$1 Billion bet against HerbaLife LOL

by nik0 Banned 20 replies
Read this article:

http://www.nytimes.com/2014/03/10/bu...down.html?_r=0

I'm obvious a great fan of William A. Ackman as I hate those HerbaLife type of businesses that only make their sales cause distributors buy, and not caring whether these buyers even sell. Yes I've been to similar conventions in my younger years where it was all about buying to giving it away for free as samples to find more distributors. What a business model is that.

Agreed, Ackman, is one sneaky guy in how he plays it but the end justifies the means.

That article is a few weeks old, current status:

This year Herbalife's stock price has fallen 24 percent and Ackman's fund has gained roughly 20 percent this year, three investors said on Thursday.

Read more: http://www.businessinsider.com/r-sec...#ixzz30dI8kuQ9

We're on the winning side!
#off topic forum #bet #billion #herbalife #lol
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  • Profile picture of the author Tsnyder
    Originally Posted by nik0 View Post

    Read this article:

    http://www.nytimes.com/2014/03/10/bu...down.html?_r=0

    I'm obvious a great fan of William A. Ackman as I hate those HerbaLife type of businesses that only make their sales cause distributors buy, and not caring whether these buyers even sell. Yes I've been to similar conventions in my younger years where it was all about buying to giving it away for free as samples to find more distributors. What a business model is that.

    Agreed, Ackman, is one sneaky guy in how he plays it but the end justifies the means.

    That article is a few weeks old, current status:

    This year Herbalife's stock price has fallen 24 percent and Ackman's fund has gained roughly 20 percent this year, three investors said on Thursday.

    Read more: SEC Investigates Possible Hedge Fund Collusion Against Bill Ackman's Massive Herbalife Short - Business Insider

    We're on the winning side!
    Please... please... please... invest everything you have in Ackman's
    bet. You'll lose just as he will. Anyone who thinks an article that's a few
    weeks old constitutes current news in the stock market should never be
    taken seriously.

    Ackman is wrong about HLF and so are you. You clearly haven't the first
    clue how Herbalife actually operates.

    Here's what the smart people are saying...

    HLF Stock | Trade-Ideas: Herbalife (HLF) Is Today's Post-Market Leader Stock - TheStreet
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  • Profile picture of the author talfighel
    "investigation of the company"...

    We all know that MLM is protected and has its own laws.

    The FTC tried to take down Amway and network marketing back in the 1970's. We all know who won and we all know that MLM is a legitimate business.
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    • Profile picture of the author nik0
      Banned
      Originally Posted by talfighel View Post

      we all know that MLM is a legitimate business.
      I didn't expect anything else then support for pyramid scheme's on this forum!
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      • Profile picture of the author candoit2
        Originally Posted by nik0 View Post

        I didn't expect anything else then support for pyramid scheme's on this forum!
        Not really, a show of support. You have what 2 people defending it?
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      • Profile picture of the author seasoned
        Originally Posted by nik0 View Post

        I didn't expect anything else then support for pyramid scheme's on this forum!
        Well, some here hate my guts, so I will be the contrarian. AMWAY, herbalife, etc... Are NOT MLM in the way that distributorships, etc... that they compare themselves to!

        They generally say...

        1. We are LEGIT, because everything ELSE is sold on multiple levels! NOT REALLY!
        2. We are LEGIT, because you are promoted based on sales! NOT REALLY!
        3. We are LEGIT, because people closer to the top make more! NOT REALLY!

        OK, OK, so HOW am I saying NOT REALLY?

        Let's compare tide(a popular US detergent sold in the US) to SA8(At least USED to be one of amways leading detergent products, and considered a TIDE replacement)

        1. TIDE is often sold to distributors, corporations, stores. If stores could buy enough, and wanted to do so, they could likely go more direct. I don't believe you can do that on amway. Everyone in the chain makes something even if nothing is sold. With amway, you have to sell, or have people below you sell.

        2. You may not be promoted on sales AT ALL with amway. Several "mlm"s now require you to "recruit" as well. Some of the bigger try to recruit ALL. A sidenote. One person here recruited 100% with HIS product. Because he promissed an income of a certain amount, the FTC shut him down.

        3. People at the top could actually make NOTHING. Amway might be this way now, but some require you to sell to make money even on those below you. A lot of promotion is based on values that have NOTHING to do with sales. Amway is one such place with various values in their product ordering book, and the amount affecting your status is NOT the sales price or cost.

        HECK, I joined a couple "mlm"s on the internet. I actually got a number of other sellers. I didn't sell enough, and lost all. If MLM were as presented, or the traditional model, I would have something. It IS interesting because the company holding ME to these requirements hasn't followed their own advice. If they cancel ME, they get my downline. All clients that roll up to them mean they get the residuals from those sales for LIFE. THEY didn't advertise, or build relationships, or pay any expenses. In fact BOTH of these "MLM"s are primarily, and started out solely as, affiliates.

        Steve
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        • Profile picture of the author SteveJohnson
          Originally Posted by seasoned View Post

          Well, some here hate my guts, so I will be the contrarian. AMWAY, herbalife, etc... Are NOT MLM in the way that distributorships, etc... that they compare themselves to!

          They generally say...

          1. We are LEGIT, because everything ELSE is sold on multiple levels! NOT REALLY!
          2. We are LEGIT, because you are promoted based on sales! NOT REALLY!
          3. We are LEGIT, because people closer to the top make more! NOT REALLY!

          OK, OK, so HOW am I saying NOT REALLY?

          Let's compare tide(a popular US detergent sold in the US) to SA8(At least USED to be one of amways leading detergent products, and considered a TIDE replacement)

          1. TIDE is often sold to distributors, corporations, stores. If stores could buy enough, and wanted to do so, they could likely go more direct. I don't believe you can do that on amway. Everyone in the chain makes something even if nothing is sold. With amway, you have to sell, or have people below you sell.

          2. You may not be promoted on sales AT ALL with amway. Several "mlm"s now require you to "recruit" as well. Some of the bigger try to recruit ALL. A sidenote. One person here recruited 100% with HIS product. Because he promissed an income of a certain amount, the FTC shut him down.

          3. People at the top could actually make NOTHING. Amway might be this way now, but some require you to sell to make money even on those below you. A lot of promotion is based on values that have NOTHING to do with sales. Amway is one such place with various values in their product ordering book, and the amount affecting your status is NOT the sales price or cost.

          HECK, I joined a couple "mlm"s on the internet. I actually got a number of other sellers. I didn't sell enough, and lost all. If MLM were as presented, or the traditional model, I would have something. It IS interesting because the company holding ME to these requirements hasn't followed their own advice. If they cancel ME, they get my downline. All clients that roll up to them mean they get the residuals from those sales for LIFE. THEY didn't advertise, or build relationships, or pay any expenses. In fact BOTH of these "MLM"s are primarily, and started out solely as, affiliates.

          Steve
          Steve, with all due respect, it's obvious you know nothing about how Amway works.

          DISCLAIMER: I am not an Amway distributor. I was, once, a very very long time ago, and did rather well at it. My business imploded for reasons beyond my control, which is one of the reasons I don't like the business model.

          1. If a person develops their business volume to a certain level, they can indeed buy direct from the company. It's called being a 'direct distributor'. If nothing is sold in an organization, no one makes anything.

          2. 'Promotions' (not the correct term or concept, but whatever) occur ONLY on sales volume of the distributor's organization. You are not in any way, shape, or form 'required' to recruit. If you do, you can make more money, but that comes from more sales, not from simply signing people up.

          3. It is indeed possible to make nothing regardless of your 'status'. Actually, that's not entirely true. With Amway, as with many MLM's, your level on the pay scale depends on ongoing qualifications. You can 'get to the top', but you don't stay there if you don't keep producing sales. Requirements to personally sell a certain amount are based on FTC compliance.

          3a. You're correct in that sales volume with Amway is based on a point system, not a dollar value of sales. This keeps the performance requirement consistent regardless of price inflation or deflation. If you had to sell 100 boxes of soap to get to a certain level in 1960, that's how many you have to sell today. Keeps the playing field even.

          4. Amway was set up from the outset as a multi-level marketing company. Rich DeVoss and Jay Van Andel were very accomplished MLM distributors when they started Amway, and that's what their model was based on, with their own improvements and modifications. It is a testament to their intelligence that the Amway pay plan hasn't significantly changed in over 50 years.

          And as for what would be #5, they 'have your downline' regardless of what you do. You 'lost all' probably because you didn't meet company requirements. There definitely ARE (or have been) some shady companies that have manipulated those requirements to avoid paying higher bonuses, but Amway has never been one of them.
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          • Profile picture of the author seasoned
            Originally Posted by SteveJohnson View Post

            Steve, with all due respect, it's obvious you know nothing about how Amway works.
            I haven't been in amway for DECADES! That is why I started talking about other MLMs.

            DISCLAIMER: I am not an Amway distributor. I was, once, a very very long time ago, and did rather well at it. My business imploded for reasons beyond my control, which is one of the reasons I don't like the business model.

            1. If a person develops their business volume to a certain level, they can indeed buy direct from the company. It's called being a 'direct distributor'. If nothing is sold in an organization, no one makes anything.
            Last time I checked, if you didn't sell a certain amount, you DID lose your downline.

            2. 'Promotions' (not the correct term or concept, but whatever) occur ONLY on sales volume of the distributor's organization. You are not in any way, shape, or form 'required' to recruit. If you do, you can make more money, but that comes from more sales, not from simply signing people up.
            Promotions was a general term. Whatever an agency callsit, if the two don't match, you could claim I didn't use the right term. When I spoke of more money, I meant PER SALE(of the same items. A bigger profit margin.)! Perhaps I should have made that clearer.

            3. It is indeed possible to make nothing regardless of your 'status'. Actually, that's not entirely true. With Amway, as with many MLM's, your level on the pay scale depends on ongoing qualifications. You can 'get to the top', but you don't stay there if you don't keep producing sales. Requirements to personally sell a certain amount are based on FTC compliance.
            EXACTLY! FTC compliance or no, the TRADITIONAL model with distributors, corporations, stores doesNOT work that way. If a distributor has 500 accounts, they don't have to do ANYTHING for their entire existence but service those accounts. If they are happy, the distributors keep making money.

            3a. You're correct in that sales volume with Amway is based on a point system, not a dollar value of sales. This keeps the performance requirement consistent regardless of price inflation or deflation. If you had to sell 100 boxes of soap to get to a certain level in 1960, that's how many you have to sell today. Keeps the playing field even.
            Well, as I recall, it did NOT fit such a pattern. It wasn't to offset inflation on the cost or sale.

            4. Amway was set up from the outset as a multi-level marketing company. Rich DeVoss and Jay Van Andel were very accomplished MLM distributors when they started Amway, and that's what their model was based on, with their own improvements and modifications. It is a testament to their intelligence that the Amway pay plan hasn't significantly changed in over 50 years.
            It changed a bit while I was in it. Part of that was due to a bunch of lawsuits triggering FTC requirements, like you alluded to earlier. Before that, MANY tried to recruit EVERYONE! The new plan wouldn't allow that.

            And as for what would be #5, they 'have your downline' regardless of what you do. You 'lost all' probably because you didn't meet company requirements. There definitely ARE (or have been) some shady companies that have manipulated those requirements to avoid paying higher bonuses, but Amway has never been one of them.
            EXACTLY!

            I don't think we are saying things that are that different. You even CONFIRMED key points. You still made my case!

            Steve
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  • Profile picture of the author Tsnyder
    By the way... legendary billionaire investor Carl Icahn also
    disagrees with Ackman. He took an enormous position in the
    stock and currently several of his investors have taken seats
    on the Herbalife BOD.

    Any rookie investor knows that when a short seller decides
    to blast you for his own future gains the stock will decrease
    sharply on a temporary basis. HLF is doing just fine at this
    point.
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    • Profile picture of the author DWolfe
      Originally Posted by Tsnyder View Post

      when a short seller decides to blast you for his own future gains the stock will decrease sharply on a temporary basis..
      What is sad the short sellers damage business and cost them money. Worst off is some one is holding stock in a company and the stock gets shorted. The value goes down the stocker holder looses money.

      No one considers that some people maybe using a stock in their IRA. The short sellers make a fortune while the shareholder looses equity.
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      • Profile picture of the author Tsnyder
        Originally Posted by DWolfe View Post

        What is sad the short sellers damage business and cost them money. Worst off is some one is holding stock in a company and the stock gets shorted. The value goes down the stocker holder looses money.

        No one considers that some people maybe using a stock in their IRA. The short sellers make a fortune while the shareholder looses equity.
        When you'rethe victim of a short seller you just have
        to hold on. You don't lose until you sell. The short seller
        will have his fun and the stock will rise again.

        Ackman is taking this to the extreme... he actually thinks he
        can drive a multi-billion dollar company out of business.

        At some point he will be held accountable as his bet fails
        and his investors want answers.
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        • Profile picture of the author whateverpedia
          Originally Posted by Tsnyder View Post

          snip
          Originally Posted by Tsnyder View Post

          snip
          Originally Posted by Tsnyder View Post

          snip
          In order to take your posts seriously the following questions need to answered:

          1) Are you involved in Herbalife directly or indirectly?
          2) Do you (directly or indirectly) own Herbalife shares?

          I'm not doubting your integrity, but if the answer to either or both of those questions is "Yes", you need to disclose your interest.

          Please note Steve Johnson's "disclaimer" for reference.
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          • Profile picture of the author nik0
            Banned
            Another hedge fund manager on his side, here a few words he spoke.

            “The best companies to short involve fraud, fads, and failures–this company fits all three,” Marolia said.

            Herbalife Ltd. (HLF): Nothing But 'Snake Oil,' Says Regal Point



            Also turns out Icahn only got involved in Herbalife to settle an old issue with Ackman and not so much cause he believes HBL is legit.
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            • Profile picture of the author seasoned
              Originally Posted by nik0 View Post

              Another hedge fund manager on his side, here a few words he spoke.

              “The best companies to short involve fraud, fads, and failures–this company fits all three,” Marolia said.

              Herbalife Ltd. (HLF): Nothing But 'Snake Oil,' Says Regal Point



              Also turns out Icahn only got involved in Herbalife to settle an old issue with Ackman and not so much cause he believes HBL is legit.
              Well, I don't know enough about herbalife to say whether the price is ok, or to know what the key products are, but I checked out a couple products. They weren't anything special, but they weren't snake oil.

              Steve
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              • Profile picture of the author nik0
                Banned
                Originally Posted by seasoned View Post

                Well, I don't know enough about herbalife to say whether the price is ok, or to know what the key products are, but I checked out a couple products. They weren't anything special, but they weren't snake oil.

                Steve
                I don't think he meant the actual products.

                And no I don't think they sell snake oil
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                • Profile picture of the author seasoned
                  Originally Posted by nik0 View Post

                  I don't think he meant the actual products.

                  And no I don't think they sell snake oil
                  Just to be clear here, since some sometimes think I am being SO literal on things that they should know I am not, snake oil hasn't been literal for like 100+ years. Snake oil is an old american term basically meaning something that is shown as having some drug like(In the full english meaning of the term) action, but has no real legitimate effect. And that is how I use the term.

                  Basically it is a placebo sold to make money with claims to fix a real concern.

                  And yeah, few companies are likely to sell real snake oil for anything, but certainly not to be taken internally.

                  One item I looked at, for example, was an electrolyte drink. It would be good for that. If it were just koolaid, I would have considered THAT snakeoil. It isn't that koolaid is bad, it just won't replace electrolytes.

                  Steve
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                  • Profile picture of the author nik0
                    Banned
                    Originally Posted by seasoned View Post

                    Just to be clear here, since some sometimes think I am being SO literal on things that they should know I am not, snake oil hasn't been literal for like 100+ years. Snake oil is an old american term basically meaning something that is shown as having some drug like(In the full english meaning of the term) action, but has no real legitimate effect. And that is how I use the term.

                    Basically it is a placebo sold to make money with claims to fix a real concern.

                    And yeah, few companies are likely to sell real snake oil for anything, but certainly not to be taken internally.

                    One item I looked at, for example, was an electrolyte drink. It would be good for that. If it were just koolaid, I would have considered THAT snakeoil. It isn't that koolaid is bad, it just won't replace electrolytes.

                    Steve
                    Herbalife's main product is selling golden mountains that are almost impossible to achieve, that's my definition of snake oil sales man.
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    • Profile picture of the author nik0
      Banned
      Originally Posted by Tsnyder View Post

      By the way... legendary billionaire investor Carl Icahn also
      disagrees with Ackman. He took an enormous position in the
      stock and currently several of his investors have taken seats
      on the Herbalife BOD.

      Any rookie investor knows that when a short seller decides
      to blast you for his own future gains the stock will decrease
      sharply on a temporary basis. HLF is doing just fine at this
      point.
      He's a little unlucky that Icahn got involved, without him he would've screwed Herbalife.
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  • Profile picture of the author bezzaton
    Hahahahahaha. This actually made me laugh out loud.
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  • Profile picture of the author ADVERTHEORY
    If I invested allot to short a stock, I'd badmouth it also.

    hire some writers, probably use every grayhat trick to rank the articles, cash out when I think the negative PR has bottomed the stock and profit, then parlay it and go long

    Personally, Id never invest in herbalife, don't care for their business model
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  • Profile picture of the author MachoMadness
    Real pity the late great Jim Rohn threw his lot in with HerbalLife

    His early talks where amazing motivators
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