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08-Feb-2006
A Hagiography, by Victor Niederhoffer

The Google Story by David A. Vise and Mark Malseed, is replete with the kind of sentiments usually reserved for the Sage.  'The staff eats for free in a dining room that used to be run by a former chef for the Grateful Dead" and "Even as it rides high, Google wrestles with difficult choices that will enable it to continue expanding while sustaining the guiding vision of the Founder's mantra 'Don't Be Evil'". No wonder the authors, a Washington Post type collaboration, had "Extraordinary Access" to do their "Scrupulous Research" on the firm.

Three vignettes call out for comment. Sergei Brin's father, Michael, devoted all his time in the Soviet Union before coming here to proving that "Russian Living Standards were better than America". The two founders, Sergei and Larry entered a Ph.D. program at Stanford where the President sought to encourage risk taking and entrepreneurship and allowed the profs to keep the financial rewards of being adjacent to Silicone Valley, and allowed the students to work on "potential commercial ventures using university resources". This led to a most amusing situation. All the students shared office space in the "William Gates Computer Sciences " building. One Sunday morning another student entrepreneur Ms. Tamara Munzner remembers at 3 a.m. in the morning "the offices were full. We are such geeks."

The three incidents are related in that incentives and the profit motive provided the framework and trophies to induce the founders to form this colossus that has revolutionized the information retrieval business and now carried a market value higher not only than Disney and General Motors combined as the book jacket notes, but at 108.7 billion is within a hair breath of Intel's at 124. 6 billion, and ranks 4th in the Nasdaq 100 behind Microsoft, Apple and Intel.

P.S. While it has nothing to do with this post, and of 1000 posts here, I doubt that I've mentioned an individual stock more than twice, except in the context of a scientific study, or a pasting of hubristic Sageology, and my normal business has nothing whatsoever to do with individual stocks, I mention that a former wife does hold Google and I was reading the book to see why her performance was so much better than mine. However, like everyone else, I occasionally don't put all my spare money into index funds and own a stock or two. Just as a coincidence , and having nothing to do with this post, I put some statistics on the table concerning the performance of companies that have registered comparable declines to Google's last week, and have a long position in Google . Also as a coincidence, I once read a hagiography of the training methods and wisdom of Jim Currier, a good baseline tennis player from the past who liked to put his money into Intel when it was being beaten into smithereens, and remembering that I recently went long Intel.

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