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One Billion Dollars Short, Bill Ackman, and the Siege Of Herbalife (2015)

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Re: One Billion Dollars Short, Bill Ackman, and the Siege Of Herbalife (2015)

#81

Post by jmull »

ridruejo wrote: post #12
anilshanbhag wrote: post #2

John Oliver discussing Herbalife https://www.youtube.com/watch?v=s6MwGeOm8iI Bill Ackmann on Herbalife https://www.youtube.com/watch?v=bQc6L4ieMwo Almost 60% of their distributors were latinos ( http://articles.latimes.com/2013/feb/15/business/la-fi-herba... ). The lengthy presentation countering Pershing Square's accusations which contained this fact ( http://files.shareholder.com/downloads/ABEA-48ZAJ9/229776353...…

You may not like it, but it is not necessarily a scam. Some of the posts by Bronte capital mentioned in the article http://brontecapital.blogspot.com/2015/06/herbalife-very-lon... http://brontecapital.blogspot.com/2016/07/herbalife-and-end-...

I think you meant to say it's not necessarily illegal. It's a scam in any case because the products don't do what the people buying them are lead to believe they do and the distributor opportunities aren't the oppotunity the people buying into them are lead to believe.

Re: One Billion Dollars Short, Bill Ackman, and the Siege Of Herbalife (2015)

#82

Post by hyperbovine »

diogenescynic wrote: post #39
gnu8 wrote: post #33

Earlier quoted context omitted.

Seems like a sure thing to short the piss out of an enterprise like this and wage a comprehensive campaign of activism and consumer education against it. With rationality on your side, how could you lose?

>With rationality on your side, how could you lose? Hahahhaha. Great joke. Sadly, there are and probably always will be a lot of ignorant/gullible people. As PT Barnum said, "there's a sucker born every minute."

Actually, there is no evidence that he ever said this.

Re: One Billion Dollars Short, Bill Ackman, and the Siege Of Herbalife (2015)

#83

Post by gehsty »

anotherbrownguy wrote: post #80
zzleeper wrote: post #37

I've got the feeling this thread is full of people that drank the BS koolaid of herbalife. They either sell snake oil products, or protein shakes that are 10x cheaper at Costco. I've known people desperate enough to start selling that crap (as well as others-their friends-that have to buy it just due to friendship), so please stop spreading MLM scams.

>I've known people desperate enough to start selling that crap (as well as others-their friends-that have to buy it just due to friendship), so please stop spreading MLM scams. They offer 100% buyback for distributors for unopened products and they stopped lead generation completely 4 years ago. So, their distributors are no different from what cell phone carriers are to Apple. >They either sell snake oil products, o…

I think the main difference is that there is a chain of people who profit from selling to their 'downlines', not when a product is sold to an actual customer.

The analogy to apple is poor. Apple sell a product that the majority of people like and they are actively trying to sell directly to the customer. They use networks as it is their only option in many markets and once a phone is sold to the network it is then sold to the customer, there isn't a series of transactions with each level profiting of the previous level.

Re: One Billion Dollars Short, Bill Ackman, and the Siege Of Herbalife (2015)

#84

Post by asdfjklasdfjkl »

hyperbovine wrote: post #82
diogenescynic wrote: post #39

Earlier quoted context omitted.

>With rationality on your side, how could you lose? Hahahhaha. Great joke. Sadly, there are and probably always will be a lot of ignorant/gullible people. As PT Barnum said, "there's a sucker born every minute."

Actually, there is no evidence that he ever said this.

In this instance, I'd say it's an even better quote, then.

Re: One Billion Dollars Short, Bill Ackman, and the Siege Of Herbalife (2015)

#85

Post by dsacco »

PeterisP wrote: post #77
lordnacho wrote: post #71

Earlier quoted context omitted.

> Agnostic to his Herbalife bet, Ackman "has widely underperformed the S&P 500 since its EOY 2012 inception: 7.1% since inception net of fees vs. 84% for the S&P 500. Their original flagship fund's (2004 inception) track record is outstanding with returns of ~20% per annum." But why should the S&P 500 be the benchmark for what Ackman does? If he was advertising that he's betting on broad market risk it would make sen…

The "market average" like S&P is the expected return of passive investment - doing nothing, so that's why it's a reasonable benchmark. This (not 0%) is the straightforward default alternative investment, the one against you can measure an opportunity cost. The point of hedge funds is that they can do better than that, but charge a fee. However, if you get worse results than doing nothing, then the fee seems unjustifi…

The commenter you're responding to is aware of all of that, as he works in the industry. With regard to "the point" of hedge funds, what you're saying is not actually correct - the S&P500 is not necessarily an appropriate benchmark for comparison because it doesn't share the same risk profile. Concordantly it is not necessarily a failure if a hedge fund achieves a lower return than the S&P500 depending on its beta exposure.

In general, the S&P500 presents the most cursory comparison metric for hedge funds, but not necessarily the most accurate. This is specifically why we have the term, "risk-adjusted returns."

Re: One Billion Dollars Short, Bill Ackman, and the Siege Of Herbalife (2015)

#86

Post by Top19 »

All MLMs are scams. I hate using the term pyramid schemes, because if you use that term all of the MLM apologists will start cranking out very long-winded philosophical definitions of pyramid schemes that obscure the true point.

The MLM "model" can be summarized thusly:

- 1. Give people pretty good business advice from a host of good business books

- 2. Give people a very positive exciting environment

- 3. Give people literally the WORST job ever created with a product that cannot exist on its own in the marketplace if it wasn't being artificially propped up by hundreds of thousands of distributors

MLMs are scams. And no matter how much they try to attack other industries by saying how unethical they are, or how much they lie about their products, that can never and will never absolve them for the damage they have done to so many lives.

ALSO: something else you'll notice is that people who've been involved with MLMs might recall them fondly. This is just a defense mechanism (an extremely understandable one) to prevent having to view oneself as being duped. I think it's a shame though because we'll all be duped or scammed to some degree in our life, no need to change the past. Anyway reading "The Big Con" by David Maurer right now, a book by a sociologist about con-men in the 1940s. It's the basis for the movie "The Sting", and its remarkable how many people in the book are conned but refuse to believe it, and even years later still think their guy is out there, about to return their money at any time with 20x the profit or whatever.

EDIT: Also it is nearly impossible to look this stuff up on Google. MLM people have so carpet bombed the search sites the first 30 or so links will be links to Youtube videos with titles like "Is XYZ company a scam??" that find of course it's not. Occasionally a random legitimate news article will leak through. Otherwise they've literally walled the world off from anti-MLM information.

Re: One Billion Dollars Short, Bill Ackman, and the Siege Of Herbalife (2015)

#87

Post by throwaway7645 »

Top19 wrote: post #86

All MLMs are scams. I hate using the term pyramid schemes, because if you use that term all of the MLM apologists will start cranking out very long-winded philosophical definitions of pyramid schemes that obscure the true point. The MLM "model" can be summarized thusly: - 1. Give people pretty good business advice from a host of good business books - 2. Give people a very positive exciting environment - 3. Give peopl…

Yes, they've completely subverted the internet for their own use. You can send people in need to John Oliver's amazing piece though.

Re: One Billion Dollars Short, Bill Ackman, and the Siege Of Herbalife (2015)

#88

Post by pavel_lishin »

lathiat wrote: post #47
exogeny wrote: post #45

I don't really get the Herbalife defense in here. Here's what I know: The products are of dubious quality, and can be bought for much cheaper elsewhere. The majority of people who end up being distributors absorb a net loss, and given that many already come from financially unstable backgrounds, that loss is particularly painful. The largest sellers in the chain either got in super early, or make more money off of an…

People also tend to lean heavily on their personal social network, which often alienates them from their personal friend base. And has limited supply before the success you do get from that runs out.

And don't forget that you're often not the first one in your network to start peddling this garbage.

My parents did it for awhile, after being turned onto it by another woman in the small town we lived in. But guess what? That same woman was already selling to 90% of our potential customers. Everyone who was going to buy a case of Glister toothpaste already had one sitting in their garage; who were we supposed to sell to?

The answer to the rhetorical question is, nobody. We brushed our teeth with our shitty investment for about a year, then wrote the whole thing off as a failed experiment that luckily didn't bankrupt us.

Re: One Billion Dollars Short, Bill Ackman, and the Siege Of Herbalife (2015)

#89

Post by herbst »

markdown wrote: post #42
coaxial wrote: post #36

Earlier quoted context omitted.

> with rationality on your side, how could you lose? Look at south Africa, multi vitamins, and hiv/aids denialism. It's pretty fascinating, human toll aside.

Or USA and climate change denialism and the anti-vaxers.

Don't forget the natural medicine deniers over there! Just because they have a major bullshit industrie does not mean nature never made good medicine.

(I know I just went full circle)

Re: One Billion Dollars Short, Bill Ackman, and the Siege Of Herbalife (2015)

#90

Post by Overtonwindow »

richardkeller wrote: post #78
coaxial wrote: post #36

Earlier quoted context omitted.

> with rationality on your side, how could you lose? Look at south Africa, multi vitamins, and hiv/aids denialism. It's pretty fascinating, human toll aside.

South Africa is hardly the only country where multivitamins are common. If rationality were the only metric for decision making, I would expect homeopathy to be far less common globally than it is today. As for Aids denialism, South Africa suffers from a case of cultural antiestablishmentism, particularly in the context of Western medicine. Thankfully our government has stepped up in recent years, and actively promot…

Homeopathy is the beloved little black sheep of natural health. I would say half of natural health industry people don't believe in it, know it doesn't work, but they have to go along with it. Otherwise, to admit (as countless studies, and the federal government have done) that homeopathy is completely without merit, would threaten the entire house of cards that natural health is built upon. I remember last year when the FTC announced their enforcement action on homeopathic OTC drugs, there was an unusual silence from the natural health community. Almost a shrug. From the inside it was laughable at the lack of concern for homeopathy's future.
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