is predicting 10% increases in annual wages for the next few years. The report by the State Information Center is entitled China's Macro Economy and Policy: 2006 and 2007 and if you read the full report, you see that things will be even better for the average Chinese worker, who will see a 10% increase in wages annually for the next few years. That is simply astonishing.

Zheng believes that the upward trend of FDI in China will be sustained in 2007. "We have a huge market and cheap labor, which is most attractive for foreign investors." Labor costs, he acknowledges, are "on the rise but will not have a [negative] impact in the short term." Long term, he adds, it is unclear whether productivity growth will counteract the impact of higher wages. His report assumes that wages will be growing at 10% annually.

Now, if you are mathematician and finance type, you know the rule of 70 which states that if you take the number 70 and divide it by the growth rate X of something, you get the number of years it takes to double something. So, if you take 70 and divide by 10%, then you get 7, implying that in seven years, wages for the average worker in China will double. Consider for instance the US, where wage inflation has been between 1.4% and 3.5% for the last 5 years:

2001 = 2.7%
2002 = 1.4%
2003 = 2.2%
2004 = 2.6%
2005 = 3.5%

All things being equal, that means the average Chinese is seeing triple the improvement in wages than the average American! This has some pretty big implications for private equity and venture capital investors.

In 7 years ...

  • the farmer riding the bike today could be driving a car
  • the manufacturing worker making auto parts could be running a global car company
  • the student eating pork buns at a xiao-chi stand could be eating KFC (they already are)
Imagine what Chinese consumers will be able to afford 7 years from now! I predict the Chinese consumer will be the biggest icon of conspicuous consumption 7 years from now.

China's RMB will appreciate at 6% between 2006 and 2010.

According to a report he contributed to, titled "China's Macro Economy and Policy: 2006 and 2007," the annual RMB appreciation rate will be at 6% between 2006 and 2010. "Our estimation is probably too bold," he notes. "But since the beginning of exchange rate reform, the actual exchange rate change was 2% to 3% higher than many people's expectation."

Translation: If you invest in China, you will earn at least 6% - that's at least 6%! I like the sound of that! Compare that to the 4.625% return on US Treasuries and you know where my money is going!

What Will Real Investment Returns Be In China?
Alas, if you believe the report (sometimes you cannot trust everything they say), then real investment returns will be phenomenal in China for the next 5 years.

Here is the definition of the real return from Economics 101:

Real returns = GDP Growth + Productivity Improvement - Inflation + Foreign Exchange Gains

Plug in the variables (assume 0% productivity improvement to be conservative, and 2% inflation based on government data):

Real returns = 9.25% + 0 - 2.00% + 6.00% = 13.25%

The magic number is 13.25%. A 13.25% real return for investments is huge, considering that the 10-year US Treasury yield is at 4.625%. That is 2.8X the US rate.

Being Thankful for Beer and Champagne!
Tsingtao's is China's largest brewery founded in 1903 by German settlers, taken over by the Japanese in WWI, and reverted back to the Chinese.

If there is anything I will be thankful for this holiday season, it's the tremendous growth of the economy in China! I hope all those Chinese workers have a great holiday, because although they might be drinking Tsingtao Beer this holiday season, they will be drinking Dom Perignon in 7 years! OK, maybe not Dom, but in 7 years time, they will be drinking champagne, probably an expensive Chinese champagne!