Mark Cuban

I've probably written about it a few times in various comments, but the essence of it can be found here:

http://blogmaverick.com/2010/08/20/the-stock-market-is-still-for-suckers-and-why-you-should-put-your-money-in-the-bank/

and here:

http://blogmaverick.com/2008/09/08/talking-stocks-and-money/

(I don't always agree with Mark Cuban, but most of what he says here seems pretty sensible).

As far as investing goes, I always seemed to be pretty "good" - or at least, lucky. It was not unusual for me to make a few thousand dollars in a week (and occasionally lose a little). I typically never invested in very risky prospects, always things that I knew would be around for quite a while like Google and Apple.

I made the foolish mistake of investing in Freddie Mac and Fannie Mae, companies that were once labeled "too big to fail" (and now trade OTC, if at all - have not checked since they became junk). Actually, my "mistake" appeared to be a brilliant move at first, as I made $30,000 in a few hours. But in a few more hours, that number was negative. However, I was not investing out of speculation, I invested because I thought that these companies were going to survive the recession - in fact, because of a statement from Hank Paulson (then Secretary of Treasury) who said that the government would not be taking over these entities (they were GSEs, but publicly traded). Hours later rumors turned against this, and within weeks it was trading at $0.25 or less (down from $7 to…

Very good advice, but I'll also recommend you educate yourself further. Take 90k and save it, it is easy to burn money on a business. -
read: http://www.paulgraham.com/selfindulgence.html

Also read following:

Read
Getting Real ( http://gettingreal.37signals.com ) - By 37signals
Rework ( http://37signals.com/rework/ )
37signals blog seris - bootstrapped, profitable & proud
( http://37signals.com/svn/posts/2937-every-bootstrapped-profitable-proud-in-one-place )

Read
Start Small, Stay Small ( http://www.startupbook.net ) by Rob Walling
http://www.softwarebyrob.com/ - He also has a great blog

Read
http://www.jamesaltucher.com/2012/01/the-10-keys-to-selling-anything/
http://www.jamesaltucher.com/2011/04/the-100-rules-for-being-an-entrepreneur/

Read
The Lean Startup by Eric Ries
http://www.startuplessonslearned.com/ - Eric Ries blog

Read
How to win at the sport of Business by Mark Cuban
his blog : http://blogmaverick.com/

Also keep in mind, most great products / services are not revolutionary but evolutionary. Google, Facebook both improved on existing ideas, Apple's ipod was not an original Apple idea/tech either : http://www.dailymail.co.uk/news/article-1053152/Apple-admit-Briton-DID-invent-iPod-hes-getting-money.html

The Patent system isn't that bad, it's just a little broken; the issue is the application. If the main requirements were more thoroughly followed and processed (the idea of inventing something new, useful, etc) there wouldn't be a problem.

Abolishing the system would in my opinion do a lot of harm--as right now it is not beyond repair.

Just spit-balling here but I'd like to see (and I encourage others to do the same because that's how answers are found, so even if they are a bit dumb (just look at mine haha) share them because maybe they'll lead to something):

- Tech specialists/historians should be more entrenched within the patent office

- Shorter patent terms

- Jury/Panel of peers? Haha, sounds dumb but maybe in the process everyday people are put through a short explanation of the product and if at the end of the explanation someone goes, "that kind of sounds like such and such" the process is stopped and investigated.

Mark Cuban had some interesting ideas on blogmaverick too,
http://blogmaverick.com/2011/08/07/my-suggestion-on-patent-law/

I guess the good thing about this situation is that it has people talking.

Mark Cuban bemoans the good old days like any technical trader before they were beaten out by computers. He doesn't advocate trading on fundamentals. The battle cry against high frequency tradings seems to come primarily from individuals who were previously successful in specialist trading.

Here he talks about how he bought a stock, watched it climb then shorted it and celebrated its bankruptcy: http://blogmaverick.com/2008/09/08/talking-stocks-and-money/

But yes, speak to us from the moral high ground. Cuban simply rode what essentially amounted to a pump-n-dump. He wasn't doing the promotion, but he sure as hell wasn't in it for the long term growth of the underlying company.

Here's a fantastic quote from Mr. Cuban: "What about fundamentals? Fundamentals is a word invented by sellers to find buyers.

Price-earnings ratios, price-sales, the present value of future cash flows, pick one. Fundamentals are merely metrics created to help stockbrokers sell stocks, and to give buyers reassurance when buying stocks. Even how profits are calculated is manipulated to give confidence to buyers."

I'd respectfully disagree. The original context of Cuban's advice is here:

http://blogmaverick.com/2012/03/18/dont-follow-your-passion-follow-your-effort/

..and an especially relevant excerpt related to your comment:

"Why? Because everyone is passionate about something... ... [things] that we really really want to do with our lives. Those passions aren’t worth a nickel."

His overall point is that instead of blindly following after your passions and "hoping" things will work out, you should count on effort and hard work.

Technically, you're right - Cuban wasn't talking about specifically picking an eCommerce niche. But he does make the great point that if you're successful at something - regardless of what it is - you usually become passionate about it.

The problem faced by many new entrepreneurs is that their passion-based business plan doesn't get traction, and they give up. But if you start with a effort and market based business plan, a new entrepreneur is much more likely to succeed. And when they're successful with their business, they'll become very passionate about it.

My favorite posts and sites:

Mark Cuban's post on stocks:
http://blogmaverick.com/2008/09/08/talking-stocks-and-money/

A blog of a hedge fund trader in Japan:
http://nihoncassandra.blogspot.com

A blog of a hedge fund trader in London:
http://macro-man.blogspot.com/

Reminices of a stock operator - written in the 1920's, everything he says still applies today.

If you really want to understand both the economy and stocks, try doing this search in google:
site:blogs.cfr.org/setser/ mencius moldbug
and read every comment by Mencius.

Finally, I recommend a short comment I made about stocks and investing here: http://www.newmogul.com/item?id=2587

I was a huge fan of the book "A Random Walk Down Wall St" when I first read it. But now I believe that it is seriously misguided. The stock market is a far different beast than it was in 1970.