Ugliness

The shares of Nikola Corporation (NASDAQ: NKLA), thought to be a Tesla (NASDAQ: TSLA) killer, shot up a couple of days ago on news that Nikola had cut a deal with General Motors. This was very painful for the many speculators who had sold Nikola stock short.

Yesterday, Hindenberg Research — a simply spectacular name for a short-side research firm — published a scathing and, it must be said, hilarious report with an awesome title: “Nikola: How to Parlay An Ocean of Lies Into a Partnership With the Largest Auto OEM in America.” There’s a lot of great stuff in there, for those of you who enjoy that sort of thing. Nikola’s founder, Trevor Milton, comes in for some, er, arresting allegations. The authors make him sound like the Elizabeth Holmes of his industry, for those of you who chortled over the Theranos saga.

Regardless, Nikola responded this morning with a press release that purports to “refute” Hindenberg’s rather detailed allegations. It actually does no such thing, other than to deny them wholesale and to announce that the company had purchased the services of the big law firm Kirkland & Ellis LLP. Nikola also promises to “bring the actions of the activist short-seller, together with evidence and documentation, to the attention of the U.S. Securities and Exchange Commission.”

Oooh. Hindenberg must be quaking in its Cole Haans.

This is, of course, the worst possible response to a short attack. In addition to activating the Streisand Effect, Nikola and poor Trevor — we refer to these electric car dudes by their first name, apparently — have only persuaded the normal reader that the short claims must be true, or substantially so.

So what should Nikola have done? Well, we have some experience in this realm, including a first response, 25 years ago, along the lines of the Nikola “refutation” and the retention of a scary law firm. Driven as it was by the founder’s ego and our own youth and inexperience, the Nikola approach didn’t work, and it only made the public relations problem worse.

Our advice to companies under short attack consists of the following precepts:

• Never let them see you sweat, because they will think they are on to something. The company’s line at all times should be “we will prove our value by executing and delivering on our commitments.”
• Respond to alleged facts with factual responses in an appropriate forum after considered deliberation.
• Skip the big legal threats. The First Amendment protects analytical research, and short sellers usually write their reports with a smooth sophistication that sustains their 1A defense.
• The board should consider hiring Big Law not to threaten, but to do an “independent investigation” of the allegations, and promise transparency.
• Finally, remember that the only people who absolutely must buy your stock some day are short sellers. The smart executive smiles and answers their questions just as if they were supportive longs. Calm execution and confident humility will rattle the shorts back.

Of course, this excellent advice — trust us, we’re right — is not even slightly useful if your company actually is a steaming pile of fraud.

We’re sitting in Newark Airport after a long five days, and it is definitely time for Ugly Linkage. Please remain calm.

She Who Must Be Obeyed Is Not Trump may be poised, careful in her choice of words, and completely free of animosity toward Mexican-American judges, but she has a lot of explaining to do even according to Salon:

Among all the rivers of money that have flowed to the Clinton family, one seems to raise the biggest national security questions of all: the stream of cash that came from 20 foreign governments who relied on weapons export approvals from Hillary Clinton’s State Department.

Federal law designates the secretary of state as “responsible for the continuous supervision and general direction of sales” of arms, military hardware and services to foreign countries. In practice, that meant that Clinton was charged with rejecting or approving weapons deals — and when it came to Clinton Foundation donors, Hillary Clinton’s State Department did a whole lot of approving.

While Clinton was secretary of state, her department approved $165 billion worth of commercial arms sales to Clinton Foundation donors. That figure from Clinton’s three full fiscal years in office is almost double the value of arms sales to those countries during the same period of President George W. Bush’s second term.

Hillary’s defense: “One or two” donations “may have slipped through the cracks.” We shit you not.
All of which reminds of this beautiful Austin moment:

Credit: Somebody random on Facebook.

Speaking of which, egads:

We asked Americans to describe the candidates in one word… and, um… https://t.co/S1RN62fpFA via @aedwardslevy pic.twitter.com/uDttmkDnwj

— Sam Stein (@samsteinhp) June 8, 2016

We increasingly believe that when it comes down to it, so to speak, we will #FeelTheJohnson (if you search that on Twitter, by the way, your results will be surprisingly clean and uplifting…).

As others have said, Troll Level: Grandmaster.

Also from Glenn, the “most epic correction of the decade.” No, really. It makes one wonder why we allow our tax money to go to social science research at all.

As a Cubs fan, we are not happy to see hype like this:

This year's Cubs might be better than the incredible '27 Yankees: https://t.co/jmPUmmeMdX pic.twitter.com/4HZHuP1rQl

— FiveThirtyEight (@FiveThirtyEight) June 8, 2016

We also note that the ’27 Yankees really did not become the ’27 Yankees until well in to the summer of that year. (No, we are not “the baseball guy,” but we did read listen to Bill Bryson’s awesome book “One Summer: America, 1927”, which we recommend without reservation.)

That is all.

From the web site of the Austin Independent School District, a self-beclowning typo…

We flirted with clicking through the link to complain about it — sort of a meta complaint — but then thought better of entangling with school cops, who as a class are not known for their happy-go-lucky approach to sarcasm. Who knows what crazy zero tolerance policy we might run afoul of?

Ugly linkage disclaimer here.

For the last two years, one or more bags of douche have been throwing rocks down on cars from bridges or elevated positions over Interstate 35 in Austin. More than eighty vehicles have been hit, and five people have been injured only in the last month. The police have not caught anybody, notwithstanding lots of high tech surveillance and political pressure. Regardless, if they do catch a rock-thrower it would seem that stoning would be the right punishment. Yeah, we hate to borrow from Islamic law as much as the next person, but if we don’t deter these bastards quickly it will become a thing, like graffiti and cutting, and that will suck large.

Austin’s government has imposed a moratorium on new street events in downtown Austin because congestion, or something like that. The moratorium is now set to expire, and the city is surveying its peeps to see if they support an extension. We love street events so our opposition to the street-event moratorium is self-interested, but there is a bigger issue at stake. The moratorium freezes the status quo, privileging — we used that word just to troll the lefties — incumbent events and denying access to newcomers. This strikes us as very much of a piece with killing Uber and Lyft by regulation or clamping down on short-term rentals. Austin’s current city government just loves the status quo. Don’t they realize that will kill the goose the lays the golden eggs?

The Austin cops arrested an activist who was filming them on dirty 6th. Allegedly, the dude was too close. We struggle with cases such as these, because we are a First Amendment absolutist, or as close as one can reasonably get without being a complete lunatic, and we are not big fans of either police or activists. Both have a strong busybody streak, and we do not like busybodies.

Surprising exactly nobody who is not an economic retard, black market ridesharing has popped up to replace Uber and Lyft, which famously quit Austin after voters sustained onerous regulations imposed by the city council. So reasonable regulation and corporate oversight is now eclipsed by no oversight. But we got international humiliation out of it so that’s something.

While the “Texas beer economy is booming,” the Lone Star State ranks only 42nd for breweries per capita. Thankfully, “we’re far from saturated,” or so the article says.

We all know that ridesharing apps allow for the rating of both drivers and passengers, which system inherently disciplines the behavior of both. Along comes this idea for flying, which I would get behind. Especially if the voting power were amplified according to frequent flyer status.

Instead of the TSA, how about a pre-flight touchscreen app to vote other passengers off the plane?

— David Burge (@iowahawkblog) May 17, 2016

This would be very bad news for extremely fat people in my row.

You guys know the drill.

Allegedly, unnamed “Republicans” have approached Mark Cuban about taking on Donald Trump in a third-party bid. This might be a case of learning a lesson too well. Regardless, the only third party bid that matters is one that can take a state or two and throw the election in the House. And if you don’t follow that last point, go read the very clear text of the 12th Amendment and hope for salvation.

Public health experts from Hahvahd strongly advise that Brazil cancel the Olympics because Zika. We know a little bit about public health, and agree with the recommendation. The rationale in the linked article, however, pains us because it in part rests on chattering class moralizing:

Dr. Richard E. Besser, ABC News’s chief health and medical editor, highlighted five things that report author Amir Attaran identifies in defense of such a drastic recommendation: Rio’s proximity to the disease; the dangers associated with this particular strain; the increase in tourism that will risk spreading the Zika virus to other countries; the short amount of time health officials will have to develop control measures; and, finally, what Attaran calls the irresponsibility in placing sports above public health. (Emphasis added.)

Two observations. First, our Western notions of individual rights really date from the antibiotic era. This is no coincidence, because fighting infectious disease involves the elevation of collective interests over the individual. If antibiotics fail or lethal viruses emerge in the West, expect to see us retreat from individual rights. It will take time and plenty of litigation, but it will happen. You read it here first.

Second, since when don’t we “place sports above public health”? Anybody look at the injury rates in football, the social consequences of poor kids chasing the dream of the NBA, the environmental impact of golf courses, or the public health consequences of lying around drinking beer and watching sports on TV? We all put sports above public health, and that is just as well, too. Maximizing life span is not the highest value, or ought not be.

This is apparently real:

Retweeted . (@DBN_clay):

This is legit.. pic.twitter.com/BiQyvuahhM https://t.co/6OxriUOfA3

— Danielle Kenyon (@drkenyon) May 15, 2016

Question authority, and resist stereotypes.

Who could have seen this coming?

Many downtown goers left stranded after first weekend without Uber and Lyft https://t.co/5SzJhveEkz pic.twitter.com/vLvOl392BG

— FOX 7 Austin (@fox7austin) May 15, 2016

Besides everyone, we mean. Remember, when a consequence is not only predictable but predicted, it is not unintentional. Punch back twice as hard.

Really revolting people shaking down small businesses in the name of social justice. The combination of virtue-signaling and greed is especially despicable. Don’t invite these people to cocktail parties.

Live free or die.

We are jealous of our secret identity for many reasons, among them that we often laugh when it is wholly “inappropriate” — we believe that is the word — to do. Please do not condemn us for this. We bet that you also have some ugly vice that you are ashamed of.

Herewith, the evening’s ugly linkage.

So, this absolutely has to be the most laugh-out-loud correction to appear in the New York Times since, well, the invention of corrections.

That, ladies and germs, ain’t a mere typo. Shakespearean as it may be, no cube farm full of monkeys, or Grey Lady interns, could have come up with that randomly banging on their keyboards. The New York Times must have accidentally hired somebody with a great sense of humor and a poor handle on office politics. As so often happens.

New York City has joined San Francisco and Austin in restricting plastic grocery bags. New York has merely required retailers to charge a fee instead of imposing an outright ban, which is just as well considering this handy bit of news:

A whopping 97 percent of consumers don’t regularly wash their bags, according to a report from the University of Arizona and Loma Linda University. Their researchers swabbed 84 bags for bacteria, and the findings were outright nasty: coliform bacteria in half, E. coli in 12 percent.

When San Francisco banned plastic bags, the number of E. coli infections spiked. Even worse, the number of foodborne-illness deaths rose a whopping 46 percent in the three months after the bag ban began.

We wonder if anybody has done a similar study in Austin, which banned disposable bags in 2013. We did find this report, which found that Austin’s law has not — be sure you are sitting down — produced the expected environmental benefits because of “unintended” consequences. Uh, if a consequence is obvious to a normal person, by which we do not mean a “progressive” activist, it cannot be said to be unintended.

This is totally harsh. But funny.

@realDenaldTrump pic.twitter.com/B9oOfSeWbb

— Ursa (@Ursanacha) May 11, 2016

Context here.

If we needed more evidence that populism of the left and right are not really very different, the prosecution should rest on this bit of polling data: Over four in 10 Sanders voters in West Virginia would vote for Trump. To be fair, these are West Virginian Sanders voters, which are probably not yer usual Sandersnistas, but still…

A couple of San Francisco cops beat the hell out of a suspect for no obvious reason, and the whole thing is caught on surveillance cameras. Video here. The beaten suspect is named “Petrov” and the vicious cop on point rejoices in the name of Luis Santamaria, so the usual narrative fails, but here is my question: How is it that it does not occur to cops in San Francisco in 2016 that they might get caught because, you know, cameras everywhere? Setting aside Santamaria’s apparently defective character, how do you give somebody that transportingly stupid a state-sanctioned monopoly on the lawful use of force?

In the hunt for this suspect, don’t bother checking the dental records.

We can’t decide whether this is more weird than cool, or the reverse.
That is all.