Can Turtles Fly?

Michael Lewis has a book out on FTX scandal, the cryptocurrency exchange that collapsed. The following Bloomberg Masters in Business podcast is pretty good and goes over many topics.

(Copyright Parker Brothers. Download source .) (This post was partially written about two months back so some additional details confirming the story have emerged in the last few weeks. The main story remains the same.) Crime never really pays. Sooner or later, criminals get caught — not all the time, of course, but most of the time (in countries with adequate policing, with "decent" culture and legal system). One big reason criminals don't get away is because it's hard to cover the tracks. There are just too many things that can go wrong when trying to mask a crime's evidence. Such is the case with the Japanese electronics company, Olympus. Readers may recall a post from a while back , pointing out how the CEO of Olympus was fired within 2 weeks of being hired. Things looked puzzling at that time and the story kept getting interesting by the minute — assuming you are not a shareholder of Olympus, of course. Over the last month, the fired CEO reveal...

The Cost of Cocaine & Incidence of Use (source: " The cost of coke ," The Economist Daily Chart. June 23, 2011) I wonder why the usage varies quite a bit between countries. Why do 2.6% of the population (16-64 yrs old) use it in Spain but only 0.6% in France? Is there another drug that is a substitute or is there something more to it?

NOTE: Do not construe anything written below as implying that Sino-forest is a fraud. I'm simply repeating some who are presenting information that casts doubt on Chinese RTOs, including Sino-forest. Their opinions may or may not be correct. Future of stock price movements cannot be predicted with certainty. As I and others have mentioned, it appears that a big number of Chinese RTOs (reverse-take-overs) are dubious and in some cases, outright scams. So far, most of these have been micro-caps and small-caps. However, one of the bearish research firms, Muddy Waters Research , has tackled a bigger company, Sino-forest (TSX: TRE), whose market cap before the recent sell-off was around C$3 billion. Sino-forest is a forestry company listed on the Toronto Stock Exchange—it was actually a darling of some commodity investors a few years back—with operations largely in China, with some marginal stake in New Zealand. A few days ago, Muddy Waters Research published an extremely bearish 19...

Reading material for a sunday... and beyond... Unintended consequences of China's capital controls (WSJ China Realtime Report): Found a good blog on China by The Wall Street Journal. Maybe it was always there but I never looked at it much before. China followers and commodity investors should check out that blog. Anyway, this story deals with how some in China are hoarding soybeans in a convoluted scheme to raise capital. None of it makes any sense—some of you may have heard of stories a few years ago about hoarding copper and steel but soybeans?—until you think about China's capital controls and how it severely distorts currency and interest rates. Stephen Elop & Nokia (Report on Business magazine): Lengthy profile of Nokia's CEO, Stephen Elop, and some history of Nokia. I've been following Nokia for a little over an year and thinking of making an investment in it. (Highly Recommended) "Should you buy Microsoft?" (Geoff Gannon for GuruFocus): Geoff...

Some articles, including some important ones summarizing the Berkshire Hathaway meeting held a few weeks ago. (Highly Recommended) Warren Buffet 2011 shareholder meeting notes (Ben Claremon for GuruFocus): Very detailed and extensive notes from last week's shareholder meeting. Too bad it's in scribd format (am I the only one on the planet without a Facebook account yet? ;) ) (Recommended) Summary of Warren Buffett 2011 shareholder meeting (Epic Investor): Another pretty lengthy summary of the shareholder meeting from earlier in the month. (Recommended) TV interview of Warren Buffett and Ajit Jain (NDTV via GuruFocus): First time I've seen the publicity-shy Ajit Jain... I wish someone would ask Buffett to walk through one of his past investments. The canned questions and short TV-oriented questions have been repeated a million times and are a complete waste of time for people like me. Oh well. Maybe Alice Shroeder will write an investment book soon. (Recommended) ...

If you didn't have enough reading for the week, fear not. Information overload is just around the corner ;) Here are some items that you may find interesting... Book excerpt - The Wizard of Lies: Bernie Madoff and the Death of Trust by Diana B. Henriques (New York Times): Major bubbles are often marked by criminal actions and the stock market crash that started in 2007 was no different. Bernie Madoff will be remembered for centuries, well beyond our lives. Book excerpt -  Money and Power: How Goldman Sachs Came to Rule the World  by Wiliam D. Cohan (vanity Fair): Haven't read it yet but it seems to be about the battle between Jon Corzine and Henry Paulson for the leadership of Goldman Sachs. Carl Icahn at 75 (New York Times; h/t The Reformed Broker): Hated by some, loved by some, we are seeing the final moments of one of the most influential shareholder activists that ever lived. ROIC in various industries (Barel Karsan): Although returns for stockpickers is ...

The Bernie Madoff debacle, whereby the SEC completely missed his illegal activities, has certainly lit a fire under the SEC. There have been several charges against those benefitting, or abetting, insider trading and the trend continues with four managerial-level employees arrested today. According to MarketWatch, Federal authorities said Thursday that they arrested four people on insider-trading charges, including three former employees of technology companies Advanced Micro Devices, Flextronics International and Taiwan Semiconductor Manufacturing Co. Another person — Daniel DeVore, 46, formerly a global supply manager for Dell Inc. — pled guilty on Dec. 10 to wire fraud and conspiracy to commit wire fraud and securities fraud, the authorities said. He’s cooperating with prosecutors, according to a plea agreement released Thursday. Among the allegations, filed in the U.S. District Court for the Southern District of New York, authorities claimed that the former Flextronics employ...

MarketWatch is reporting that the founder of of Galleon Group, a large technology-focused hedge fund, is being charged in federal courts with insider trading : Galleon Group's billionaire founder, Raj Rajaratnam, was charged Friday in a sweeping insider-trading case, according to court documents filed in Manhattan by federal prosecutors and the Federal Bureau of Investigation. Rajaratnam and five others allegedly involved in the scheme have been arrested. A phone message seeking comment that was left at Galleon's New York headquarters Friday morning wasn't returned. The other defendants are: Rajiv Goel, a managing director at Intel Capital, a unit of Intel Corp.; Robert Moffat, a senior vice president at IBM Corp.; Anil Kumar, a director at consulting firm McKinsey & Co.; Danielle Chiesi, portfolio manager at $1 billion hedge-fund firm New Castle Partners; and Mark Kurland, a senior managing director and general partner at New Castle, which was the equity hedge-fund gr...