• Jeff Matthews

A Necessary Correction

Friday’s post, “Conspiracy of the Jews?—Part II,” quoted from Overstock.com CEO Patrick Byrne’s mid-December appearance on Christian Financial Radio Network (motto: “Prosperity…For God’s People”).

During that hour-and-a-half interview, Byrne fingered various criminal elements, including “the Israeli mob,” as being “at the bottom” of “every rabbit hole you go down” while pursuing the so-called Naked Short scandal which he believes engulfs his company and others.

I noted in my post with some disgust the fact that a Google web search, which Byrne suggested during the interview would back up a point about the long arm of the so-called “Israeli mafia,” leads to a gaggle of profoundly disturbing web sites from the likes of Al Jazeera, Radio Islam, Lyndon LaRouche and an Auschwitz gas-chamber-denying historian.

Byrne himself responded at length in a Motley Fool post flagged by a reader, and while I am not sure when Byrne’s response appeared it was probably some time after his Friday morning appearance on Bloomberg television, during which he disclosed to the Bloomberg-watching audience “disappointing” revenues for Overstock.com during the holiday season and a “negative” cash flow forecast for the year.

That negative cash flow forecast appears to be sharply at odds with at least one of Wall Street’s Finest (Craig Bibb of WR Hambrecht), whose last model (December 13) shows precisely $42.098 million of expected positive “Cash flow from operating activities” for Overstock.com in 2005.

Thus Byrne’s Friday morning disclosure appears to be a change of guidance compared to Wall Street forecasts, even though such disclosures are, I believe, supposed to be offered in 8-K filings with the SEC and not on Bloomberg TV according to my understanding of Regulation Fair Disclosure. Regardless, in Byrne’s Motley Fool dismissal of “Conspiracy of the Jews?—Part II”), Byrne claims that he brought up so-called Israeli mob involvement in the ecstasy trade merely in response to a question from the interviewer about the reality of an Israeli mob. Patrick writes:

Jeff omits precisely the part of the quote that makes the connection, and that is, after I mentioned the Italian, Russian, and Israeli mobs, and discussed the Russian mob, the interviewer said/asked, “I didn’t know Israel had a mob?” To which I replied that, yes it does: for example, it is widely thought to control the US ecstasy trade. And that is where a correction is due: what Patrick wrote is not correct.

You can listen for yourself to the sequence of what Byrne said at http://cfrn.net/investigates/, but here is an approximate timeline of Byrne’s comments on that broadcast, about 13 ½ minutes into it: 13:35 “The Israeli mob and the Russian mob are the two ones who scare me…I think the Italian mob is part of this, but they’ve gone quasi-legit as far as Wall Street…”

The interviewer concurs with Byrne’s comment on the Italian mob going “from concrete to Wall Street,” and Byrne continues by bringing up the ecstasy trade issue:

14:15 “The Israeli mob—in fact I was just reading Ha’aretz, which is an Israeli newspaper, ah, and a very good one, and you can Google this– If you Google ‘ectasy Israeli mafia’ you’ll find articles that basically the Israeli mob…is thought to control 75% of the ecstasy trade in the U.S.”

It was not until after this, at 14:40, that the interviewer says, “I didn’t know there WAS an Israeli mob,” to which Byrne responds by launching into a bizarre and inaccurate discussion of Israeli extradition laws:

14:45 “Ah, well…in fact they are about to, they are about to, they are considering extraditing someone from Israel, and you know, Israel, I think it’s part of their constitution, or it’s one of their basic laws that if they, if a Jewish person reaches Israel they just never get extradited, and in Israeli history they’ve only extradited two people…” Byrne compounds this whopper—which is not true—by expounding as follows:

“One is this fellow, I’m blocking his name…he oversaw the smuggling of 30 tons of MDNA, or ecstasy, into the United States…. The last time and only other time they ever did this was Meyer Lansky…”

For the record, it is not true that “if a Jewish person reaches Israel they just never get extradited.” And it is not true that “the last time and only other time they ever did this was Meyer Lansky.”

Eddie Antar—the famous fraudster also known as “Crazy Eddie”—fled to Israel in 1990 but was extradited from Israel in 1993.

Mail-bombers Robert and Rachel Manning were extradited and returned to the U.S. in 1993 after seeking safe haven in Israel.

The fact is that the Israeli law which Byrne claims does not allow extradition actually frowns on those who commit crimes before seeking Israeli citizenship under the “Law of Return.”

How do I know all this? I Googled it. Took ten minutes, max.

Tomorrow we move on to more interesting—but not necessarily more important—topics than setting right these inaccuracies. Jeff Matthews I Am Not Making This Up

© 2005 Jeff Matthews The content contained in this blog represents the opinions of Mr. Matthews. Mr. Matthews also acts as an advisor and clients advised by Mr. Matthews may hold either long or short positions in securities of various companies discussed in the blog based upon Mr. Matthews’ recommendations.

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The content contained in this blog represents only the opinions of Mr. Matthews. This commentary in no way constitutes investment advice. It should never be relied on in making an investment decision, ever. The content herein is intended solely for the entertainment of the reader, and the author.

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