Skip to content

Free airport accommodations, courtesy CrowdStrike. Acquired’s latest podcast — on Microsoft. Why my granddaughters are the smartest.

How fast things change

In 2019, a stunning office building complex in downtown San Francisco sold for $722 million.

Today, five years later, the building would sell for $200 million.

That’s a 72% drop in value.

The owner, a public company, will lose its entire investment in the building. It will hand the keys over to a bank which has a $430 million mortgage loan on the building.

If the bank sold the building today, it would lose over half its “investment,” i.e. its original loan it made on the building..

Instead the bank may decide to hold the building, which presently has a 50% occupancy, meet ongoing expenses and pray that in some future year, people will once again want to work in the building.

My friend, the expert, says “If the purchase price is $200m. There is probably $50-100m of capital needed for mechanicals and lease up of vacancy to keep the complex alive.”

San Francisco has presently the highest vacancy rate of any major U.S. city – around 35%.

San Francisco has been mismanaged bigtime in recent years – homelessness, crime, tech industry layoffs, work at home and ultra-lousy local city management.

All this misery got exacerbated the covid pandemic of 2022.

There’s a lesson here somewhere  for investors – it’s probably called diversification.

That is the subject for another blog.

Acquired’s latest podcast

By now all my readers know that Acquired puts out the absolute best business podcasts. Here’s their explanation of today’s new podcast:

In 1999, Microsoft became the most valuable company in the world. And in 2019, Microsoft became the most valuable company in the world, again. But. what happened in the twenty years in between? The answer, as we discovered in our research, is probably not what you think.

In this episode we explore and analyze the browser wars and the DOJ case, Windows XP through 8, Surface, Xbox, search, Yahoo!, Bing, the iPhone, Nokia, mobile, social, Facebook. and oh yeah, a little thing called Azure and the enterprise – which ended up becoming so big that no failures mattered. Tune in for Microsoft, Volume II.

Be aware, this podcast is nearly five hours long. I recommend you download the entire 280 meg file. That way you don’t have to rely on awful cellphone service, i.e. Verizon.

CrowdStrike is a disgrace. Part 2

On Friday I reported that I had dumped my entire holding of CrowdStrike (CRWD) that morning. Good riddance.

I also reported that no one needs to use CrowdSrike’s software and shouldn’t. Windows Defender and commonsense work perfectly fine — and with much less aggravation

Today Monday, Crowdstrike is down another 13%. (So much for buying bad companies on the dip.)

Now we take the story up in Atlanta airport:

This is where the sister of a dear friend of mine spent three days last week, courtesy CrowdStrike’s fu*kup. Her bed was carboard boxes she scrounged. She never got more than a few hours of decent sleep, because every four hours or so she’d have to rush to a gate to see if they had a seat for her. Which they usually didn’t.

One fellow we know gave up on the planes (and CrowdStrike) and drove a rented car from Toronto to New York.

The bottom line. You (and your conpany) don’t need CrowdStrike, the software, or CrowdStrike the stock.

Here’s an enhanced version of what I wrote on Friday morning:

I dumped my small holding of CrowdStrike (CRWD) this morning. Good riddance.

First of all, it’s a total disgrace that Crowdstrike, a cyber security company, could wreak so much damage worldwide by simply being sloppy. One line of bad code. Yuch!

Second, I searched CrowdStrike’s web site for one miserable word of apology, or explanation. Nothing. Yuch.

Third, my friend, Ed, watched Cramer interview CrowdStrike’s CEO this morning. Ed said the interview was “unimpressive”. Ed also said “The guy doesn’t seem very bright, and did NOT inspire confidence.”

Fourth, I blame myself my idiocy. What was wrong with my tiny brain to own a stock with a P/E around 550. Yes, you read right — 550.

What exactly does Crowdstrike do? It’s biggest accomplishment is scaring the corporate and airline world into believing that that world absolutely desperately needs Crowdstrike. Without Crowdstrike “protection” their computer systems will be hacked, be vulnerable to ransomware and all their servers and computers will crash.

Guess what just happened? And it wasn’t hackers? It was the world’s great protector — CrowdStrike. They shot themselves and their customers in the foot.

What’s got me going  is that no other cyber security does what Crowdstrike does. Others work in the background on servers and in the cloud. Not Crowdstrike. Its software takes over your company — your laptop, your desktop. When it goes kapluey with a lousy “upgrade” — which just happened, you have to get to everyone’s machine and fix the damage that Crowdstrike has done — which may vary from one machine to another. Yes, one machine after another.

A huge job.

Now you know why it’s taking so incredibly long to fix airline (and others) worldwide and get passengers on planes.

Over 4,000 flights were canceled on Friday. There were over 38,000 delays.

That’s a massive f..kup. Thank you CrowdStrike.

P.S. If you really want to throw up, read the Apology Litter that CrowdStike’s CEO sent out. Click here.

I just spent $2700 on eight tires

But, the good news is that I found a cost-saver.

A three-wheeler.

The boring story. We live on a dirt road. The town uses our tax dollars to “fix” the road. That means filing the potholes with jagged stones, which are cheaper than nice rounded stones. Three punctures, five shredded tires and fun sojourns at Fredericks Performance in Ghent, we now have two cars with fancy Michelin tires ($2,700) and Peace of Mind. At least until next Spring, when our road gets “fixed” again.

I’ve offered the town to pay for the blacktopping.

My friend has a new granddaughter

He says she’s “the most intelligent and beautiful child born this century.

He knows not what he speaks. My three granddaughters surpass, in fact eclipse his newborn. I asked Perplexity AI for poetic proof:

While some Wall Street analysts are worried that the Magnificent Seven will never show a profit on their zillions of AI investments and the world is rotating into smaller, boring stocks, I’m happy to stick with Nvidia as my largest position, and the others — in order — META, AMZN, GOOGL, MSFT, AAPL and LLY.

No one is making money on Harry and his poetry. But my friends, who work for real companies and work in teams, love Microsoft CoPilot Teams. They laud its time saving features.

I bet readers are using it also to save time and be creative. If you have a moment, send me an email on how you’re using AI. If you haven’t the time, ask AI to do it.

Latest insights

On the way to tennis this morning, I heard the head of Verizon tell the world what a great company he was running. Which was a coincidence because Verizon had just cut me off from a call with Susan, my wife. I don’t mind being disconnected from calls with my creditors. But my wife. She was not pleased. Maybe Verizon should fix their miserable cell service and advertise “A Happy Wife Is A Happy Life.” It could replace their last slogan. “Can you hear me now?”

No, I can’t.

Kamala on 60 Minutes

I’ll be back tomorrow.  After I’ve played tennis at 7:00 AM — Harry Newton