I've just gotten the third emailed request to answer a brief survey in order to renew my Infoworld subscription. This is on top of the two or three snail-mail requests that arrived either with the magazine or seperately.

I haven't bothered responding because this is one publication I never read on paper anymore. All their good columns are syndicated and can be read in any RSS reader (one excellent career column is linked at the left). In addition, their content is free, online and searchable. They will send you email updates of anything that meets your personal interest criteria.

Why would I want to kill trees to get this thing?

I think many, many of their subscribers must be coming to the same conclusion.

Historically, you had to get on a waiting list to be approved for a complimentary subscription to this kind of magazine. The logic was that they would give a limited number of free subscriptions to "qualified" individuals and their advertisers would pay to reach those individuals, typically people with significant budgetary and purchasing influence in large IT shops.

I know where I stand in the overall scheme of things and it's not that high up. After all, I'm mostly working in consulting roles where I have no budget and no purchasing authority at all. At most, I can have some influence on the people who do.

The fact that they're chasing me down this way suggests that they're having a tough time coming up with enough qualified individuals to keep their advertisers happy. The one-year waitlists of the past must be long gone, destroyed by the easy access that the web provides.

It says another thing, which I've alluded to before and still strongly believe: advertising on the web is cheaper than advertising elsewhere. This is a big problem for those institutions that depend on advertising dollars. Just moving to the web isn't enough. A new strategy for making money in a completely different medium is also necessary. For many media outlets, the transition will turn out to be impossible and they'll be replaced by something new and different.

We are still in the early innings of this game, as evidenced by Infoworld's desperate attempts to hang on to complimentary subscribers like me, who don't even want their product for free.

-btc

I've avoided talking about Overstock.com (NasdaqNM:OSTK) in this space, though I've participated in some discussions about it over on Jeff Matthews' Blog. Mostly I've avoided it because I generally have little to do with "battleground" stocks like OSTK. Just too many ways to get burned, long or short. I've also avoided it because it's become an unholy battleground with allegations of illegal market activities by hedge funds, strippers in the executive suite, Sith Lords, insanity and all sorts of other things that would make a great movie but a lousy place to risk one's money.

To the extent that I've commented on it at all, I've been mostly concerned with the qualifications of the people who OSTK's CEO has chosen to surround himself with, and in particular with Shawn Schwegman, the Senior Vice President of Technology, who Overstock's CEO has hailed as "The Best CIO in America."

My interest in this intensified over the weekend, after Overstock announced after the close on Friday that they were going to miss their sales targets because a problem with an IT upgrade led to them being unable to upload new merchandise listings to their site for five weeks. That's not a major glitch, for a retailer it's a major disaster. I recall when Agilent Technology (NYSE:A), a company that I had been affiliated with in the past, lost two weeks of business due to a problematic Oracle implementation a few years ago. Heads rolled, as well they should. The fact that it could happen means that risks were ignored, proper project management procedures were not observed, and more than likely, corners were cut when somebody should have said "stop!"

But Overstock went for five whole weeks, and everybody still seems to have their jobs. What the hell is going on?

I've restricted comments and trackbacks to the items that I've posted in the last three weeks, and expect to continue doing this going forward. I'm just getting too much comment spam to older pieces and even with MT-Blacklist in place, it's a pain to do so much de-spamming.

I will be upgrading the whole blog to MovableType 3.2 in the next week, so please try again if you can't get to the site for a day or so. In part, I'll be doing this because of the newer anti-spam capabilities of the latest version.

Even with the new capabilities, I am going to be a bit more judicious about which postings I open for commentary and trackbacks. For example this one, on which there should be no real need to comment.

A couple of people emailed me about my Barr Pharma (NYSE:BRL) trade and some thoughts about it. I thought it represented a good opprotunity to discuss risk and one of the ways I manage it.

The Entry

The trade was done purely for technical reasons. Last Tuesday, September 6th, BRL made a monster move, gapping up about $3, on the highest volume seen in months and shattering a three-month downtrend. It triggered one of my screens that looks for breakouts. In this case, the move was big enough that I noticed it during trading hours and was able to get in before the close at a price of 49.92.

[In restrospect, had I waited to review charts overnight as I normally do, I might have done a bit better buying at the open on the 7th.]

The stock then made another monster move on the 8th and a smaller one on the Friday the 9th. Had I not been sick on the 9th, I probably would have closed out the position at around $54, for a gain of just over 8% in three days. It appeared a bit toppy, was flirting with the high from April and was just a couple of points shy of the all time high. My judgement in those situations is usually pretty simple: resistance overhead, a huge gain to be taken and no fundamental conviction about the stock. Time to get out.

But I have another rule, and that's that when I'm in no shape to trade, I don't trade. Friday I was in no shape to trade. I didn't even turn the computer on, and slept much of the morning. I kept the position into the weekend. I am careful about risk in my trading, and I count on my risk management processes to save my neck should anything happen during the missed day.

My Risk Management

I employ a variety of risk management strategies, depending on what the positions are, what the timeframe is, and what I believe the underlying fundamental risks to the stock might be. For simple "technical" trades like the one in BRL, I rely on position size combined with a simple stop loss order to take care of most of the risk. As I would realize quite vividly this morning, that process has a big hole in it.

I Always Liked the Guy
The first major airlift of dogs from the Gulf Coast left Louisiana on Sunday, carrying about 80 pets to temporary homes in California.
The Continental Airlines flight from Baton Rouge, La., was chartered for about $50,000 by Texas oilman T. Boone Pickens and his wife, Madeleine, in a mission dubbed "Operation Pet Lift."
I came of age in the era of the 1980s LBO mania. It was an era filled with truly scummy characters, but the one guy I always liked was T. Boone Pickens. Say what you will, he was a class act in a brutal business, and unlike many of his brethren, he never was accused of a crime or went to jail. I'm glad to see that my feelings about his character were not misplaced.

Definition of Stress:
Waking up to see one of your biggest trading positions (BRL) open down over 35%, blowing about $20 down below your stop.

Definition of Relief:
Realizing that the price was apparently a misprint and that your stop order was not executed.

Definition of "Going with Karma":
Deciding that while it's nice not to lose 35% on an unhedged position, my objectives on the trade had been more than satisfied with it hovering just below the all-time high. Closed for an 8% gain in less than a week.

-btc

Still No Inflation Here
But the Coffee Bean has discontinued the repeat customer program, aka "pink cards" claiming this is necessary because of rampant counterfeiting. Granted, the marks on the paper cards were notoriously easy to fake, primarily because the chain couldn't be bothered to maintain the custom punches that are supposed to be at each store, and the stores resorted to marking them with pens. But a store manager I know tells me that the inside scoop is that the cause is something else. They're at the point where they either need to stop giving out free drinks -- essentially a 10% discount for regular customers -- or raise prices. With prices for a typical latte-type drink just below three bucks, they didn't want to increase them past the $3 line until Starbucks did it first.

I've Been Silent This Past Week, mostly because the things on my mind were really not all that well organized, or all that relevant to the overall theme of this blog. Let it suffice to say that as a trained first responder, I found and continue to find the response to Katrina at all levels to be lacking; lacking in leadership, lacking in planning; lacking in caring and concern by those who we elect to the job of being concerned. Virtually anybody who had any managerial responsibility for this mess at any level deserves his or her walking papers, because they all failed. And in keeping with my management philosophy, whoever hired this bunch of incompetents deserves the same or worse.

Today's Move in the Markets, should hardly come as a surprise, and while I'm glad to have a small long position, I'm still very, very cautious. The impacts of the past week are still not well understood by anybody, and a celebration at a small drop in the price of oil seems somewhat misplaced.