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8:30 AM EST Friday, July 28, 2006: Investment choices sitting on my desk:
1. Four startups. Some really neat products.
2. One private equity fund.
3. Two good hedge funds, both of whom should get more money.
4. Some good individual stocks.

The problem is due diligence. It takes time. Lots of it. And right now the sun is shining and the weekend approaching...

The agony of TriPath Imaging:


The ecstasy of Dr. Paul Sohmer. Dr. Sohmer is TriPath's boss. He is avuncular, charming, and patient. He has worked miracles with TriPath, taking an essentially dead company, endowing it with products, giving it a profitable business, bringing in eight quarters of positive cash flow, and building up $24 million in cash. TriPath's business is medical imaging -- using sophisticated scanning equipment to detect cancer early on. It's a booming business. The earlier you detect cancer, the faster you can do something about it. Hence, you can save lives. There are several problems:

1. Medical imaging is not Viagra. It's neither glamorous or immediately rewarding. Most people don't ask for it.
2. The Federal Drug Administration. The FDA is meant to quickly approve useful, life-saving medical procedures. In essence, it's political, subject to passing whims and winds. You can promise your shareholders when your new plant will open, not when your fancy new thing will be approved by the FDA. If you guess wrong, your shareholders will be pissed. Paul guessed wrong. Now he's being ultraconservative in his new guesses and his shareholders are even more pissed. It's hard to please Wall Street when you're guessing the FDA.
3. Legal problems. The TriPath is suing its largest competitor, Cytyc, because it claims Cytyc infringed on TriPath's patents, which Cytyc probably did. But Wall Street hates these legal problems. Cyctc's market cap is also 12 times bigger than TriPath's.
4. Guessing the future. When you run a little public company, you attract a small handful of money managers who think they've discovered in you a way to turn lead into gold. They put pressure on you to make sales and profit forecasts you probably shouldn't. When you don't make their forecasts -- though by most measures you're doing just fine -- they get pissed, badmouth you and/or dump their holdings.

The good news is that TriPath is making excellent progress -- selling more and inventing more. The bad news is that it's not growing as fast as many on Wall Street would like; its FDA approvals on its next product are not predictable (the forecast is for first half 2007, but some of us have our fingers crossed for late 2006); and the patent suit against Cytyc is just beginning -- it may drag on, or, if TriPath's stars align, it may end with a quick victory for TriPath. We'll hear more next week.

Personal confession: TriPath is the only stock I have held in violation of my inviolate 15% stop loss rule. I, too, am a Paul Sohmer junkie. His track record is impeccable -- three companies built, three sold for oodles. I look at TriPath:

1. This is a company with great solid products (financed by earnings), earning money, cash positive, growing and in a hot field. 50 million women each year need diagnostic tests for cervical, ovarian and breast cancer.
2. There are presently 's a huge number of shorts -- 6% of the public float. If those shorts ever scramble for cover, they'll easily bounce this thinly-traded stock several points.
3. TriPath's largest customer, Quest Diagnostic has four million warrants expiring in May 2007 at a price 50% higher than where TriPath's stock presently is. Quest has a huge incentive to do more business with TriPath.

Generally, I, Harry Newton, see a stock price decline, panic and sell. I often do this at the bottom. Looking at TriPath's chart, I see a "floor" roughly where it is at present. I'm losing money on TriPath -- though I am getting educated on Wall Street's roller coaster emotions. It's an expensive education. For now, I'm holding. I cannot predict when my panic will kick in. I remain a Paul Sohmer fan, committed emotionally to him -- though I recognize he is a prisoner of the weird medical imaging world.

The best airline sites: For fares, SideStep and Kayak. For seat selection, SeatGuru.

Economists can't predict either. An early morning story today from DowJones: "The Commerce Department will report on second-quarter gross domestic product on Friday at 8:30 a.m. Eastern. Economists are looking for a sharp slowdown from 5.6% annualized growth in the first quarter to about 3.1% in the second quarter." The results came in this morning: 2.5%, according to the Commerce Department.

Watch your Junk E-Mail filter: If you use Outlook 2003 for your email (and you really should), check its junk E-mail folder regularly, you'll find important emails you want. Tell your friends to check theirs. They'll find emails from you -- often emails with attachments (when emails without attachments sail happily through).

If you find emails from people whose emails you want, right click on an email, go to Junk email and add sender to safe sender list. That will mostly (not always) work. These days I've taken to scanning my junk emails before I delete them. I still find emails I want. Meantime, you should update your Outlook spam filter. It's free. Go here.

Google Labs has some neat free software: You can get a free RSS reader -- a real easy way of keeping up with breaking news from your favorite web sites. You can get an online spreadsheet and some dashboard widgets for your Mac. For more, click here.

Favorite gadget sites: Engadget, Gizmodo, CNET and DPreview for reviews of digital cameras.

Useful statistic? $25 million is spent each year on lap dances in Las Vegas.

Gutsy woman: Wafa Sultan, a woman doctor, was raised as Muslim. She now lives in America and practices psychiatry. Click here. This interview has been viewed on the Internet more than a million times. Speaking of the Holocaust, she said, "The Jews have come from the tragedy and forced the world to respect them, with their knowledge, not with their terror; with their work, not with their crying and yelling."

She continues in the video, "We have not seen a single Jew blow himself up in a German restaurant. We have not seen a single Jew destroy a church. We have not seen a single Jew protest by killing people."

She concludes, "Only the Muslims defend their beliefs by burning down churches, killing people and destroying embassies. This path will not yield any results. The Muslims must ask themselves what they can do for humankind, before they demand that humankind respect them."

Dr. Sultan grew up in a large traditional Muslim family in Banias, Syria, a small city on the Mediterranean about a two-hour drive north of Beirut. Her father was a grain trader and a devout Muslim, and she followed the faith's strictures into adulthood. But, she said, her life changed in 1979 when she was a medical student at the University of Aleppo, in northern Syria. At that time, the radical Muslim Brotherhood was using terrorism to try to undermine the government of President Hafez al-Assad. Gunmen of the Muslim Brotherhood burst into a classroom at the university and killed her professor as she watched, she said.

"They shot hundreds of bullets into him, shouting, 'God is great!' " she said. "At that point, I lost my trust in their god and began to question all our teachings. It was the turning point of my life, and it has led me to this present point. I had to leave. I had to look for another god." Please watch the video. It's short. Click here.

What happens in the desert:
A fleeing Hezbollah fighter, desperate for water, was plodding across the plains of Lebanon when he saw something far off in the distance. Hoping to find water, he walked toward the object, only to find a little old Jewish man at a small stand selling neckties.

The Arab asked, "Do you have water?"

The old Jewish man replied, "I have no water. Would you like to buy a tie? They are only $5.00."

The Arab shouted, "Idiot. I do not need an overpriced tie. I need water! I should kill you, but I must find water first."

"O.K.," said the old Jew, "It does not matter that you do not want to buy a tie and that you hate me. I will show you that I am bigger than that. If you continue over that hill to the east for about two miles, you will find a lovely restaurant. It has all the water you need. Shalom."

Muttering, the Hezbollah fighter staggered away over the hill. Several hours later he staggered back, near collapse.

"What happened?" asked the old Jew.

Replied the fighter, "Your brother won't let me in without a tie."

This column is about my personal search for the perfect investment. I don't give investment advice. For that you have to be registered with regulatory authorities, which I am not. I am a reporter and an investor. I make my daily column -- Monday through Friday -- freely available for three reasons: Writing is good for sorting things out in my brain. Second, the column is research for a book I'm writing called "In Search of the Perfect Investment." Third, I encourage my readers to send me their ideas, concerns and experiences. That way we can all learn together. My email address is . You can't click on my email address. You have to re-type it . This protects me from software scanning the Internet for email addresses to spam. I have no role in choosing the Google ads. Thus I cannot endorse any, though some look mighty interesting. If you click on a link, Google may send me money. Please note I'm not suggesting you do. That money, if there is any, may help pay Claire's law school tuition. Read more about Google AdSense, click here and here.
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