Falsifyingly Herbalife

John-Hempton-Herbalife-Stockpiler

Herbalife is a fucking scam built to bilk poor people.

Whether or not it’s a proper “pyramid scheme” :: as currently defined by the FTC … is a moot point. The FTC doesn’t care about their own blurry pyramid standards :: so why should anyone else care? But that pyramid question is the one that the “we don’t hire women” assholes of Wall Street have their man-panties all in a knot about.

Let’s slap them around a bit to illustrate some wider points about the MLM monster :: which must be slain in order to save America’s soul from the Kraken. Not that I really give a fuck about any of their secondary market opinions :: or what happens to any of the money they manage for the Top 1% … but smacking around some smart people will be a refreshing change of pace from the barely literate Ed Dale / Crystal Cox type dummies I normally abuse around here.

And let’s start with Bronte Capital :: which has nothing to do with Emily and Charlotte … cause even allusions to women are disapproved at the Wall Street sausage party. Bronte’s chief sausage John Hempton has falsified Bill Ackman’s pyramid thesis :: using the pretend science of looking for people dumping shake powder on Craigslist … or “Craigs List” as Hempton inaccurately labels the newspaper destroying classified site five times in a single post … like the fucking web expert that he isn’t.

But we can be certain of one thing: Herbalife is not a pyramid scheme in the sense promoted by Bill Ackman. We can take the 300 page Bill Ackman presentation and throw it out. Falsified…

And any journalist (Michelle Celarier) who continues to take Bill Ackman seriously on this issue has disconnected from reality.

Yeah :: shut up you stupid lady reporter  … who invited you anywayz?

In real science :: the only thing one can be certain of is that one can’t be certain of anything … but in head-up-own-ass pretend Wall Street science we can be certain of whatever … as long as we’ve spent a few minutes trolling “Craigs List” first.

“If I was a failed distributor I might have $2000 worth of this getting old on my shelf. I might (reasonably) want to recover some money. So I would sell it.

Where? Craigs List or Ebay.

If I found lots of desperate distributors – failed ones – selling it on Ebay then Bill Ackman is probably right. If there are no such people then Bill Ackman is wrong. Simple test.”

A simple test :: super fucking stupid … but simple.

Long story short :: during the time that John Hempton spent searching the online classifieds … he didn’t find a sufficient number of distressed sellers {dumping Cookies n’ Cream flavored Formula 1} to meet his exacting standards of measuring … and stuff.

Thesis falsified :: simple … science!

Of course if John Hempton was a failed Herbalife distributor :: then statistically speaking … he would be an hispanic person … without a college degree … living a scary paycheck to paycheck existence full of fear about the future. He would have been convinced by the absolutely fraudulent claims of his upline :: that Herbalife was the miracle solution to his intractable problems … and he would have dropped a jack-load of money he didn’t have chasing that unicorn against the advice of almost all of his loved ones {aka … dream stealing haters} … alienating and humiliating himself in the process of losing everything.

Which is to say :: rich money manager John Hempton has no fucking idea what the hell he’s talking about … and should STFU ASAP.

Here are a few dings to the certainty of your science Hempton …

— What if the mid-to-upper level distributors who would be responsible for the bulk of the dubious paycheck buying & stockpiling type activity :: know that the product is a front for the business opportunity … and don’t want to smear dirt all over the unicorn by selling the front product at desperation discounts?

— What if the vast majority of the world’s population don’t know how to sell something on eBay?

— What if when you’re sucked into MLM :: the amount of money you’ve lost buying shake mix is NOTHING in comparison to the total amount of money that you’ve lost?

— What if many failed Herbalife distributors learned by failing :: and so already know {unlike John Hempton} how impossible it is to sell this shite on eBay … at any fucking price. Because hey :: maybe most people don’t want their bulk health shakes to come secondhand and soaked with the stench of someone else’s abject failure.

— What if HLF donates bus loads of their dumb junk :: and calls it charity … or childhood nutrition? Cause … they do.

— What if Shawn Dahl owns this self-storage facility :: and a dozen others like it? Cause … he does.

But let me explain it to you another way Bronte Capital’s John Hempton :: using a parable instead of science … like Jesus would do.

You :: a rich :: disconnected from reality :: totally out of touch white asshole … are at your favorite club in Sydney drinking Cristal {or whatever totally out of touch white assholes drink in Sydney}. You’re wearing your favorite $500 blue jeans :: because you think they make you look taller … and you wish you were an American. Unfortunately :: the slutty sexiness of your American pants is just too much for some Aussie pervert to resist … and you get semi-raped {just a dry hump} in the bathroom.

The semi-rape is quickly over :: but the associated mental trauma is long-lasting.

Once you finally start feeling a bit better :: do you …

a) spend a couple of days trying to sell your fancy American jeans on eBay :: taking photos :: writing a description …

“Great pants, will make you look taller. I paid $500 but will let them go for $50. It wasn’t their fault. The horror. Free shipping.”

… all while reliving the experience in vivid detail

… or …

b) throw the guilty jeans out with the trash … and immediately start wearing hoodies and canvas cargo pants?

Oh oops :: gosh … looks like I just falsified your thesis that the thesis has been falsified with my own {three word} thesis …

Trash cans exist.

Simple.

Science.

So why don’t you spend a couple of months {soul} searching through the garbage dumps of Latin America John Hempton :: and then report back to us on the status of your fucking falsifying. Please try to pick me up an Equinox water filter while you’re out there though :: cause I can never find enough of them on eBay.

>> bleep bloop

39 thoughts on “Falsifyingly Herbalife”

  1. God I hope those Bronte people read this. This is the truth.
    Keeping up with the Herbalife saga is like reading a mystery thriller and knowing who did it….and everyone in the story is confused and DOESN’T GET IT. And Salty Droid is the guy shaking shoulders screaming “DON’T YOU GET IT!?!?!?!”

    1. @fs, The recent retweet in the twitter account below might mean that they will read it….

      https://twitter.com/John_Hempton

      However the internal battle they will face to understand the issue will be hubris, arrogance, greed, self confidence and stubborness versus humility, open-mindedness, and the ability to admit being wrong. The scales are not tilted in favour of the real story getting out.

      Also, a typical hedge fund manager might not have the creativity of mind to associate the “jeans / club” parable to Herbalife, which abuses victims in everyway, and might only get the hump about the salty language.

  2. @fs,

    and everyone in the story is confused and DOESN’T GET IT.

    I think a lot of them “get it”. They just don’t want to so they pretend not to. They want to bury their heads in the sand and keep makin’ money off o’ the ol’ Herbalife stock.

    ——-

    @SD: agreeing totally with the what ifs… especially the last one.

    If I’d just spent a stupid amount of money on “product” during a temporary state of lie-induced euphoria… and if I’d just spent a solid month trying to sell the crap. It would not now occur to me to hock it on eBay at a modest price. That’s what a business might do, but Real Live Human Individuals who are now realizing that they’ve just been conned don’t think like businesses. Especially neither do people who are still believing in the magic and are suffering some sort of depression now thinking that they just don’t have what it takes. It’s Epic Dumb of John Hempton to think that they would.

    Hmm.. I wonder if I could recruit John Hempton into my downline. I mean after all–he’s pro-MLM. He’s got money. He should be more than happy to buy a bunch of shake mix from me to support my (fake) cause.

    ——

    But seriously-ish, lastly, and maybe a bit more importantly: @SD you always do that thing where you cram lots of links in. I miss many of them often. Regarding the storage thing, at first I misread you. I thought you were saying Shawn Dahl owned a storage room. But that’s not what you said. You said, and the SEC thing shows that Shawn Dahl owns (not rents)
    a fucking lot of self storage facilities.

    It’s kind of insane. It’s kind of perfect if you’re Shawn Dahl. He might not have any Herbalife stocked up there. But he probably has, you know, “tonnes”. Probably not just his, but a few other peoples’ as well. Those that are close to the top of the pyramid.

    I wonder if he owns any incinerators.

    “Trash cans exist.”


    Furry cows moo and decompress.

  3. John Hempton clearly didn’t look too hard. There are 4,731 results for herbalife on the ebay site. Prices range from ninety-nine cents, with free shipping, up to $435 for a “Herbalife Shapeworks Shapescan Body Analyzer Programmed in English”, also with free shipping. And that’s just in the United States.

    Could it be that Hempton is a lying sack of shit? Hmm…makes you wonder.

    1. @Barbara,

      Could it be that Hempton is a lying sack of shit? Hmm…makes you wonder.

      It’s a distinct possibility I’ve been seriously pondering.

      If you look at his follow up articles though it seems more likely that he’s just practicing deep, deep self-deception. I leave it to others to decide if this is meaningfully different from outright, straight-up lying-through-your-teeth-on-purpose fraud.

      The motivation for lying to himself would most likely be $$$ of course.

      It used to be (and still mostly is) that the rich get rich and stay that way off the suffering of the poor, unwashed masses. But you know it a fancy country like the U.S. no one really wants to see poor people suffering.. {because it’s unsightly. There might be cooties. How can I enjoy my $100 restaurant meal when the no-health-care grubby bum outside keeps coughing so pneumonia-ishly all over?}

      So now we moved the suffering out of the streets and into peoples’ bank accounts so we don’t have to actually see the misery and pain.

      E.g.: Keep up that brave smile, Herbalifer. Surely this MLM will be the one that lets you make bank. Fake it till ya make it.

      “Herbalife Shapeworks Shapescan Body Analyzer Programmed in English”

      That would be an excellent line in a spam poem.
      http://en.wikipedia.org/wiki/Spoetry


      Furry cows moo and decompress.

    2. @Barbara,

      There are three kinds of lies: lies, damn lies and statistics. Hempton is employing the latter.

      Pershing Square, December 20, 2012, proving Herbalife is a pyramid scheme:

      http://www.flickr.com/photos/24320537@N06/9404918258/

      Bronte Capital, July 23, 2013, proving Herbalife is not a pyramid scheme:

      http://www.flickr.com/photos/24320537@N06/9402160061/

      Seven months after Pershing Square and their third-party researchers showed the modest discount on Formula 1 on eBay, Hempton proposed the hypothesis that mega-discounts on Formula 1 on eBay would prove Ackman’s thesis – that Herbalife is a pyramid scheme. When he found the null hypothesis – no mega-discounts on Formula 1 on eBay – to be true, he then jumped to the conclusion that Ackman’s thesis is false – that Herbalife is not a pyramid scheme.

      Considering what Pershing Square told us about Formula 1, it’s not surprising that it retains 66% of its value in the supply-and-demand-driven eBay market. Formula 1 is Herbalife’s most popular product; they produce $1,800,000,000 worth of it each year. It competes with mainstream manufacturers’ brands including Unilever’s Slim-Fast and Abbott Labs’ Ensure. Herbalife has the highest price per serving, and next-highest-priced GNC shake mix retails for 40% less per serving. With the discount, Formula 1 is basically at the market rate for this in-demand commodity product.

      {I confirmed this on my own. When I search “herbalife formula 1” on eBay (logged in, in Chicago) and sort the 2,055 results by Price + Shipping: lowest first, the cheapest I see for unopened powder in the current packaging is $10.00 for 750g with 6 days left for bidding to drive the price higher. I can buy a bizopp sales pitch for $1 or some spoons or empty plastic containers for $5, but I’d have to pay the market rate for fresh, unopened shake mix.}

      Hempton says that the people selling Formula 1 on eBay are successful distributors, not failed distributors. I don’t argue with that. He says they sell it at a 35% discount because they can get it at a 42% or 50% discount and still make a profit by selling it at a 35% discount. I say they get it for free by paying for their paychecks, so it’s all profit. They don’t want to devalue their bizopp scam’s flagship product, so they don’t offer the kind of mega-discount Hempton was looking for. To appeal to the supposed “‘discount buyer’ distributors,” they have to offer a better discount than 25%. To appeal to non-brand-loyal shake powder buyers, they need to approach the market price set by GNC and others. The 35% discount satisfies both.

        1. @SD,

          If you ban me … I will ask Jason to reboot you in “safe mode” and un-ban me.

          Loop that through your processors, Droid.

  4. People are trying to get rid of all kinds of MLM crap online. Kevin Trudeau’s Global Information Network upsell, Your Wish Is Your Command, is going for pennies on the dollar on some sites too. Type in just about any other MLM company, including those that sell something besides worthless infofraducts, and you will probably find scads of people trying to unload the merchandise. Some people can’t get rid of that crap fast enough.

    Anyway, thank you, @SD, for another entry in the annals of MLM evildoing. I probably could have worded that better but I am in a hurry.

  5. Herbalife Sends Bill Ackman Whining to Loserville as Carl Icahn Rejoices

    “Herbalife Ltd. (NYSE: HLF) is accomplishing two key things this morning after its quarterly earnings report. The first key accomplishment is that the stock hit a new 52-week high of $66.23, and shares are still up over 6% above $64 in very active trading volume. The second thing that the vitamin and supplements distributor is accomplishing is that it is absolutely crushing short-selling activist Bill Ackman’s Pershing Square.”

    This was posted today.

  6. Yep, I just looked at Ebay.com – God, the deep thought that that required – and found 4000 Herbalife products. Can’t remember what I typed in – ummm – oh yes. Herbalife.

  7. Barbara, the LA Times was covering how Ackermans’ strategy was ‘crushing him’ because Herbalie hasn’t tanked and burned yet. It was a few days ago, ahead of the earnings report.

    The only MLM business I ever heard of that wasn’t a scam was Barclays, which was a company in the Philippines, not the British banking giant. They sold soap and detergents, and they had rallies like does. However, people weren’t over-promised what kind of income they could make, and people who did it were usually government employees who were underpaid, and needed a second income. They gave people t-shirts for reaching sales goals, kinda like when we used to do magazine sales in jr hi to raise money for the school where we’d get prizes for 10 or 20, etc subscriptions sold.

    1. @InTheKnow ::

      Yeah … some of those comments are pretty fucking highlarious. Maybe there’s some hope for my old home yet.

  8. Pyramid standards are the biggest among many problems inhibiting FTCs enforcement of consumer protections against MLM abuses. Whether or not any company can classify the requisite percentage of sales as “retail” is nothing more than a red herring to which the commission has been susceptible since the 1979 Amway case. It’s unclear if Amway purposely concocted “pyramid standards” to suit their purpose. However it’s served the MLM industry well in keeping the the FTC at bay. Any MLM relying on the promise of exponential growth to recruit distributors (are there any that don’t?) is running a pyramid scheme.

    In fact, conceptualization of exponential growth progressions as anything remotely resembling a pyramid is simply fallacious. A binary growth model (one recruits two who each recruit two who each in turn recruit two and so on), can only reach 32 levels before the entire population of the planet–every man, woman and child–is exceeded…not really new information. But if one graphs the same model such that each level is represented as one inch high and each recruit is represented as one inch wide the resulting figure is 32 inches tall and 67,786 MILES wide–essentially an extremely long flat line with an imperceptible peak in the middle. By any reasonable analysis, such a growth pattern is completely unsustainable. MLM proponents will try to throw wrinkles into this mathematical reality; but the core principle remains unchanged. If a trinary or greater model is used, as is the case with most MLMs, the line is even flatter.

    Statistically, 997 of every 1,000 MLM recruits will sustain a net loss over the course of their involvement.

    Until the Commission recognizes they’ve been sidetracked by a red herring and understands that the MLM model is, in all cases, flawed, they’ll remain paralyzed in their enforcement of consumer protections against MLM abuses.

    I’ll concur with whatever profanity Salty Droid applies to this unfortunate circumstance.

    In my opinion, the least costly way to curb MLM fraud is for the FTC to mandate and monitor accurate disclosure of historical income data to prospects by those seeking to recruit them into any MLM “business (bankruptcy) opportunity. The industry contends that such disclosures would severely impede their ability to recruit distributors…No shit! And they’ve successfully lobbied MLM’s exemption from the disclosure requirements of the Commission’s recently promulgated Business Opportunity Rule. Interesting posture for an industry that promises incredible wealth to its prospective distributors. If their promises were well founded, it sorta seems like they’d jump at every opportunity to trumpet them.

    1. @Roger Willco,

      In my opinion, the least costly way to curb MLM fraud is for the FTC to mandate and monitor accurate disclosure of historical income data to prospects by those seeking to recruit them into any MLM “business (bankruptcy) opportunity. The industry contends that such disclosures would severely impede their ability to recruit distributors…No shit!

      Spot on. The wretched quagmires of virally spread misery would have to report the reality (a.k.a 997 out of 1000 recruited making a loss). No amount of love bombing and happy clappy meetings would be good enough to paper over the clearly reported reality. And the MLM / pyramid companies would fade away into nothing. Zilch. Zippety doo. I hope the FTC reads your suggestion, and implements! It really would not be too difficult. The FTC would for once be effective, and get a better rap. The FTC bowing to allow reduced disclosure requirements is pathetic, and makes one really wonder the extent to which the FTC is in league with scammers.

      1. @Random stuff,

        No need to wonder…There’s ample evidence that the FTC has been captured by the MLM industry and the Direct Selling Association (DSA), MLM’s extremely well-funded and effective lobbying body. Evidence includes documented ex parte contacts between FTC staff and the DSA during the public comment phase preceding final drafting of the current Business Opportunity Rule. It’s also enlightening to read commentary posted online by one of the industry’s leading attorneys:

        http://www.jdsupra.com/legalnews/cnbccom-cites-legal-expert-jeffrey-bab-25138/

        http://www.mlmlegal.com/FTC%20Business%20Opportunity%20Rule/FTCFinal%20Bus%20Opp%20Rule.html.

        These 2012 and 2013 documents makes repeated references to the cooperation, goodwill and good rapport that exists between the industry and the FTC. While this commentary doesn’t constitute a slam-dunk admission of agency capture, it’s perilously close; and it indicates the sort of relationship I’d hope wouldn’t exist between an industry and the government agency charged with regulating it.

        1. @Roger Willco,

          it indicates the sort of relationship I’d hope wouldn’t exist between an industry and the government agency charged with regulating it.

          You mean like with the banking system or Big Oil? Yeah.

          1. @Wyrd ::

            The trouble is that oil and banking are economic essentials. It says something so much scarier that our government could be captured by something so absolutely illusory and unessential.

            This dipshit John Hempton keeps making a comparison between Herbalife and the tobacco companies. Sure cigarettes will kill you :: but as any former smoker {Jason raises hand} will tell you … you’ll have loads of awesome fun in the process. Cigarettes are a real thing … that real people want.

            Lies are not something people want. Fraud is not something that people want. If the government can be captured by the criminals peddling such fucking emptiness :: what hope can we have for them in all these other subtler areas?

            #depressing

            1. @SD,

              Lies are not something people want. Fraud is not something that people want. If the government can be captured by the criminals peddling such fucking emptiness :: what hope can we have for them in all these other subtler areas?

              #depressing

              …but thankfully his site is #notdepressing.

              Just as it lets people know the reality behind the lies – and prevents large numbers of people from being scammed, or being sucked into the MLM / internet marketing / pyramid / brainwashing machine – there is a hope that someone at the FTC, and/or a member of congress, and/or more decent journalists (beyond the handful that already have) might suddenly ‘get it’ and take up the baton. There are decent intelligent people around, as well as the ‘gravy train’ers’ and the ‘job’s worth’ers’.

        2. @Roger Willco,

          Thank you. Those links are indeed enlightening, perhaps to be expected, but dissapointing never the less.

    1. @Jim,

      Yes. And turtles. He uses turtles for reference sometimes, and it gets a little bit funnier every single time. And Jokes, he’s a good Spreader of Jokes That Hurt Because There’s Too Much Painful Truth In Them or something like that.

      It’s an HHOS [Ha Ha Only Serious] thing:

      http://www.catb.org/jargon/html/H/ha-ha-only-serious.html

      Applied especially to parodies, absurdities, and ironic jokes that are both intended and perceived to contain a possibly disquieting amount of truth,
      . . .
      For further enlightenment on this subject, consult any Zen master.

      That entry’s supposed to be all about hackers (in the computer enthusiast sense not the computer criminal sense), but I find a lot of it applies to non-hacker areas of life. Or maybe that’s just me.


      Furry cows moo and decompress.

      1. @Wyrd,

        Yes, we need more of the truth, considering how much falsehoods certain kinds of people are perpetrating.

        I want to advertise a great book by Dr. George K. Simon. The book’s name is Character Disturbance. I wonder if Salty Droid has read it at some point. People definitely need to be more conscious of disquieting truths and able to digest them. Me saying it here obviously ain’t going to do jack. I just wish there were more people like Salty Droid knowing how to handle all these people, who are only interested in feeding their leech-like egos.

  9. Hempton is basically applying his own blindspots to Herbalife and claimed his blindspots are “better” than Ackman’s blindspots. Phooey.

    Hempton went to inspect a diet club in January 2013 after Ackman’s speech, and came to believe that is the value that Herbalife is offering through those clubs.

    Diet clubs was not even a sanctioned sales method at Herbalife, and was started in Mexico in 2003 and backfilled into the US via the Latino communities. Diet clubs are NOT allowed to put Herbalife logo outside. They are NOT sanctioned, merely tolerated. So what was herbalife doing for 23 years before that, hmmm? And who deserves the credit for the clubs, when it’s surely NOT herbalife?

    http://amlmskeptic.blogspot.com/2013/07/what-herbalife-apologists-are-ignoring.html

  10. I learn something new every day. Or more accurately–I frequently read or hear something that causes me to look again at something and see it more clearly.

    http://www.businessweek.com/ap/2013-10-03/herbalife-shares-fall-as-ackman-readjusts-position

    I understood about the Ackman / Icahn battle/sideshow and how, for Icahn’s part, it was fueled not so much by his certainty in Ichan’s non-scamminess, but more by his not caring if it’s a scam if it looks to be a solvent scam and his hate/rivalry/whatever with Ackman.

    So I knew that part. But what I didn’t totally get was that *mild sardonic chuckle* Ackman’s aggressive bold position was itself at least partly responsible for driving up Herbalife’s price.

    So knowing that then the news of the day makes sense–that now that Ackman has backed away from his short position to something less extreme, Herbalife’s price has dropped.

    For the record, from the above-linked article

    “While we have endured mark-to-market losses on this investment as Herbalife bulls have promoted the stock and downplayed the probability of government intervention, we believe it is only a matter of time before the company is shut down and prosecuted by regulators,” Ackman stated.

    Hard to believe it’s only two months shy of 1 yr on this thing.


    Furry cows moo and decompress.

    1. @Wyrd,

      In the above, in my tangled sentences, where I wrote “not so much by his certainty in Ichan’s non-scamminess”

      What I meant to write was “not so much by his [Ichan’s] certainty in Ichan’s Herbalife’s non-scamminess”

      But you know– Ichan-Herbalife.. Herbalife-Ichan… they sound almost the same. So you can see how I could get confused.

  11. I FUCKING LOATHE mlm….but, I gotta admit, all u fucking pussy dems. HATE mlm so much,…………that maybe, just maybe, there mite b something to them…..maybe they are simply DIFFICULT, A WAY OF MAKING CASH THAT makes the participant have to really work hard, to hustle………so, that would be the reason that you fags hate them so much…an EFFORTis required,….everyone DOESNT AUTOMATICALLY win.

  12. the new Ackman documentary is good.
    http://www.factsaboutherbalife.com/former-herbalife-distributors-in-their-own-words/

    one moment struck me: several former distributors express the extreme guilt they feel – at having CAUSED OTHERS to lose money, by recruiting them into the scheme. they feel anger and embarrassment at being fleeced and manipulated by herbalife, but also guilt and horror at FLEECING and manipulating others, at herbalife’s behest.

    it reminded me of this thread, and how misguided it is to think that victims of herbalife could process the experience in a rational, businesslike way. imagine selling your old shake canisters on eBay, and the fear that one of your own downline victims might see the auction, and blame you for their own losses and pain…

  13. The 100% return guarantee has been in force for at least some time now. There is absolutely no need for anyone to use Ebay to sell product which they could not sell themselves. If returns to Herbalife under this guarantee continue to be extremely low that would indicate that there aren’t many distributors that are stuck holding product which they couldn’t sell.
    It’s a lot of fun to poke fun at hedge fund managers but that is not a convincing argument. Anecdotal evidence is likewise unconvincing.
    Please explain the lack of returns of product to Herbalife – 1% or less is the figure I think. How can there be inventory loading like you assume given this information?

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