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Saturday, December 22

House Of Cards



The chairman of Overstock.com (Patrick Byrne) tells it like it is on CNBC. Apparently Overstock does well during bad times. This is not what they want to hear.

Note first the global warming reference as to why Overstock benefited this season by having current merchandise, and then note how he speaks of our economy as a "House of Cards." Oh my! Not on CNBC. Stay cheery! Stay Cheery!

Notice how the hosts of the program do not like such a gloomy outlook on the economy and how they change the subject. It's almost as if it's their job to keep shoring up the cards: "but our life style is so improved....I mean, we've built BILLIONS of new buildings."

Now check out his interview with Fox earlier this month and how he stuns the host:
KEENAN: You know, your stock has held up pretty — you are smiling, because it has had a rough couple months, but compared to Wal-Mart, which has flatlined this year, your stock has done pretty well. How come?

BYRNE: Well, we're up about 50 percent for the year.

(CROSSTALK)

KEENAN: Yes, that's pretty well.

BYRNE: I never try to figure out too closely what is driving the stock. I think there's actually a lot of games and manipulations being played in the stock — and, actually, I never encourage people to buy it, because I think it's heavily manipulated.

[...]
KEENAN: Also want to ask you about what is going on in the mortgage market, and we have seen a lot of record, indeed, foreclosures, people cutting back.

And I know that you sell a lot of items for the home. Have they been weaker than your other products?

BYRNE: Actually, no. I do think that our furniture business is fantastic.

KEENAN: Really?

BYRNE: Great corner of our business.

I do think that we are in — I have been saying for about two years we're looking at a 1929 kind of event. I think that we are really in trouble in this country. And what you have seen in the last four months is just the beginning of it.

KEENAN: Wow.

BYRNE: The government has been keeping the economy afloat with flooding us with cheap money. And those days are over. The dollar is cracking. Eventually, they are either going to they have to defend it by raising interest rates or something. But we're looking at a very bad economic situation.

(CROSSTALK)

KEENAN: But, so far, you are not seeing it. But, of course, you would probably be the last place to see it, since you are selling such discounted items.

BYRNE: If anything, we are counter-cyclical. In good times, it is — we have — it's toughest to get overstock. In bad times is when, suddenly, everybody is calling us to unload product.

The rich people, according to my sources, are preparing for a huge downturn in the economy and preparing to bail on their investments, which means that I too will be bailing, digging a hole and drawing a treasure map.

hat tip to farang for the video

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