eStrategy Partners

How to Be Smarter Than The News Media

noreply@blogger.com (Jeff Cohn) — Wed, 08 Feb 2012 00:04:00 +0000

Financial & Political News Media

Most smart people know that the mainstream media is controlled by huge companies at the highest level and they are simply puppets and not news reporters any longer. The majority of what we hear is not news but simply filtered PR and sensation stories that have filtered their way to the top of the pile in social media. If you take the time to read these blogs daily below, it will guarantee you to become smarter about interpreting the mainstream liberal news.

Social media is merely a representation of what is popular and not necessarily what is important. This drives news reports to talk about stupid things that any normal intelligent person would just ignore as a waste of time. Bloggers have taken over the role of reporting the news in finance, economics and politics. Bloggers do the best job of dissecting and interpreting the mainstream liberal media news, which is very hard to do. Some bloggers are reckless about not checking facts but information does have a way of getting filtered out eventually.

Here are the best blogger news sources I read that help support my conservative views about politics, economy and finance. I read them daily because the mainstream news is typically old, non-original and derived from blogger sources. At the same time it is virtually impossible in depth coverage of to get quality news coverage from NBC, CBS, ABC and even Fox. You can also follow this list on Twitter at Smarter Political News. Here are two other Twitter lists I am building that do a good job of interpreting the biased financial press and technology news. Smarter Tech News Smarter Financial News

Facebook's IPO Valuation Should Be $25B

noreply@blogger.com (Jeff Cohn) — Tue, 31 Jan 2012 23:34:00 +0000

I would like to take you through a simple math equation for determining the fair value of Facebook before its IPO filing tomorrow without comparing growth metrics. Here are my assumptions when comparing Facebook, while using Google as the benchmark. Google's annual revenue is $37 billion with a market capitalization of $188 billion currently as of January, 31, 2012.

Google's annual display ad revenue from Double Click is only $5 billion + they have $32 billion of additional revenue sources. That means if Google only had the display ad business similar to Facebook their valuation would be 1/8 or less or around $25B. Here is the scary part when you start to look at Facebook's proposed IPO valuation of $100B with 88% of its revenue coming from one source.

Facebook simple valuation equation based on current estimates:

Google Market Cap = $188B at $580 per share
Google Total Annual Revenue = $37B
Google Display Ad Revenue = $5B

Facebook Market Cap = $100B
Facebook Total Annual Revenue = $5
Facebook Display Ad Revenue = $4.8
Facebook Fair Value Equation = ($37 / $5 = .135) x $188 = $25B

The latest news sources reported that Facebook annual display ad revenues were around $3.8B in 2011 and so I will assume this revenue number has grown to $5B in 2012. $5B in annual revenue for Facebook is 1/8 the the size of Google's with $37B. Facebook has 88% of its revenue coming from display ads only which is not very diversified if you ask me. Keep in mind this does not factor in growth rates but they cannot be that dramatic to change my valuation estimates.

S&P Low 666 (2009) x 2 = High 1332 (2012)

noreply@blogger.com (Jeff Cohn) — Tue, 31 Jan 2012 17:03:00 +0000

S&P Low in 2009 of 666 x 2 = 1332 High in 2012

The rigged stock market will undoubtedly become a key issue in the 2012 Presidential race. The Obama administration will promote the fact that the stock market is up almost 100% since he took office in 2008. Mitt Romney is going to attack the fact that the market is up 100% but so is the unemployment rate that went from 5% to 10%. Pick your poison. The Federal Reserve's balance sheet is bloated and helped to rig the stock and bond market game. How will it end in the next few years and what is the best path to long term free market prosperity and organic economic growth in the U.S.?

The stock market has become a rigged game in the last few years. It is be propped up by the Federal Reserve and Ben Bernanke's team by printing unlimited dollars to buy futures and bonds in the open market. Bond prices are artificially low in order to encourage people spend and not save. However, the smart people running big corporations are sitting on hoards of cash earning 0%. Its because the market has been propped up in a phony way and there is no organic growth. Executives are expecting a stock market crash of grand proportion that will wipe out all of the Government businesses that have been propped up. Cash will be king in the future and there will be no safe havens. Its just a matter of time before the huge "House of Cards" bonds and stocks all fall at the same time wiping out the wealth that has been artificially created.

Yes, the United States can print endless amounts of money in order to create inflation and promote growth. The experts think we can grow our way out of the debt crisis and reduce the current 100% debt to GDP ratio that has doubled under the Obama administration. However, the austerity in Europe is nothing compared to what we might see in the U.S. if Mitt Romney gets elected and the Federal Reserve money printing press is halted. It will be painful in the short term but the long term gain for my kids and grandchildren will be tremendous. The U.S. Government must feel the pain of overspending and let the free markets take over their bloated and egregious spending habits. Don't forget Mitt Romney has been a private equity / restructuring guy in the private sector and will have the biggest turnaround project of all time on his hands once he pulls the Fed plug.

Mitt Romney knows that a healthy economy will grow through organic investment and capitalism at the local level. In healthily economies the Venture Capital & Private Equity industries thrive and so do quality IPO's that foster the cycle of wealth that has built the foundation of the United States. However, the recent financial crisis has led the Government to step in and act as the market "Big Brother" to prevent big investors from losing money. The VC industry and private equity industries are shrinking drastically because large LP's (limited partners) have no incentive to invest with below 0% annual returns due to overbearing Government regulations. We all know in healthy free markets there are winners and losers. However, now the losers are being prevented from losing and this is not capitalism. Bailouts have been preventing huge bankruptcies and progress towards creating new and more efficient businesses.

Thousands of banks should have gone out of business and so should have many of the auto companies like General Motors. Restructuring and bankruptcies are all part of the free market cycle and we have yet to go through it on a large scale downturn. The 2009 downturn was prevented by the Government by double its debt load in the trillions and now the next recession could be even worse and deeper.

In summary the only thing that is going to help the economy in the long run build a foundation of growth that is sustainable is if the Government simply gets out of the way. We investors are all "Big Boys" and taking loses is part of the game. Trying to impose regulations on the financial services industry to prevent loses only restricts the free market capital flows and prevents investors from doing anything. We need investors to be excited about investing and now restricted. These two bills / laws need to be repealed by the next President and then you will see healthy organic investment growth come back to the private sector.

1) Repeal Sarbanes Oxley
2) Repeal Dodd Frank Bill

Should US Government Spending Crash Like the Stock Market?

noreply@blogger.com (Jeff Cohn) — Tue, 18 Oct 2011 23:43:00 +0000

Thanks to Marry Meeker for putting out this slide on her latest Awesome Web 2.0 presentation about the "State of the Web". This slide struck me the most as a concern for investing in the future of technology. Until the US Government cuts spending by 50% and gets out of the private sector way we are going to be in stagnant economy for a long time. This slide is telling me a few things need to happen before our economy has even a chance of turning around. In Wallstreet terms, I think we need the great capitulation of Government spending in order to right the private sector economy. I will not get too excited about private sector investing until the following questions are answered . . .

Should US Government spending crash like the stock market?
Will industries that rely on Government spending be crushed?
Has the Federal Reserve lost all credibility with the markets?
The VC industry shrunk by 80% in the last decade so why not the Government?
Rising interest rates might actually be good for the "real economy"?
Are currency wars are going to get even more intense?
Is the US the new emerging market carrying highest investment risk?
Where & when will the next tech industry boom (ie jobs) come from?
Is the Obama administration trying to kill capitalism vs government spending?
When will kicking the Government debt can down the road STOP?

How Much Treasury Debt Does Japan Own?

noreply@blogger.com (Jeff Cohn) — Wed, 16 Mar 2011 21:38:00 +0000

Japan Owns 20% of the US Treasury Debt or $885 Billion

Why is no one inf the financial press talking about Japan being the 2nd largest holder of Treasury debt as a problem? Is this the stock Black Swan the market did not see coming? Will the US Government be able to issue enough treasury debt at current yields and continue the ponzi scheme it has been running for the last few years. The next few treasury auctions are going to be very interesting to see if the US government can fill the demand and at what price. If one of the largest investors Japan needs to pull back its contribution of over $885 billion? Isn't a red flag that one of the largest treasury bond holders funds Pimco has sold their entire portfolio? Will we see US treasury bond yields spike to 7-12% like Greece and Ireland? They are currently between .05 and 4.5% depending on the duration.

I happen to be one of the few people that believe the market has been artificially propped up by the Fed buying bonds in the open market. This cash gets invested back in the markets in order to prop up equity prices. I am all for capitalism and organic growth but the current run up in bond and equity prices have not been commensurate with the level of growth and unemployment.

Why am I worried about this as an early stage investor? Well, because I don't believe that our growth has been created organically by capital formation and venture capital. Our industry is still shrinking drastically. The day that the VC industry starts to expand in the US I will be the first person to claim we are in a real bull market for an extended period of time. However, for the time being I am bearish until the government can get out of way with regards to financial regulation and the government restructures their balance sheets to fit the private sector drop in wealth.

Comscore Competition - "We Don't Have Any"

noreply@blogger.com (Jeff Cohn) — Wed, 16 Feb 2011 23:26:00 +0000

ComScore is a company that uses panels to measure and track consumer behaviors, demographics, and advertising responsiveness for industries such as travel, pharmaceuticals, finance, and telecommunications. Consumer products companies use ComScore's website and online advertising network measurement tools and ComScore's Marketing Solutions products, which provide custom research and analysis from its panel. Scam or is this accurate information?

Today, on the earnings conference call Comscore management said "we have no competition". This answer was prompted after an analyst ask the following question: "how are your viewing the market competition?" Excuse me, but what about these web site analytics companies who more accurately measure? Alexa, Nielsen, Google Analytics, Omniture, Hitwise, Quantcast that provide more accurate information? What about this list of mobile analytics companies? Airsage, Amethon, Bango Flurry, GroundTruth, Localytics, Mobilytics, Motally, M-Wise, Openwave, Percent Mobile, Pinchmedia, TigTags, Xtract. How could you not consider these companies as competitors? If there are any other companies I am missing please let me know.

There are several mobile phone analytics and social media analytics companies and many of them are more accurate. Management also gave a very "wishy washing" answer to how they measure and manage social media and mobile analytics. How can you trust a public company that says we have no competition? How can you trust the data that so many large companies use but have limited reach to measure its traffic? Taking surveys and panels is not an ethical way to measure and track traffic. In fact its one of the largest digital media scams in the last decade. Someone needs to crack this egg and expose this.

Will Pandora's $100M IPO & Users Kill iTunes?

noreply@blogger.com (Jeff Cohn) — Sat, 12 Feb 2011 00:21:00 +0000

How Much Is Pandora Cannibalizing iTunes Sales?

I am happy to hear that Pandora announced a $100M IPO today after being rejected by hundreds of VCs who "pooh poohed" their "advertising based" business model many years ago. Fast forward a few years after Pandora's struggling years and almost shut down. Pandora currently has 80M users and is raising $100M in an IPO. This is not good news for music artists who get paid for music downloads and are quickly seeing this business dry up according to inside sources. What will an artist like Lady Gaga do? Up her licensing fees or partner with Pandora on a revenue share for advertising fees?

I come from the school that "if its free its me and if I have to pay no way". I am not a great customer of Apple iTunes because I could care less about owning the music. I just want to listen to it when I want. Since I have been a listener to Pandora guess how much music I have purchased? $0. Their really is no reason to own music for consumer to want to own music or videos any longer now that advertising based streaming music services like Pandora have arrived. I always thought the best move for Apple would be to buy Pandora to protect their iTunes music sales but it looks like that is not going to happen.

I predicted that Howard Stern would go to Pandora but that did not happen and he stayed with Sirius / XM and now you can listen to Howard on the iPhone. I also thought that Apple will buy Pandora but that didn't happen either yet. Here is a comparison of Rhapsody vs Pandora. Sirius is also a Pandora competitor but they need to get an app for the TV quickly. Broadband speeds have doubled and even tripled over the past few years. WiFi is very fast and reliable in most areas and 3G is maturing. So maybe Pandora video is coming also with LTE and 4G wireless distribution? Stay tuned and buy some shares of this disruptive company.

US Diplomacy Needs To Be More Transparent

noreply@blogger.com (Jeff Cohn) — Wed, 09 Feb 2011 22:44:00 +0000

The Egypt crises has certainly caused some confusion amongst financial community, media pundits, political conservatives and liberals. No one seems to know which side of the table to be on and who to support in the crisis. Wall Street and emerging markets responded to the protest by dropping a few percent immediately and volatility spiked but for what reason? What interests is the US trying to protect in Egypt and who do we trust? One important lesson from this power struggle crisis seems to be emerging and that is the "lack of transparency" in US foreign policy and support for Egypt. I don't expect a full disclosure Wikileaks style, but when I hear that Hosni Murbarak is sheltering billions and worth multiple billions of dollars it makes me sick. The US Government seems to be giving a billion dollars a year to whom? Egypt or Mubarak? How does it get spent if at all and who receives the check? How many other countries around the world do we support like this financially? I would love to see an in-dept study of this because hedge funds who invest around the World will be all over this issue to find the next "smoking gun". If anyone comes up with a InfoGraph to tell the story of US financial diplomacy please send it to me.

What Are the Largest Internet Publishing Networks?

noreply@blogger.com (Jeff Cohn) — Thu, 27 Jan 2011 01:19:00 +0000

List of the Largest Content Publishing Networks

In an effort to compile a list of the largest internet content publishing networks I would appreciate your help improving this list of 30+ internet publishing companies I have started below. I realize that this list could get exhaustive but in light of Demand Media's IPO it probably makes sense to crowdsource a list of the largest publishing networks and their monthly traffic numbers according to Quantcast top sites. There is likely going to be some consolidation in the space so companies like Demand Media can start building their own ad network to diversify from Google and Yahoo Ad Sense advertising. They will also need to scale their traffic in order for Wall Street to believe in the high growth story. Here is my list of the top generic 10 publishing networks and their respective monthly traffic numbers according to Quantcast. Its not always easy to distinguish the difference between an Ad Networks vs a Publishing Network but for this purposes we would like to build a list of companies who has a team of writers on staff.

Ranked by Monthly Unique Visitors - # of Web Sites
Interactive Corp IAC - 250M (Nasdaq: IACI) over 40 sites
Glam Media - 144M over 400+ sites
Answers Network - 102M (NYSE: ANSW)
Daily Motion Network - 93M
Federated Media Network -87M over 112 sites

AOL - 52M 1 site

About.com - 45M 1 site

Huffington Post - 37M 1 site

Demand Media - 34M (NYSE: DMD) over 9 sites

Gawker Media Network - 32M over 9 sites

Break.com - 32M over 9 sites
Hulu - 32M

Discovery Network - 32M over 5 sites

Associated Content - 28M (Nasdaq: Yahoo)

Manta - 23M
McClatchy Network - 23M over 67 sites
CNET & CPSSports - 22M (NYSE: CBS)

CNN - 20M 1 site

ChaCha - 20M 1 site
ESPN - 19M (NYSE: DIS)

WebMD - 18M

TMZ - 17M
NYTimes - 15M

Drudge Report - 13M
NFL - 12M
NBA - 10M
Mahalo - 10M

NBC & CNBC - 17M

MLB - 8M

Funny or Die - 8M
WSJ - 6M
Fox - ???

Are Groupon Coupons Getting Spammy?

noreply@blogger.com (Jeff Cohn) — Fri, 21 Jan 2011 23:05:00 +0000

The latest Groupon coupon fad reminds me of the mailing list spam days back in 1999. Back in the day companies like Yahoo couldn't get their hands on enough lists of emails and would use these lists to pump out advertising offers left and right. Eventually consumers got smart and had to use spam blockers and finally the Government required companies to offer opt-in email programs. Groupon is not much different, however, this time they give you a sense of urgency by saying that inventory is limited. Not only do most offers claim to limit the inventory but they often give you 50% off for a limited time. Yes, it seems like a good short term promotional tool but how long will it last and what will it do for customer loyalty?

Will Groupon become a victim of their own success always chasing the next deal and lose customer support? I think coupons should be scare commodity and not available to everyone. If everyone has a coupon it defeats the purpose of pricing anything and creates a sense of dishonesty amongst your loyal customer base. I think at the end of the day when this local coupon bubble pops the winners will simply be just good at local display advertising. I think Google gets this as well and will will likely start see display ads targeted on mobile phones that show offers like this.

Groupon turned down an offer from Google to buy them for $6 billion dollars apparently and it looks like they are headed for an IPO. I think this is a blessing in disguise for Google and they should be thankful that this did not work out. The competition in the coupon space is furious and there are literary thousands of Groupon clones that do the same thing. When Groupon first received funding and their valuation was north of $100M I said it was a great investor ponzi scheme and still think this. Its a big house of hards that is only held up by the huge pile of cash they have been able to raise. Its also not surprising to see them acquiring several companies in order to try and consolidate their competition. I also wouldn't be surprise to see some more controversy surrounding this company get publicized before it tries to go public. Groupon has lots of "skeletons in the closet" that will come out and at the end of the day the winners will ultimately be small niche local companies like Boomstreet who will be successful.

Did Google's Failed Acquisition of Groupon Prompt a CEO Change?

noreply@blogger.com (Jeff Cohn) — Thu, 20 Jan 2011 23:09:00 +0000

Did Eric Schmidt fail to consummate an important acquisition of Groupon that prompted the change? I personally am happy that Google did not buy Groupon because I think the company is very spammy. However, the category is growing quickly and Wallstreet doesn't wait around for excuses of why the advertising giant does not have a product in the category of group buying and coupons for local businesses.

Or is more about control and does Larry Page want more control of the company to make more acquisitions? Is Facebook's increased threat of taking market share from the search giant prompting some paranoia. The war is now on between company founders Mark Zuckerberg of Facebook and Larry Page of Google. It will be interesting to see how each will handle the growing mobile advertising industry and Google has a huge head start. Its kind of scary to see Apple and Google CEO have leadership issues as they are the two of the largest technology companies.

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Who is More Influential on the Economy Steve Jobs or Ben Benanke?

noreply@blogger.com (Jeff Cohn) — Mon, 17 Jan 2011 20:53:00 +0000

There is an argument to be made the Apple's $319 billion dollar market cap and its' publishing, advertising, software, retail and venture capital ecosystem of entrepreneurs and companies might be more influential on the economy than the Federal Reserve's interest rates controlled by Chariman Ben Bernanke. Here are 10 reasons why:

1) History has shown that the economy only grows when there is an ecosystem of technology that creates jobs & Apple has fueled the growth of tech which has created millions of jobs Worldwide.

2) Ben's 0% interest rates have had no effect on whether millions of consumers Worldwide have made emotional Apple purchasing decisions. Two thirds of the US economy is based on consumption and Apple is driving it.

3) Ben Bernanke is an academic that relies on historical data to make reactive decisions when economic history rarely repeats itself.

4) Steve Jobs relies on his vision to shape the future of the technology industry and millions of people are affected based on these decisions.

5) The stock market always needs a leading growth stock story like AAPL in order for investors to get excited and put money to work in the market. The Nasdaq 100 index QQQQ is 20% based on Apple and thus 99 other stocks are directly affected by how AAPL trades.

6) 0% interest rates over the last few years have done nothing but create a bond market and real estate bubble which does nothing for capitalism and growth.

7) Steve Jobs has created wealth for millions of entrepreneurs who have started companies to feed off the Apple ecosystem.

8) Ben Bernanke has put billions of dollars in the hands of bankers and bond fund managers to prop up the stock market and create a false sense.

9) Foreign countries who invest in US Treasury Bills, like China, are not happy that the US is intensionally keeping interest rates low thus devaluing the dollar. The Dollar cannot be devalued forever in order to finance the future and thus a long term bubble is forming if it were to rise suddenly.

10) Apple's stock (AAPL) has the largest market cap in the World at $319 Billion and if it were to lose value quickly it would take down a lot of hedge funds, pension funds who have jumped on the bandwagon of wealth creation and could be destruction if we are not careful.

Get well Steve! We need you and Google to keep all entrepreneurs and investors excited about the future. Technology NOT energy should be the basis of the World economy in order to leave a better place for our kids.

Register a Stock Symbol Without the SEC

noreply@blogger.com (Jeff Cohn) — Wed, 15 Dec 2010 16:42:00 +0000

A stock symbol or ticker symbol is a short abbreviation used to uniquely identify publicly traded shares of a particular stock on an exchange. A stock symbol may consist of letters, numbers or a combination of both. Today, tickers are registered with the SEC and are used by primarily public companies. Our Securities and Exchange SEC commission continues to fail in its ability to regulate the financial industry and doesn't have enough resources to do for the thousands of public and hundreds of thousands of private companies. One way to help provide transparency is to help make information more transparent for private companies so the bar isn't so high for investor liquidity and we see more IPO's. Here is one company that has a long term solution to that problem.

Manhattan Beach-based CapLinked.com the develop of software as a service tools for managing venture and angel fundraising run by Eric M. Jackson, reported Tuesday that it has started allowing companies to register unique "ticker symbols" on its site. The firm said that the symbols, which will be unique to private companies, can be used to identify companies on websites, in tweets, and also on such sites as SecondMarket and Stocktwits.

Previously, unique ticker symbols have been reserved for publicly traded securities and traders tag the tickers using a $AAPL symbol in Tweets. CapLinked is seeking to make tickers something that is also typical in the world of private investing. Private companies will benefit from a unique ticker for use in branding, social media, and investor relations.

Companies signing up for CapLinked’s free service also will be able to register a unique ticker symbol that could potentially be used on SecondMarket and Stocktwits since our system is based on their models. Caplinked's goal is to take SecondMarket’s concept, formalize it and create a ticker system that is universally accepted by the thousands of private companies and startups that register with Caplinked.

CapLinked gives private companies the tools they need to attract investment, share documents and act like a typical CRM Salesforece.com system would for sales. Caplinked companies will grow large enough to be traded on SecondMarket eventually and possibly take their CapLinked ticker symbols with them to the Nasdaq or NYSE. Ticker symbols can be reserved on a first-come basis, and that the existing symbols already in use on Second Market’s platform or by publicly traded companies will not be available.

SecondMarket focuses are larger VC back and private companies and unveiled the ticker concept for private company ticker symbols earlier this year when it created tickers for the nearly 500 companies traded on its site, including the likes of Facebook, Zynga, Twitter, and LinkedIn. SecondMarket’s private company ticker symbols have already been adopted by Stocktwits, a professional community of investors.

CapLinked is not working with SecondMarket or Stocktwits, but said it is using a system based on their models for ticker symbols. Jackson is one of the early employees of PayPal. CapLinked opened up its service in October.

Meebo Web Site Check-in Browser Plugin is Very Useful

noreply@blogger.com (Jeff Cohn) — Wed, 17 Nov 2010 22:32:00 +0000

Have you ever wanted to easily share the web sites you visit on a daily basis? Here is my web site profile that will allow you to see the Meebo web sites I like. While Foursquare and Google are fighting over location based check-ins and now Meebo has launched a new tool to allow you to checkin to web sites. Browsing by your friends is a new but obvious concept and I am surprised that Facebook has not developed a similar tool. Now its possible if you download and use the Meebo Checkins Plugin for your browsers. This concept is for real as Khosla Ventures led their $25M Series D venture round.

Watch the Web 2.0 Conference Live with Chat

noreply@blogger.com (Jeff Cohn) — Wed, 17 Nov 2010 18:30:00 +0000

Watch live streaming video from web20tv at livestream.com

Google Places + Hotpot vs Yelp

noreply@blogger.com (Jeff Cohn) — Tue, 16 Nov 2010 23:21:00 +0000

Google just launched Hotpot, a new service baked into Google Places that lets you rate restaurants, stores, bars, clubs and businesses to see which ones your friends like or dislike. It crowdsources rating or 1-5 stars or "best ever" if you really like it and think it special. It also allows you to view unrated, friends and all locations based on a search. One nice feature is the ability to click a box that says you are not interested as well. Its a very clean interface and the only thing it needs is an Android App which I assume is coming or will be integrated with Google Maps and Places. See the video below for more details on Google Places if you are restaurant or business owner and another video explaining Google Hotpot.

Its not surprising to see Google launching a business and restaurant recommendation service that would try and take market share from Yelp based on the traffic numbers below. This is great news for anti-spam lovers as Yelp's service has been gamed and is very spammy. Hotpot attempts to convert the recommendations of user connections for business recommendations advice for users. Recommendations and warnings will be used as signals to determine which establishments are presented to friends when they search and vice versa. Google Places is very well established geo location service that helps you find places nearby and likely understand where Free WiFi is available in the future. This ratings tool is also be another tool to help the company become more social and compete with Facebook.

How to Pitch Like Baba Booey

noreply@blogger.com (Jeff Cohn) — Tue, 16 Nov 2010 19:55:00 +0000

They Call Me Baba Booey

Gary Dell'Abate (aka Baba Booey) is one of the greatest radio personalities on the planet is Howard Stern's producer. Gary was visiting Torrance, California this weekend for his book signing "They Call Me Baba Booey" and also appeared on the Jimmy Kimmel show to redeem himselft to show everyone he can throw a baseball properly. If you listen to the Howard Stern show on Sirius / XM on a daily basis you will know about his famous pitch at the Mets game earlier this year and then now on the Jimmy Kimmel show. In the 2nd video below from the Jimmy Kimmel show he hits a woman in the head and an audience member catches the wide pitch. He has thrown 4 pitches and they all have been wild pitches. I love him but Gary how can you possible coach your son's baseball team? I hope you are not the pitching coach. On a side note Howard Stern's contract ends this year and it remains to bee seen if he will stay with Sirius or move to an new company like Pandora internet radio. Gary will likely follow him their having been together for more than 25 years. This should be a great book to read given all of the goofy bits over the last 2 decades.

Hilarious Video: Federal Reserve Explained

noreply@blogger.com (Jeff Cohn) — Mon, 15 Nov 2010 23:50:00 +0000

Kudos to Omid Malekan, who created this amazing video explaining quantitative easing to the average person to understand. This comes on the on the heals of a great video about why mobile phone consumers are so dumb the company has come . In this new video the two characters discuss the Federal Reserve's quantitative easing policy. The present it as a desperate and hopelessly misguided effort to save the world economy. One issue I have with the short film is that it also places the blame on Goldman Sachs which I don't agree with. They are simply helping to execute and should not be brought into this.

Related Articles:
How About Some QE for Venture Capital?
10 Ways President Obama Can Create Jobs
Ben Bernanke has Purchased Double D's

Video: SNL Skit on US Debt to China at G20

noreply@blogger.com (Jeff Cohn) — Mon, 15 Nov 2010 23:11:00 +0000

Scarlett Johansson was on Saturday Night Live this weekend and it had a hilarious but scary skit. Hollywood and the mainstream media are finally starting to get the implications of our $800B debt to China. President Obama was in Seoul South Korea this week at the G20 summit for business leaders. This is a hilarious video that show the aloofness of Obama with regards to the magnitude of the problem we are facing and our deficit I think it unfairly places the blame on Obama but it makes the point that the US needs to get its act together because the G20 Summit was exactly successful in terms of building business alliances. The dollar has lost 30% of its value in the last 6 years and stands to lose more. This is great for US exporters but it makes it even more expensive for US travelers and importing. This chart implies the lack of faith investors have keeping their reserves and making investments in dollars.

Ben Bernanke has Purchased Double D's

noreply@blogger.com (Jeff Cohn) — Mon, 15 Nov 2010 21:55:00 +0000

The Fed has spent most of the last two artificially inflating and deflating the stock market whenever they feel the economy needs a boost or is getting overheated. They know what they do has no direct effect on the economy but its a quick fix and doesn't provide any organic growth. Today, the only weapon the Fed has is the so-called wealth effect by driving the stock market up so people feel wealthier because interest rates are at 0%. The stock market went up 80% in 2009 so investors should be spending 2.4% extra of the entire value of the stock market, which is about two percent of GDP. Here is a great video explaining the boom and bust cycles and is a warning to all entrepreneurs to stay current with stock and currency markets because it now directly effects you even if you are a small business. Maria Bartiromo sits down with Jeremy Grantham who has made some incredibly good predictions over the last few years.

The new $600B of quantitative easing goes into the banking and corporate sector of the economy who is largely sitting on the largest cash balance in business history. They don't need the money at all and its not the sector of the economy who is going to take our unemployment rate down from 10-15%. Those who need the stimulus money the most, small business & private investors, can't get it. Seeing a company like General Motors go public again makes me want to puke. I can think of 100 other companies who deserve to be public companies before GM and that create far more future value, jobs and innovation in our economy. GM going public is simply a private equity, government money and investment banker ponzi scheme.

I was a apart of one the largest business boom cycles in the late 1990's and there were a lot o great things about that time the US Government, FDIC and Fed have forgotten. Investors were pouring money into Venture Capital funds that were providing funding to companies who were providing real long term jobs and creating new markets of innovation. Much of this money came from the Government in the form of FDIC subsidies and they made lots of money for taking this risk. Once the bubble burst and hedge funds drove the market 80% lower there was no optimism or money left in the VC industry to spark new growth. The VC industry has shrunk drastically in the last decade and almost 80% of the VC funds not based in Silicon Valley are virtually out of business (aka "the living dead funds").

Capitalism in general is kind of a ponzi scheme but it can be done organically if the IPO market is fair and open. Capitalism also works when Government regulatory agencies stay out of our way and don't favor big business monopolies. I think if $100B in stimulus for struggling VC funds this would create another boom of optimism that we need. The Fed and FDIC should also consider an Emergency Fund to fund to solve overweight population epidemic that is slowing the US economy down. Here are a few other ways President Obama could help create jobs.

Health & Wellness Venture Capital Funds

noreply@blogger.com (Jeff Cohn) — Fri, 05 Nov 2010 15:43:00 +0000

I heard an interesting investment thesis yesterday on CNBC that obesity is a major reason for our poor economy. The analyst said that fighting obesity with new health and wellness companies could add nearly $1 trillion dollars to our economy and create lots of jobs. While at the same time taxing fat and food companies that are responsible for putting this in our diets. Southern California would undoubtedly be the leading region of the US where outdoor activity and fitness are embedded into our everyday life. When you travel East or to the Midwest you begin to really notice how the Country has changed in the last 10 years. Kids are fat and parents are lazy.

Over the last 10 years Venture Capital has become increasingly more specialized and VC funds have become much smaller. The idea fund size in my opinion is around $25-$100M in order to accommodate smaller funding rounds. Health and wellness companies have been criticized by almost every VC fund over the last decade because they are thrown in into the category of a life style businesses. I think this could soon change if the US Government and Wall Street decide they want to take some companies public and a few private equity groups start looking to buy companies.

This is one reason I think the the health and wellness category could emerge as a new investment category that could garner lots of FDIC or government subsidy money. Are there any funds out there that have the thesis? If there are I want to know about them because exercise is a passion of mine. The types of companies a specialized fund would look for would be the following:

1) Running, triathlon and race organization groups (Marathons, Ironman, 10K Races)
2) Health Food Manufacturing, Distribution & Marketing Companies
3) Exercise Equipment Manufacturing, Distribution & Marketing
4) Adventure & Health Travel Marketing and Organizations
5) Natural supplements and vitamin companies. No drugs allowed
6) Internet publishing - coaching, counseling, advice, therapy
7) Physical therapy, employee health and chiropractic groups
8) Healthy diet and meal marketing & distribution
9) Software & mobile applications
10) Restaurants (maybe)

How About Some QE for Venture Capital?

noreply@blogger.com (Jeff Cohn) — Thu, 04 Nov 2010 19:09:00 +0000

"Quantitative Easing" from the Federal Reserve just sounds like another theoretical way to pump up the markets and the economy when they can't drop interest rates any further than 0%. $2 Trillion dollars of Qualitative Easing has already gone into the banking system and what has it done for you and me? What is another $600B going to do? Absolutely nothing.

It really makes me sick to hear that $600 billion dollars is going to be pumped into the banking system when these are the same "bone heads" along with the Hedge Funds that got us into the mess. What is the last time you heard a story about a Bank giving money to a company that really needs it? All bankers do is lend money to companies who don't need it because they are risk averse. All these morons do take your money and the Feds at 0% and "try" and lend it at 5-15%.

Venture Capital and small business is what drives the US economy and this sector of the economy is still being overlooked. Organic growth is the ONLY thing that will get the US out of this recession and create jobs. Why not give $100B dollars to some VC Fund Managers or Private Equity Groups at no cost and require them to invest it in the next 12 months? I guarantee you they will get a return on this investment. The Venture Capital industry has shrunk drastically in the last decade and I think this is the sole reason why we are still in a recession and will be until politicians recognize this. VC fund managers cannot raise money from LP (Limited Partners) because the returns have been horrible as a result of the IPO market being virtually closed. Sometimes I think the Federal reserve spends too much time listening to politicians and not enough time in Silicon Valley, Boston, New York, Chicago and Los Angeles where new ideas are created and organic growth is created.

Only 5% of Twitter Tweets Are Actually Read

noreply@blogger.com (Jeff Cohn) — Wed, 22 Sep 2010 19:47:00 +0000

I am a bit disappointed to have heard recently that only 5% of Twitter's Tweets are actually read. This doesn't surprise me one bit as the response rate from posts are very small unless someone has searched the key word or I have republished the Tweet on my Facebook page. I run three twitter accounts that broadcast about different topics: Jeff Cohn, DeadZones, PhotoEnforced. Through all of my accounts I have a nice organic following of about 3,000 people. However, the response rate is very low on each of the Tweets. I think this is largely because of the lack of reporting, spam and poor filter tools limit the ROI for the time spent. However, I keep publishing in the hopes that someday these issues are corrected and real time search become more of a mainstream event amongst social networks and news.

Facebook and Google are likely very knowledgeable of this fact and will soon launch features that will compete. Sharing is one of Google's biggest weaknesses and many think it can't compete with Facebook. However, I happen to believe that Android phones and potentially new service like Google Me social networking could give Google a boost on its lack of sharing features.

Catalina Classic Race is a Mental Challenge

noreply@blogger.com (Jeff Cohn) — Tue, 07 Sep 2010 03:24:00 +0000

This is a story of my first channel crossing on a paddleboard in the Catalina Classic race Sunday, August, 29 2010. 32 miles of open ocean from Catalina Island to the Manhattan Beach pier using your hands and no paddle. 24 miles to the first check point at the R10 buoy and 8 miles along the coast to the finsh line at the Manhattan Beach pier.

When people ask me, "do you ever worry about sharks?" my response is always a dismissive laugh and here is why . . . Racing in the open ocean is more of a mental than physical game as you compete against the elements that you can’t control. Fog, sun, clouds, wind, cold water temps, cold air, swell, current, boat waves, ships and maybe even sharks if you’re lucky. As my paddling friend Matt Walls describes what its like to race in the channel on race day, “When you wake up in the morning you don’t know if you are running the Catalina Marathon or the LA Marathon”.

I have done many grueling physical endurance races in my life on land but nothing that has challenged me mentally like a paddling marathon on the ocean. My endurance racing resume up until August 29, 2010 consisted of 15 running marathons (26.2 miles) 1 50K race (30 miles with 12,000 ft of climbing) and 2 Ironman triathlons (130 miles).

The euphoria experienced during each finishing line experience cannot be explained in words but here is my best attempt to try it once on my first voyage across the channel. As I paddled during the race I promised myself I would write about the emotional highs and lows during during the Catalina Classic race in order to savor the experience for my kids, family and friends. I was asked on the beach at the finish line by a friend, “was it fun?”. Without hesitation my answer was, “NO and I will never do it again”. However, as I write this story a few days later I can’t say all of it wan’t fun.

Some parts of race were fun but it was mostly a brutal mental test that I will remember for the rest of my life. I am very proud to have finished the race and now be apart of an elite crew of crazy waterman who make the journey each year and make the sport look so easy. I am truly humbled by the race pioneers and guys and gals who have finished before me.

I met my wife a few weeks before my first marathon in 1998 and she asked me a very simple question only a few days before it. Why do I do it? My answer to this day is still, “for the mind”. I do love the competition and the goal setting but most of all I love the euphoric feeling after finishing the race. Competition drives me to train and push harder but most of all I love the camaraderie amongst the competitors. Endurance races can push your body to the limits but at the same time it cleanses the mind and gives you renewed perspective, appreciation, love and happiness. I guess you can officially call me an endorphin addict and this is why I seek mental race therapy once a year to clear my mind.

I have always loved swimming laps in the pool for cross training exercise but I quickly get bored doing flip turns in the pool and I can’t swim for more than an hour. Open water ocean swimming is fantastic as well but its uncomfortable to be in the ocean by myself swimming alone. Growing up my Dad introduced me to the ocean very early and he would frequently take my brother and I sailing out of Marina Del Rey. We never made the sailing voyage to Catalina but often discussed how dangerous it was if you were caught in bad weather in the channel.

When I first saw a paddleboard on the ocean and I learned that people were crossing the channel to the Catalina it sounded like a challenge I wanted to do someday. I quickly fell in love with the concept of having my own board to discover the ocean and it was the perfect combination of swimming, boating, surfing and endurance into one sport . . . paddleboarding.

I was introduced to my first paddleboarding experience about 6 years ago after borrowing an old downwind paddleboard and thinking “Ironman me” could do a 3 hour 12 mile race, “cold turkey”. I had never been on a paddleboard in my life and I decided to do my first race of 12 miles which was really stupid. The race was 6 miles upwind to the R10 buoy from the Hermosa Beach pier and 6 miles downwind back. I made it about 4 miles offshore into a cold headwind and with cold water crashing on my body and quickly decided I was too cold to go on. I hailed the lead Body Glove boat as it was passing by to pick me up as it was escorting the race leader back from the R10 buoy. Ok, I failed at my first race and this sport was harder than I thought and now had a new challenge to overcome . . . the ocean elements.

I waited about two years before I finally got the bug to try it again and I purchased my first 17 foot paddleboard from a guy in Malibu. I was hooked and spent a few years learning the technique with the South Bay Donkey's (paddleboard group). Tips like pinkie first to preserve your shoulders (Kyle Daniels), how to catch the tiniest of bumps in water (Matt Walls), how to choose a board that is right for you (Scott Rusher) and finally how to master balance on my knees.

For three consequent summers I was always asked by the Donkey’s, “are you going to do the Classic this year”? My response was always, “I will do it when my escort boat crew falls easily into place”. All the stars became aligned in the winter of 2010 as I learned that a good friend Ken Deemer was going to store the Katie B, 45 foot boat in Huntington Beach for the Summer, up from Mexico. I had to take advantage of the opportunity and I no longer had any excuses not to try the race with Ken Deemer as my boat crew. My escort boat was booked and now I had to find the time and discipline to put the training miles in before the race.

I am an avid runner and usually log a minimum of 35 miles per week over about 4 days. I try and do some running crossing training throughout the week on the off days to keep my running legs, lower back and knees functioning properly as I near the age of 37. Getting older isn’t easier on the body for recovering and paddle cross training is a key element to recovery. Running is fairly easy to do in Southern California over 365 days per year and there are very few times that the weather was a factor limiting my training.

As a runner you have much more control over the elements by how I dress and prepare for a marathon. Run in Phoenix and you know what you will get dry hot temperatures. Run in the mountains and the temperatures will have predictable extremes and the oxygen levels will be low. Race in Kona and you know it will be windy, humid and hot. Physical and mental training preparation is predictable and fairly easy to simulate to give you confidence prior to a race. However, ocean racing is unpredictable and you must be prepared for hundreds of different types of conditions. No day is ever the same on the ocean which makes it exciting but also a challenge.

For almost a century waterman have been crossing and racing in the Catalina channel to the mainland. Some with success and a many have failed. Sharks? Nope, the elements! Fog, sun, clouds, wind, water temp, air temp, swell, current, boat waves and ships. Its a lot to worry about and you don’t have control over anything. The ocean is a highly unpredictable beast and virtually impossible to accurately forecast. It can be brutal on the mind if you are not prepared for the conditions dealt.

Ask any Catalina Classic veteran to describe their channel crossing experience and they always seem to have a sparkle in their eye. The conversation always ends with, “you gotta do it Jeff”. After three years of trying master the techniques and learning from all the locals (Donkey’s) in the water I finally could register for the longest race in the US which finished near my home. The Catalina Classic is 32 miles from Two Harbors on Catalina island to Manhattan Beach pier. The race starts at 6 am and the cut off time is 3 pm at Manhattan Beach pier. Why does the race start in the dark and so early? Elements.

As a 35 mile per week runner I don’t carry much muscle mass or body fat to keep my core warm and that is an immediate disadvantage in the sport of paddleboarding. Most of the guys and gals in the sport hate running because they usually carry a lot more upper body mass which helps them regulate their core body temperatures. Wetsuits can keep your body warm and prevent you from getting hypothermia but they also slow you down and restrict you movement on the board. They also can work against you when the sun comes out and cause you to overheat. Dehydration then becomes a problem by sweating too much and you can’t drink enough water to stay hydrated.

The summer of 2010 has been one of the coldest summers on record and anyone who has lived in the South Bay can’t remember a summer like it. The ocean water temperature is typically a reliable 67+ degrees throughout the summers and occasionally hits 70 with warmer air temperatures. However, this summer the ocean has averaged about 5 degrees colder than normal and barely hitting 62 degrees. The air temperature in Southern California near the beach averages between 55-65 degrees for 12 months of the year. If the air gets much above or below 57 to 67 it is very rare because of the power of the ocean to regulate the air temperature. This has been “lost summer” without much sunshine as the marine layer has been present almost every day. It played a factor in the training throughout the summer and many racers opted not to do the race because they feared the colder temperatures.

My race weekend started out with a a boat ride over to Emerald Bay on the Katie B which is a 45 foot fishing boat with 5 bunks and 2 bathrooms. We straped my paddleboard to the starboard railng of the boat to save room. On the way over we happened to see several grey whales and a couple of very large blue whales which is extremely rare for Southern Califonia. Was it the colder water possibly keeping them here? As we motored over the water temperatures were reading 59 degrees in the middle of the channel and my fear started to set in. Did I pick the wrong year to do the race?

My nerves really started to creep up after I arrived on the island and begin to get a feeling for the cold water and air. My first night sleep was awful even after a few beers and laughs with my crew to calm the nerves. I am not sure if I even slept more the two hours the entire night tossing and turning in my bunk. The next day Ken and I went for a two hour hike to check out the island which was helpful to take my mind off of the race for a while. It worked for a while but probably wasn’t a good idea considering I had to hike four miles in the hills with flip flops. I forgot my running shoes but needed to get off the boat for a while and stretch the legs.

That evening the pre-race dinner didn’t do a whole lot to calm my nerves sensing the anxiety in the other paddlers. After one night of no sleep I was still thinking, “this is crazy, this is crazy, this is crazy”. The logical right side of my brain kept questioning if this race is soo fun than why are only 85 guys doing it this year and 50% of the field were rookies? It became aparent that not many people returned to do the Catalina Classic twice and I was about to discover why. Millions of people have done running marathons each year and a few hundred thousand people have done Ironman triathlons. I would bet only a couple of thousand people have ever done the Catalina Classic race. Was I crazy and is there something I don’t know?

I tried to eat the Mexican dinner provided to all of the racers and the boat crew but my stomach was already too nervous to digest anything. After the race directors gave their safety and rules speeches, each racer introuced themselves around the courtyard one by one. “Jeff Cohn from Hermosa Beach and this is my first Classic”. Only a handful of women were in the race and the total race numbers were down from previous years to only 85. Perhaps veterans were taking the year off due to the cold weather. I almost threw up at the end of the safety speech as one of the race directors said with fear in his voice, “there are only two things that scare me in this race . . . fog and hypothermia. Be safe and escort boats keep an eye on your paddler because hypothermia can set in quickly and its hard to reverse.” Wow, something new to worry about before another horrible night of zero sleep.

The next morning I crawled out of my bunk on the boat after not sleeping for a second night in a row. I tried everything to get my mind off of the race but I just couldn’t stop thinking about the what if I am too cold? Should I wear a wetsuit or will I be too warm in it? I had all the confidence in the world that the race was not going to be as physically demanding as a running marathon or Ironman. During training I had successfully completed a 24 mile paddle three weeks earlier and we averaged 4.8 MPH and my confidence soared. Recovering from this paddle only took a day or two because there wasn’t much impact unlike running.

The fatigue factor during the race shouldn’t be anywhere close to the pounding experienced during a running race. However, I still had many questions about the unknown elements of the race I could not control. Could my body and mind withstand almost 8 hours laying down on the board with a wetsuit top and booties and what would happen if I got cold? Could I digest the food and drink properly?

I woke up at 5am and at 5:45 am my boat stopped in the harbor a few hundred yards offshore. I dropped my board into the water in the middle in the darkness and and heard a loud “crunch” as it hit the water. That crunch sound was the bottom of my board landing right on top of the boat ladder which was still out on the landing. It sounded like my board hit the ladder and broke the fin but I checked it and it seemed ok and still functional. What I didn’t know was my boad hit the ladder causing a 3 inch gash under my board that could take on water and slow me down. I am so glad I didn’t see the gash in my board before or during the race as I probably would have had another excuse to drop out.

I had two water bottles on the board, some food (Power Gel blocks) in my wetsuit top and my phone in a waterproof case (just in case) as my escort boat dropped me off in the harbor at 5:45 in the dark. As I paddled through the harbor without my prescription glasses to the beach starting line I could see escort boat lights coming at me out of the harbor and I had to quickly dodge them. I glided up to calm beach in the dark and immediately went to sign in and stand by the bonfire to stay warm.

Looking around the bonfire was quite intimidating seeing all of the ghostly faces with sunscreen staring into the fire with a look of fear. While I was warming myself against the “fire of fear” the 5 minute warning from the race director megaphone was given by Kyle Daniels who has won the race multiple times. I could even sense the nervousness in his voice as he was giving the countdown instructions. Kyle wasn’t doing the race this year but was responsible for 85 lives trying to make the crossing and it was going to be a cold day. That would scare the hell out of me as well.

I walked to my board on the beach and stood in knee deep water before the race start not knowing I had a 3 inch gash in the bottom of the hull. I found a spot next to 27 time finisher Joe Bark who had a board with tiger stripes. Joe was the same person who shaped my board about 12 years ago. The horn went off at 6am sharp and we were off flying in-between the boats in the harbor. The pace was ridiculously fast as the race leaders were all jockeying for the lead position and the other paddlers behind followed in their wake. We were quickly outside the harbor and into the open ocean that was not looking looking smooth.

If you are in the lead or near the front of the pack the water is smoother and you can carve out your own path in the non-drafting race. However, if you are in the middle or the back of the pack you have to deal with the chop from other paddlers in front of you and the 100 escort boat waves. Every race I have done it has been annoying to have to deal with the chop from the faster paddlers and I can’t seem get to get to my knees comfortably without feeling like I am going to fall off in the waves. Usually the chop clears up after a few miles as spacing between the racers increases.

However, this race was different because it had 100 escort boats creating chop and moving all over the channel. Not to mention the headwind and the swells that were converging. Shorter races near shore usually don’t have this problem in the morning with only one lead boat and a couple of emergency boats if needed. Another element I forgot to consider that might create some issues with trying to stay warm. It was bumpy and I couldn’t get a good rhythm in the cold sloppy water. I surrendered the fact that I am going to stay paddling on my stomach for a few hours and quickly gave up the idea of trying to stay with the guys around me. I was getting tired of being in the same position on my stomach and typically spent 50% of my time or more on my knees in training.

The boat waves were difficult to deal with because they are spaced too closely together and it became impossible to gain any momentum going over the top of them. There were big boats and lots of small boats creating the chop and they were mostly all ahead of me. Boat chop makes it extremely difficult to get to my knees and use my running legs and quads to go faster. However, swell waves are great regardless of direction because they are spaced farther apart and I can ride up and down them for momentum. The only way to deal with boat waves is to go through them if you have knifey board nose. Some of the faster guys just seem to go over them. After about two hours of choppy boat waves I began to realize there was also a headwind building into my face.

Wind can be your best friend and also your worst enemy on the ocean. A tail wind is amazing if it’s blowing in the direction you are going and can be a lot of fun. However, a side or headwind can be horrendous and cause you to lose significant speed and body heat. In my case warmth was my biggest concern as the wind splashed 59 degree water right on my legs, face and arms. It also leaked right into my wetsuit top and into my biking shorts with ease. I was getting cold quickly and with every paddle stroke another splash of cold water hit my entire body. After about two hours I started to shiver on the board and began thinking about what the race directors said their biggest worry was . . . “hypothermia”.

Hypothermia starts with the body shaking and ends in death if you don’t get your temperature regulated quickly. The rational right side of my brain kept saying, “Jeff stop & put on the wetsuit so you can see your wife and kids again”. The irrational ego left side of my brain kept saying, “Jeff you are not paddling hard enough to stay warm, a wetsuit might be too warm and might take you 15 minutes to put on and your goal is seven hours”. I soon realized I was torturing myself and wanted to try and have good memories of the race. Maybe this is what water-boarding prisoners in Guantanamo Bay was like?

During the second hour my memory became a little foggy but my math skills were still pretty sharp. My boat crew looked concernd as it took me about two hours to go eight miles and I was only through one quarter of the race. I was going to be in the water for eight hours. My boat crew explained to me that we had only gone eight miles in two hours and averaging only 4 MPH. This was very discouraging considering my target was 4.8 MPH after numerous training paddles where I had averaged well above 4.5 MPH for many miles. A 7 hour goal of 4.5 MPH to average seemed very reasonable during training if conditions permitted. I became extremely upset and kept wondering what I was doing wrong.

The winner of the race typically averages 5.8 MPH which gets him to the finish line in 5 hours and 30 minutes. The difference of 1 MPH in the race is well over an hour in this long distance race. Every .1 MPH speed is a big deal in a sport where board shape, training mileage & technique play a big factor into speed. It finally hit me about two hours into the race and that I was expending more energy trying to stay warm versus propelling myself forward through the water and it was time to put the wetsuit on. No matter how hard I paddled on my knees I could not forget about being cold and wanted to drop out of the race. However, I knew I would regret it and have to come back to attempt the race again.

Unfortunately, I trusted my training experience more than I trusted the common sense of my boat crew and I didn’t put on the full wetsuit before the race start. However, I did compromise with them slightly and put on my booties to try and keep my extremities warm which helped for a while. I kept telling myself that I have paddled in the middle of the winter without a wetsuit in 55 degree water with the dun out and wind for hours and wasn’t cold until I stopped. Just keep going and the energy you create by paddling will keep you warm. Also, stop looking at your boat captain who is sitting up on the top deck with a ski hat and winter jacket on looking very warm and cozy.

Being cold is an awful feeling and I may be scared forever based on this experience in the cold ocean. I knew I was starting to get incoherent when my boat crew asked where my wetsuit was and I said to them “you have it”. They found my suit finally and it took me almost 15 minutes to put it on while shivering. After ten minutes of paddeling in the wetsuit I felt my body temperature come back to normal as I continued on the journey to the mainland.

Wearing a wetsuit can be great to keep you warm but it reduces your mobility, reach and requires more energy with each stroke. Unfortunately, I had not trained with a wetsuit on and I was using my Orca triathlon swimming wetsuit that fit perfectly 5 years ago when my upper body was not bulked up from paddling. The wetsuit is also designed to work best with a small amount of cold water flowing through it during a swim. The fit was way too tight and restricted my reach with each stroke on my stomach. Getting to my knees was even harder with the restrictions the wetsuit created on my lower body.

I prefer paddling a few hundred strokes on my knees, followed by a few hundred strokes on my stomach. Paddling on your knees relieves my shoulders and arms temporarily while using the strongest muscles in my body my running legs. It does require more energy and typically you can go a lot faster having two hands enter the water at once. It is similar to the butterfly stroke in the pool.

While paddling on my stomach (which I hate) there were times I would lay my head on the board and only look up every few minutes just to see where I was going. My boat kept telling me that when my head was on the board I would speed up a few tenths of a MPH and I was going faster for some reason. I tried keeping my eyes closed for a while and while taking mini naps while paddling to shut my mind down and relax. I tried naping during a race while paddling which I thought was cool at the time. The lack of sleep from the previous two nights was creeping up on me quickly and I was mentally exhausted from all the pre-race anxiety.

Sometime during the third hour of the race my body went from freezing to now sweating in my wetsuit. I started getting overheated and my mind quickly shifted to thinking about hypothermia to dehydration in the fourth hour of the race. I tried removing the wetsuit from my upper body as I started chafing around my chest and started slowing down a lot with the restrictions. It was easy to remove from my arms and chest while stopped and I tied the sleeves around my waist. As the suit was tied around my waist it bunched up around my stomach and made me have a hard time digesting food and drinking. I also didn’t realize that the wetsuit had rubbed off all of the thick sunscreen I put on at 5:30am.

I was near the breaking point again and sobbing on my board. I was exhausted by the changing continditions and not being able to decide what to wear to make me comforbable paddeling from the remaining four hours. Should I stop and put sunscreen on my back again that was frying off the sun and reflection from the ocean? Tears were streaming down my face and I wanted to drop out in the fourth hour but this time as I started throwing up my drink and coudn’t eat anything that tasted good to give me energy. I felt like I was going insane.

All I wanted to do was hug my wife and kids. I couldn’t get my family out of my mind which made even more tears flow down from my face. Crying on the ocean is not exactly recommended as solution for someone trying to stay hydrated and already surrounded by salt water. I have a history of getting migrane headaches from stress and dehydration and I could feel one coming on.

I decided to call my wife with the phone on the front of my board to get some motivation to finish. I had used my mobile phone several times while on speaker in the waterproof case before and I could do it without using my hands. My wife loves it when I call on the ocean and it makes her feel better to know when I will be home and where I am. I pushed the phone to dial and hit the speaker phone. Then I thought twice and hung up because if she hears me suffering the sadness in my voice she is going to worry even more and question my boat crew. Maybe even send the Coast Guard helicopter. Not a good idea and I quickly hung up. My lonely journey through the open ocean continued on.

Paddling alone in the ocean for more than a couple hours when you are not feeling well is like being in hell. Typically when I go out to paddle on my own I stay close to shore and find people to chat with in the water. I do this partly for safety but it’s also more comfortable with more people around you. Everyone in the small paddle community of the South Bay knows each other and its just not that fun to paddle by yourself for more than an hour. Music helps cure the boredome and the fatigue but it will only get you through a couple of hours alone. After the first four hours alone my motivation quickly turned to completing the damn race. I thought to myself I never want to do this again!

Ironically, my arms and legs were not tired at all and I physically knew I could press on slowly if I could keep food and water in me. I wasn’t pushing as hard as I had in training for fear of bonking or dehydration. I would take a drink of Cytomax, Coke and water and then try to eat Fig Neutons and Cliff Bars but everything tasted like crap and my stomach immediately rejected it. Maybe it had to do with the fact that I was laying on my stomach for most of the day and I couldn’t digest anything very well. I knew I could only go so far without food from my Ironman experiences but I didn’t know what that breaking point was on a paddleboard. Coke tasted the best and was essential caffeine and sugar I needed to stay sharp. I didn’t mind the puking either for some reason, nor did it slow me down. It just flew right out of my mouth and into the water for the fish.

Thankfully my boat was watching me closely and kept asking me if I was peeing to make sure I was hydrated. Eating anything solid was impossible and I just gave up after a while and stuck to drinking my Cytomax energy drink which tasted good and my PowerGel blocks for calories which was probably making me throw up. I had to keep eating if I wanted to maintain the energy output needed to go faster as I was getting warm.

During the fourth hour of the race, the temperatures continued to rise and the wind changed direction. My Orca triathlon wetsuit was too thick and I was really starting to dehydrate as the temperatures continued to get warmer. The wind had permanently changed direction and finally started helping me go faster with less effort. I had to take the suit off and wrap it around my waist and throw a rash guard on to keep from chaffing on my chest. However, this was not comfortable because when I tied the sleeves around my back, the bunched up wetsuit pressed on my stomach as I layed on it. I tried wearing half of the wetsuit but the water was 59 degrees and as I got closer to Palos Verdes my body temperature quickly dropped again.

Now I had to stop for the third time and put the wetsuit back on my arms and chest again to keep from freezing. After two nights of zero sleep and mental exhaustion I was in race survival mode. All of my race priorities and goals were thrown out of the window. The ocean was winning the battle and had taken my mind to a deep dark lonely place of frustration as I wondered why no one else seem to be having the same problems as they paddled through the cold channel.

My questions were finally answered when fellow South Bay paddling friend, Kevin Kody came up on my tail at about mile 20 which was about 5 hours into the race. I could tell he was all business and quickly picked up the pace to try and drop me since this was his 12th time doing the race. He had a full wetsuit on, GPS, food and drink on board while is boat crew was relaxing peacefully on their sailboat. Kevin seemed to have the race formula down and I told myself I had to stick with him as long as I could to get to the finish line.

I have never been so happy to see someone on ocean as I was on this day. I felt like I had been alone paddling on the ocean for a month and just wanted to see someone to talk with and say hello to remove me from my insanity. I was in a deep dark place for much of the race but now I had someone to talk to and keep my mind focused on the finish line. Kevin was helpful great and listened to my whole experience during the last 5 hours. Somehow talking to him for a few minutes made me forget what I had just come through.

We finally made it to the R10 buoy around noon which was six hours into the race. The clouds, chop and wind were all completely gone and it was getting very hot. It was a brand new day and a whole new race. The euphoric feeling I had getting to the R10 was great and my boat cheered loudly. It was my first crossing of the channel and that was an accomplishment in itself. I was startging to get dizzy on the board and vertigo was likely setting in. I told Kevin that if I had to drop off between the R10 and the pier at least I made it across the channel. I was mentally much stronger after crossing the R10 checkpoint. I had accomplished one goal and that was my first crossing of the channel and I had someone to share it with.

Paddling alone in the ocean is not very fun and this is one epiphany I had during the race. Much like running in a group, its easier to pass the time and share your experiences if you have someone or a group to do it with. The repetition and the monotony of doing the same thing for hours is taxing on the mind. At times during the race I would sign to myself during a 311 song just to pump me up. I had an Ipod Shuffle playing in my ears for most of the race which helped some. I didn’t have an appreciation during training how hard it was to paddle by yourself for a long period of time. Its easy to get relaxed when you are alone and start thinking too much how cold you are or how far you have left to go. Going slower by yourself is inevitable.

Most of the experienced paddlers recommend that rookies do the Rock to Rock race in June. This race is a warm up to the Catalina Classic in order to learn about the potential conditions and elements. The R2R race is 22 miles from Two Harbors to Abalone Cove off of PV and typically only takes a little of four hours. Most people use this race as their first channel crossing to learn about temperatures and nutrition but not stubborn me. I always said if I have a bad first channel crossing in the R2R race I will never do it again. So I might as well do the big Catalina race first and not test the waters to see if I can handle it.

After leaving the R10 buoy with Kevin I felt like the sun beating on my wetsuit and the wind seemed liked it was going to be at our backs for the rest of the race. I was getting too warm in the wetsuit and was more worried about dehydrating as I was sweating profusely and losing a lot of water. Kevin Kody who was an Catalina Classic veteran for the 12th time explained to me that he had only had two water bottles in the last 5 hours. What was I doing wrong if I had 5 water bottles? Was I drinking too much? I was now warm enough that I had to take the wetsuit and booties off and finish the race comfortably on the board. Unrestricted in the heavy think wetsuit.

For about a sixth time during the race I had to stop and make a change what I was wearing. This time I took the wetsuit and booties completely off. By now I think I wasted about thirty minutes changing and figuring out the most comfortable thing to wear and just complete the race. I was no longer focused on racing and just enjoying the company and complete the thirty two mile adventure. Taking the wetsuit off rejuvenated my spirits and it seemed like a whole new race. I was able to spend more comfortable time on my knees which is essential to going fast and staying warm. However, I would soon realize the sun was beating down on my bare skin that had no sunscreen on anymore. I was frying in the hot sun refelcting off of the water.

One thing veterans tell you during training is to never look the Redondo Beach power plant mural or the marina jetty because it will seem like it never gets any closer as you paddle north to Manhattan Beach. However, the clouds were gone and visibility was great to see the smoke stacks of El Segundo and the red roof of the Manhattan Beach Pier. The eight miles from the R10 buoy to the Manhattan Beach pier was extremely fast and it went by like a flash. All I could think about was my wife and kids on the beach anxiously waiting to see me. I had been waiting three years to do the race and I was finally about to accomplish a goal that I had feared for so long.

I was inside the last half mile and I could see the large crowd on the beach and on the pier. Kevin counted down the number of strokes left and we were both up on our knees hammering away and gliding into the runners. My adrenaline was pumping hard so I didn’t have to take many strokes before I was launched in a runner. I wanted to finish the race with Kevin because he had help me come through such a bad patch. Kevin was getting close to one of his personal best times and I wanted to help him acheive it.

After 7 hours and 47 minutes I was finally at back to the beach and I could see my family and finally get warm. The simple things in life . . . warmth and family were within my grasp and it was heavenly. I threw my board to someone on the beach and raised my arms in victory after absorbing a lot of punches from the ocean. My wife was the first person I saw on the beach and she ran up to me and grabbed me for a long long hug. Having your best friend hug you at the finish line after overcoming some very tough mental challenge was the best ever. My four year old Nate was on the beach as well and offered a high five. His only question was, “why did you take so long?”. My answer was, “someday I will explain it all to you.” All I wanted to do was stand on land and be wrapped up in warm towels.

My body was shivering on the warm beach in the 75 degree air. My body stopped stopped generating its’ own heat by paddling. As I looked around the beach with blood shot eyes I began to realize this race is kind of crazy. Everyone looks like a a zombie and their brain probably feels much like mine . . . “MUSH”. After being on a boat for 3 days the brain still thinks you are on a boat and keeps rocking back and forth to compensate for your balance. Vertigo is what they call it.

As I write about my emotions and experience during the fifth day of my recovery, my brain still feels mush and my equilibrium is off. I still have the sensation of of being on a boat when I wake up in the morning and many times throughout the day. A friend of mine said to me on the beach it will take a while to go away but 5 days is kind of crazy.

Despite having vertigo my mind feels fresh and free of any negative “cob web” thoughts I might have had prior to the race. The race was one giant brain cleansing and I am still on a high from the finish. I am definitely enjoying the post-race honeymoon and hope it last for a long time.

The ocean can take your mind and body to the deepest and darkest of places when it decides to growl. The cold ocean water can strip your body of heat and hope to make you beg for mercy. But when the sun comes out and a friend comes along to keep you company somehow family and friends come vividly into perspective. Why did I do it ? For the mind!

A special thanks to my boat crew Ken and Candy Deemer & Jill for making the experience possible.

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noreply@blogger.com (Jeff Cohn) — Thu, 19 Aug 2010 21:17:00 +0000