Is Matel Stalinist?

[Tyler Durden]

Tim May wrote...

"This is silly, socialist nonsense. I know some of the book buyers at the 
"Borders" store in Santa Cruz (the very one that the "anti-bigness" lefties 
tried to ban from opening in Santa Cruz). Not only do they have a "local 
authors" section which is larger than the similar section at the "local" 
bookstore, but they have a sophisticated system for re-ordering books based 
on sales. If a title sells, they know it. And can order replacements."


Nothing particularly socialist about my original statement. I was trying to 
point out how the knee-jerk mimicry of top-down structures prevented even 
big companies from making as much money as they could, by awarding and 
leveraging local talent and information.  It would be nice to think that 
part of Border's success is from doing some of this. As for the small, 
independent bookstores, I personally helped trounce one in particular...the 
owner was not only a know-it-all DICK he really wasn't a very good 
businessman. He tried to tell his customers that they should want what he 
was selling and it didn't work. (Every now and then I'd try to send a 
customer or two his way to get the kind of books the Central Office wouldn't 
let us carry, and on several occasions the reply was "No thank you, I'm 
never shopping THERE again...").

So I'm not advocating 'requiring' big retail companies to get smarter, nor 
am I advocating non-shopping at the big Borders and Barnes and Nobles. My 
point was that a lot of corporate cultures blindly mimic hierarchies even 
when that's not appropriate, because it just about the only social model 
anyone's ever experienced.


>And being a shareholder in a bunch of non-Silicon Valley companies, I can 
>also assure you that their 'high-level strategic decisons" are NOT "made 
>almost entirely in the vacuum of power."

Well, I'm thinking of the Lucents, Nortels and Alcatels of the world. Oh, 
and all the big old financial houses as well. Those two sectors I can claim 
some decent familiarity with (I too am a shareholder in various companies). 
When Lucent bought Chromatis, or when Sandy Weil told Jack Grubman to uppe 
his rating on AT&T or...well, these major, corporation-shaking decisions 
were pretty much made in a vacuum of power. There's no way shareholders 
could give the thumbs-down to those absurd deals, or even (really) chuck out 
those responsible.

Of course, you'll argue that the shareholders could vote with their feet 
until something was done, but that's besides the point. The point here is 
that shareholders, Boardmembers, and upper management alike are so used to 
an environment where little or no feedback is possible that something like 
this happens so often. I'm not saying "there should be a law"...it's a 
cultural thing, and the culture sucks, because we're used to being told what 
to do by somebody else who's "in charge".


>You silly Bolshies are obviously on the wrong list if you think strong 
>crypto is going to help your cause.


Not so fast my fine, crypto-fascist friend. Let's look at Grubman. At the 
time Sandy Weil gave him his marching orders he probably had (at least) 10s 
of millions of dollars-worth of immature Citigroup options. You can also bet 
he was paying out the friggin WAZOO for whatever upper-east-side space he 
had (as well as whatever East Hampton 'bungalo' he had). So in a way, he was 
on the hook, and stood to make a hell of a lot more on the AT&T deal. So he 
probably didn't really WANT to put lipstick on that pig, but he didn't have 
a lot of choice. (OK, he had plenty of choice, but that's a different 
matter...)

Now let's say some kind of really sophisticated blacknet were available, 
able to support even short-selling and whatnot. In that case Grubman might 
have secretly shorted the AT&T deal and then given Sandy the finger, all the 
while preserving his tattered (but then still-salvagable) reputation as at 
least an "honest" pump-and-dump analyst, while being able to keep himself 
afloat in high-end hookers and other goodies (that's what I would have 
done!).

>From this perspective, crypto would have allowed enough holes to be punched 
in the deal so that real market forces could tear it apart like pirana, 
which is what should have happened.

-TD

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