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aion-rsa · 5 years

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What's Next for Marvel's X-Men in Dawn of X

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House of X and Powers of X have concluded, so it's on to the future of the Marvel Universe, mutants, and the X-Men!

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This article contains major spoilers for Marvel's X-Men reboot, House of X and Powers of X.

House of X and Powers of X are now complete, and the event, which was billed as a huge reset for the X-Men comics universe, did everything promised. It took a major retcon for one of its characters and used it to reposition the X-Men concept in the greater Marvel Universe, reinvigorating the mutant metaphor and seeding years of stories that changed the past, present and future of the entire world. The changes are dense, and can be confusing, so we picked through all 12 issues to figure out what you need to know heading into Dawn of X.

What Happened in Hosue of X and Powers of X?

The two books took different tacks to lay the groundwork for the X-Men’s big changes. Powers of X looked at four different timeframes on exponential scales: X^0 took place generally 10 years before the present day of the comics continuity; X^1 is present day; X^2 looked 100 years out; and X^3 looked 1000 years down the road.

With one exception, House of X focused on the X^1 timeline, the present day of the current Marvel Universe. That one exception was a doozy, though.

House of X #2 dropped a MAJOR retcon on Moira MacTaggert, until now a human geneticist ally of the X-Men. HoX #2 revealed that Moira was a mutant, and each time she died, her consciousness was transported back to herself in the womb, resetting the timeline, leaving her with perfect recall of her past lives.

Moira’s first two lives were uneventful: she lived a happy life, not realizing her power activated at 13, and died surrounded by family, and then died again after figuring out she was a mutant.

read more: Key X-Men Comics to Read for House of X and Powers of X

Her third life was spent trying to cure herself of her mutant gene, and right as she succeeded, her lab and lab partners were blown up by the Brotherhood. Destiny, Mystique’s precog partner, saw what would come of the cure - weaponization by humans - and she saw Moira’s power. She also saw that Moira’s cycle would end if she died before her power activated, so she told Moira to stop trying to fight mutants and had Pyro burn her to death to make sure she remembered.

Her fourth life was spent trying to help: she married Charles, and X-history progressed about as it did in the 616 before ending in a sentinel massacre. Life five saw Moira push Charles into an isolationist pose early, but that one ended in robotic hellfire too.

Moira’s Sixth Life

Moira’s sixth life was depicted by the X^3 timeline in PoX. She and Wolverine lived for a thousand years, with the robots somehow figuring out that she needed to be kept alive or she would reset the timeline. They lived in a wildlife preserve, maintained by a new branch of human evolution: Homo novissima, a fusion of humans and machines.

The Librarian, our POV character, is part of a society trying to ascend to join the Phalanx, an intergalactic machine intelligence so dense it’s about to collapse into a singularity. If they do collapse, that would make the machines knowledge of this life separate from space and time - when Moira resurrects, they would know and be there - winning the war for the machines forever. However, before the ascension is complete, Wolverine stabs the Librarian in the face, then kills Moira so she can reset.

read more - The Best Episodes of X-Men: The Animated Series

Her experience in the sixth life radicalized Moira - she’s certain if the war even starts, the mutants always lose. She spent life seven going full Rambo, killing every Trask she could find before they could create the Sentinels. Unfortunately, AI is like fire - a discovery, not a creation - and she died at the hands of a wild jungle Mastermold. In life eight, she convinced Magneto to go to war with the humans, but she died after he was stopped by an army of superheroes.

Moira’s Ninth Life

The only major mutant figure Moira had yet to ally with by this point was Apocalypse, so she awakened En Sabah Nur early in her ninth life and went to war. This life was largely depicted in the X^2 timeline, and bore a strong resemblance to the Age of Apocalypse: many of the traditional Marvel heroes along with Xavier and Magneto were defeated early on by Apocalypse. Apocalypse and Mister Sinister used rampant genetic engineering to create a mutant army, but they were still losing.

Because of her experience in her sixth life, Moira had flagged the emergence of Nimrods as a paradigm shift in the war with the humans - Sentinels “bought the humans years,” as the Librarian told her, while “Nimrods bought [them] decades.” So to prevent this from coming to pass, Apocalypse’s crew stages an assault on a machine data storage facility to get precise knowledge of how Nimrod came to be. Having that data, it was given to Moira, absorbed immediately, and she was killed by Wolverine so she could be reborn.

Moira X, or the modern Marvel Universe

Moira went to Charles again for her tenth life, which covers the X^0 and X^1 timelines. This time, she said, they would try something different: all mutants together. The X^0 scenes in PoX looked at Charles and Moira recruiting Magneto, and then Magneto and Charles recruiting Sinister and Forge to their new mission: finding a way to put all mutants together in their own fortress, and a way to keep mutants from ever dying.

They bring all mutants to Krakoa, their new fortress (ALL mutants - heroes like Marvel Girl or Cypher; villains like Apocalypse or Gorgon; even dead ones like Xorn or Sophie Cuckoo). They use Krakoan fauna to create three drugs - to cure most illness, heal mental trauma, and extend human life by five years - and then use those drugs as leverage to gain UN recognition for the island and amnesty for any mutant in the world.

read more - Pryde of the X-Men: The Animated Series We Almost Got

The mutant island’s formation triggers the Orchis protocols: a gathering of human scientists with the goal of creating machine defenses for humanity. They’re joined by Karima Shapandar, the Omega Sentinel and erstwhile X-ally, as they repurpose an old Iron Man dyson sphere to build a Mother Mold - a Sentinel factory that builds other Sentinel factories. Charles and Magneto believe this is the moment that Nimrod emerges, so they send a team to destroy it before it comes online.

That raid turns out to be a suicide run: Penance, Cyclops, Archangel, Marvel Girl, Wolverine, Nightcrawler, and Mystique are all killed ejecting Mother Mold into the sun as it wakes up.

But they have a way to cheat death, as well. They die in horrible ways in space, but are almost immediately brought back by The Five:

- Goldballs, a mutant introduced in Brian Michael Bendis’ Uncanny X-Men run with the power to...shoot gold balls out of his chest. In House of X #5, we found out they’re actually eggs.

- Proteus, the reality warping child of Moira and Joe MacTaggert, who would tweak the eggs to match the bodies of the deceased mutants. He was a big X-Men villain from right before the Dark Phoenix saga, who now uses husk clones of Charles as fresh bodies when his power burns out the old one.

- Elixir, an Omega mutant from the Academy X days with the power to heal completely (or kill) with a touch.

- Tempus, another Bendis creation, with the power to manipulate the flow of time who could age the bodies to their peak age.

- And Hope Summers, the first mutant born after the Scarlet Witch depowered 98% of all living mutants in House of M, with the power to mimic other mutants and smooth out the application of their powers in themselves.

After the celebration of their resurrection, a ruling council is named: Xavier, Magneto, Apocalypse, Marvel Girl, Nightcrawler, Storm, Emma Frost, Sebastian Shaw, Exodus, Sinister, and Mystique. The series ends with a Return of the Jedi-style celebration on Krakoa.

The Unanswered Questions of HoXPoX

One of the most impressive things about HoXPoX is the sheer volume of ideas dumped into the books that are left for Dawn of X titles to eventually pick up and run with. It’s reminiscent of classic X-Men stories: when the comics first became the cultural juggernauts they grew into, plot threads were left dangling for years, even decades, for other creators to tease out in their own books. This interconnected continuity made X-Men fandom a community in ways other comics didn’t ever manage to pull off. What follows are some of the ideas on the table that caught my eye.

Omega Sentinel and the Real Path Forward

Karima Shapandar is on the Orchis base and helps the humans kill Cyclops and Mystique, but she is clearly uncomfortable with her role there - when Nightcrawler runs into her on the base, she’s almost bitter about how she’s being excluded from Krakoa. Moira’s plan for the mutants is “everyone together,” but the one thing they haven’t tried in all her ten lives is allying with the machines. This feels prominent.

read more: X-Men Movies Watch Order

Nimrod

Mother Mold came online as Wolverine was hacking off its supports to drop it into the sun. It regaled Logan with a speech about how the humans and the mutants were both failures, and the machines will burn them both. This tracks with Nimrod and Omega’s attitudes in life 9: they fight the mutants, but they have a powerful dislike for humans as well. The point here is that Nimrod is almost certainly online.

Arrako and Apocalypse’s History with Krakoa

Powers of X #4 gave us a brief history of Krakoa - it was originally one island, Okkara, that was split in two by an invasion from what appeared to be Limbo, a realm of demons. The demons were repelled by Apocalypse and his first horsemen, and Krakoa was left on Earth, while Arrako and possibly the first horsemen were sealed away in another realm, with the first horsemen standing guard in case of another invasion. With Apocalypse now on Krakoa, this almost has to be addressed.

Chekhov’s Mutant

The first act of the Quiet Council was to set out the three baseline rules for living on Krakoa: respect the island, make more mutants, and no killing humans as they can’t be resurrected. Sabertooth was convicted of violating the final law for the murders he did, specifically against Magneto’s orders, in the heist in House of X #1 to steal data about the Orchis base. His punishment was not death, as that would have placed him in resurrection protocols. Instead, he was swallowed by Krakoa to be kept in stasis for an indefinite period of time.

Cypher’s Arm

Doug Ramsey’s first appearance in the series had him sporting a fancy, techno-organic arm. His best friend in New Mutants was Warlock, a mutant technarch and member of the race we now know as the beings who sweep up organic material for the Phalanx to power their ascension. When he first visited Krakoa, his T-O arm brushed Krakoan fauna, and it looked an awful lot like he infected the island.

Sinister

Sinister betrays mutants in every timeline. Every single one.

Namor and Atlantis

Namor was long considered the first mutant (until the various Apocalypse retcons started pouring in). He’s also the king of Atlantis, the country that exists undersea and thus, beneath Krakoa. He declined Charles’ invitation to join them on Krakoa, but he’s still out there lurking. And he’s got a long history with powerful blonde women.

The Red King

There’s one seat on the Quiet Council of Krakoa left unfilled. The Hellfire Club’s table has a space reserved for a Red King (with Emma Frost being the White Queen and Sebastian Shaw as the Black King). The identity of that Red King has been teased, but not detailed yet.

The Tarot Cards

Powers of X #1 introduced us to a tarot card reading for Moira that happened early in the X^0 scenes. The three cards she drew were the Magician, “a metal metamorph” with a “great sword and the girl with one foot in two worlds;” The Tower, a “pillar of collapse and rebirth;” and The Devil, “the red god and the lost cardinal of the last religion.” The Tower’s meaning is obvious - there was tower iconography throughout the two books, in all four timelines (on the various islands in X^0, on Krakoa in X^1, Nimrod’s base in X^2, and in the preserve in X^3). The Devil and the Magician are also clearly Cardinal and Rasputin from X^2, but there’s a strong implication that at least Rasputin will be showing up in the current timeline. That’s because…

Singularities

Powers of X #6 confirmed that data that goes into a singularity exists outside of space time. Rasputin died in X^2 when she took Xorn’s helmet off, unleashing the singularity in his brain. Cardinal was also caught in that singularity. Can that transfer them to the current timeline? What else came through? Does that mean that the Xorns, who we clearly see in the background of HoX #1, exist like Molecule Man did in Jonathan Hickman's Avengers books and events, as consciousnesses that span multiple time periods?

Krakoa needs more pylons

The undercurrent of most of House of X is, in a very nerdy and specific sense, one of resource management. There are five Cerebro backups in the world. The Five who perform the resurrections are the only ones capable of doing that job, and so far, Charles is the only one who can drop the backup souls into the bodies. Omega Mutants are flagged as Krakoa’s most important resource. What happens if one of the five is unavailable? How fast can they get Jean or Emma or the Cuckoos trained up on Cerebro? Who guards the backups? The answer to the last question is likely to be answered in X-Force, but the rest are very open questions.

read more: The Many Different Versions of the X-Men Dark Phoenix Saga

Franklin Richards

Franklin Richards is an omega level reality manipulator and the child of Reed Richards and Sue Storm. He’s specifically called out in House of X #1 as important to the mutants. He’s also the one who, according to Hickman’s Secret Wars, the one who recreated the multiverse from nothing. This is DEFINITELY important.

Wolverine and Moira X

Logan and Moira have a close relationship in at least two of her lives, spending centuries together over the course of her 2000-ish years of consciousness. This relationship ended with him killing her, because “this is what [he does],” in both lives we see. Expect this to be explored.

“There can be no precogs on Krakoa”

Mystique’s condition for joining the ruling council of Krakoa is Destiny’s resurrection. Moira is adamant that this cannot happen - she is worried about precogs seeing the future and blowing up their whole plan, or even killing her again to reset the timeline. Charles and Erik basically spend this entire discussion yes-ing Moira to death. I can only speak from personal experience, but when I do this to someone, it means I’m going to do whatever the hell I want, and one of those things that I want is to end the conversation as quickly as I can.

Legion

One of the most uncomfortable things about Moira’s big retcon is how it changes her relationship with Joe MacTaggert, Proteus’ father. He was an abusive bastard and Proteus was the product of marital rape. Powers of X #6 specifically addresses this, in a way, as being part of Moira’s plan - her diary mentions that she was looking for a partner for her to have a child with to create an Omega Mutant. It also says that she was doing this for Charles, and his own extremely problematic child is Legion, David Haller, an Omega Mutant with the power to have an infinite and varied amount of powers. I’m almost certain that one of those powers was precognition, and if it wasn’t, it certainly can be without too much imagination required. He’s not accounted for in these books, but flagged in the Omega Mutant data page in House of X #1.

Moira’s 11th Life

Destiny tells Moira that she sees 10 lives, “maybe 11 if [she makes] the right choice at the end” for Moira. We’re in the middle of life 10.

In some of the promotion for the relaunch, other writers privy to Hickman’s plans mentioned that, to paraphrase, he was building out his ideas modularly, stuffing the book full of big ideas but with a way to close off this relaunch if it didn’t resonate with readers. Moira’s theorized 11th life feels like that reset button, set out on the table and ready to be pushed when it’s needed.

What's Next for Mutants in the Marvel Universe?

Dawn of X is the umbrella covering the first wave of post-HoXPoX X-Men comics, and now that we’re through the introduction, we can see an outline of what those books will look like moving forward.

X-Men is the flagship book, written by Hickman with art from a rotating team that includes Leinil Francis Yu and Powers of X’s RB Silva, at least to start. This is the book that looks to be the main story of the mutants, with a rotating cast of X-Men taking on the new world.

Marauders, by Gerry Duggan and Matteo Lolli, is the story of the Hellfire Trading Company as they smuggle Krakoan drugs around the world. Kitty Pryde, Storm, Bishop, Pyro, Iceman are the main cast manning the ships, while Emma and Shaw do their thing manipulating things behind the scenes. It sounds like they will be, in addition to the main distributors of Krakoan drugs, also smuggling them into countries that have refused to acknowledge Krakoa (like North Korea or Wakanda), and smuggling mutants out of those countries.

X-Force will be written by Ben Percy with art from Joshua Cassara. They are positioned as Krakoa’s CIA, with an intelligence team and a wetworks squad. Sage, Black Tom Cassidy, Beast, and Trinary are the intelligence leads, with Forge running a wetworks shop deep within Krakoa, and Quentin Quire, Marvel Girl, Colossus, Wolverine and Domino as the field team. One of their mandates seems almost certain to be confirming mutant deaths to initiate resurrection protocols.

read more: The X-Men Movies You Never Saw

Excalibur by Tini Howard and Marcus To will deal with mutants and their relationship to magic. Psylocke is taking over as the new Captain Britain, and she’ll be joined by Jubilee, Rogue, Gambit, Rictor, and Apocalypse, and with all of his new backstory floating around, this is one of the most exciting new books on the schedule.

New Mutants will be cowritten by Hickman and Ed Brisson, with art from Rod Reis. This book will feature traditional students - original New Mutants like Karma, Wolfsbane, Cypher, Sunspot and Magik; Generation Xers like Mondo and Chamber; and newer classes like Glob Herman - as one group welcomes new mutants to Krakoa, while the other heads off to Shi’ar space to bring Cannonball home. A “spoiler variant” cover for one of the HoXPoX issues has Sunspot sitting on the throne of Chandilar, the Shi’ar homeworld, and could follow up on ideas introduced in Moira’s ninth life.

Fallen Angels is drawn by Szymon Kudransky and written by Bryan Hill. It features Kwannon, Cable and X-23 out in the world. With the announced additions of Husk and Bling to the cast, this book seems like it will be dealing with mutants with body autonomy issues in their past who are uncomfortable with what the Krakoan mutants are doing.

And finally, announced at NYCC, a Wolverine solo series is coming in February from Percy and legendary Wolverine artist Adam Kubert. Little detail was given about this book, but it’s reasonable to speculate that this might be about Wolverine freelancing instead of following orders from his X-Force compatriots. This would also be a logical place to examine the Wolverine/Moira relationship in greater detail.

Why Does HoXPoX Matter?

Aside from the continuity implications (which are huge), the biggest thing that HoXPoX accomplished was truly astonishing: for the first time in probably twenty years, it really felt like all of the superhero comics reading public was united in their glee from these books.

Superhero comics fans are a large group with a lot of strongly held opinions, but what HoXPoX showed was that we’re united in our desire for X-Men comics to be big and fun and meaningful again. The X-Men line suffered a devastating wound from House of M, and when they were (seemingly) shuffled off to the side once the MCU got big, comics felt a little smaller, a little less meaningful, almost a little meaner.

HoXPoX gave us a big, sweeping, fascinating story and paired it with utterly stunning artwork from pencilers Silva, Pepe Larraz, and colorist Marte Gracia who all did career best work on these books. And they made comics a ton of fun to talk about again. If you don’t believe me, go check out the #XSpoilers hashtag for three days after each issue dropped. I’ve had a pull list for a decade, and have been reading single issues as often as I could grab them for longer. I’ve never had this much fun reading a comic as it came out before. I can’t wait for what’s next.

Read and download the Den of Geek NYCC 2019 Special Edition Magazine right here!

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Feature Jim Dandy

Oct 11, 2019

Marvel

X-Men

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wherethestoryhasimagination · 5 years

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1. What made you write your WIP? 8. When creating the characters for your WIP, what came first to you? 14. Tell us about an upcoming scene in your WIP, that you’re excited about. 27. What is the best writing advice?

1. I started writing it because all the bits and pieces I’ve cobbled together into an idealized Fictional reality of Possibility Finally took shape as something undeniably my own… I know there’s the whole thing about authenticity vs Originality, but Still… Originality can be given an authentic story alongside it.

8. this might seem a bit backwards for ‘character writing’, but when first creating a character, I think of what I want to have happen eventually in the Story, and then try to figure out what kind of Person could have the motivations, the knowledge, the skills, the experiences, and so on, that could lead to them facilitating the eventual outcome of that event.

I especially do this for ‘antagonists’. what possible sequence of experiences, understandings, and desires could possibly lead to someone choosing to do this?

And, by proceeding backwards through how others may react to eachother, I end up with the root of my characters; all spread out, but eventually gathering together to support something incredible.

14. hoooo-boy! an ‘upcoming’ scene in my story that is a work in progress. this one is a real doozy, and I’m real excited for when it eventually comes to be…

3 scientists, gathered together, thinking they’ll make the world a better place… only, they have different definitions of a better place… when the 2 that the 1 gathered discover what is really going on, it is to late. The World is torn asunder. an absolute Ragnarok, as it splits, one half undergoing Blueshift, the other, Redshift; both having fundamentally permanent effects on the Worlds ‘beside’ them.

One Scientist follows with the half that Redshifts… This was not the reaction they had expected… and their Utopian Country atop a monolithic airship is taken beyond their reach. they are left with only the world they had tried to destroy.

the second tries to do all they can from the controls upon said ship, but it is all they can manage to limit the incredible damages to the living things within The World… to prevent everyone from being torn as the World is torn…

and the Third… they don’t make it. they neither Redshift or Blueshift… They bear witness to The World as Light and colour leaves it, and they see how that Light and Colour was the World… Is there anything… ANYTHING, that can be done, to preserve some part of their place here? they will try…

27. best advice… I think it is good to come up with a way that something in your story is supposed to work, and, find a way to make the extraordinary contain a recognizable amount of ordinary. The people in your Story have had this be a part of reality since reality existed. people will have tried and tested all kinds of things, as people do… you have some sort of violent beast that bizarrely has the power to help heal things that enter its shadow? people will try and see what part of the beast holds this power. they will see if they could string up some of the beast’s hairs around a light source, and get the healing effect that way. they’ll try shining different colors of light across it, and see if that changes anything. they’ll shine light upon the place it casts its shadow, and see if it still functions.

every conceivable way that people could try and use whatever they can get from this beast without being required to consistently try and get near it will be tried.

and then it will become ordinary to those who have jobs synthesizing flash-patches that function as magical bandaids… to people who harvest honey from bees that they managed to integrate the healing shadow ‘genes’ into… to the people who don’t even know that their medicine was once only obtainable via proximity to a violent beast…

of course, people don’t discover everything all at once… there are plenty of things that people may not have learned yet… and plenty of ways that other cultures might have learned differently…

But so long as the framework for discovery is there, you’ve left yourself Plenty for you and your characters to find along the way…

that is, If you WANT to write a story where the existence of a healing shadow monster is something you want people to think might have been important at some point in the world… If not, then…

It is perfectly fine for you to not have a reason for every last detail.

it is ok for magic to work because, ‘magic’. you can blanket your magic in one or two relevant restrictions that cover the needs of your story. reasons why your characters have to, or think they have to do something a certain way.

Not all Stories revolve around the World. in fact, last I checked, most Stories are made up of Main Characters.

Whatever you want to focus on, use everything else to enhance that focus.

‘When Rose gave up her physical form, The World had her become Steven because STEVEN needed to be Steven. Not because some preexisting, precise calculations on the nature of Gemkind as a whole said, yea, if this exact thing happened, you’d end up with a whole new person.’

‘When Aang froze himself in ice for years, he emerged just fine because Aang was supposed to be able to suddenly find himself in a whole new world. not because Avatar powers, or air bending, or such determined, yea, this is exactly how this would happen. you’re free to write it like that.’

Most stories have The World revolve around their Characters. Is this selfish? for the very physics of Reality to have been predetermined by some key interactions that some people that just so happen to live in the World would have?

Does it matter if it’s Selfish? No. No it does not. Consistency can be nice, but it is typically far more important for your characters to be Consistent than for the World to be.

Coming to understand something new about a Character has catalyzed far more hypothetical interactions and thoughts and fiction and art than coming to understand something about The World that facilitates Character interaction ever has. Even when something new about the world is given focus, it is usually under the lens of, ‘how could this affect The Characters’.

And when your Characters reach the Point where they have the ability to make some kind of change to the World… Well that’s just where things get interesting.

…

I hope this whole spiel that ended up longer than I thought it’d be is of some help in developing a Focus, and that it can help in getting a fresh perspective on Characters & World building. Thanks for sticking through to the end :3

#sophieakatz #ask #crazy writing stuff #thanks mate!#longpost

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techmaestro · 7 years

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Easily in Touch

So over the last week I’ve been marathoning all of Sense8. I have to say, I love the premise, and the way it was handled in that show, and I look forward to the finale. All of that said, the show inspired this AU which I’m going to say now will not be exactly the same. For one thing, the everyone is born at once thing I just can’t make work in the MCU, but I’ve found ways around that, so HERE WE GO. World details at the bottom.

Tony Stark is the same person he always was here, but because his life took a turn, everything is a little different. When he was 23, the Winter Soldier was free of his leash long enough to try a last ditch escape maneuver that led to him waking his first cluster of kids, which just happened to be Tony’s. He was caught shortly after, before the child cluster could really understand what was going on, and that group had to find their way on their own. Bucky’s cluster consisted of Steve, as well as six of the commandos, most of whom, over the years, were convinced he was dead and his presence when he was able to get off the drugs and cryo were just echoes.

His child cluster is more conflicted given he created it when supposedly ‘dead’. Tony, at the very least, is always alert to these days, and has put no small amount of searching into trying to find their ‘parent’.

Tony’s cluster consists of Rhodey, Pepper, Bruce Banner, Clint Barton, Jane Foster, Stephen Strange, and Kevin Thompson aka Kilgrave (who in this world has his powers come from having his sensate ability overamplified to hell and back and tweaked to affect non-sensate which has a mind control effect. Sensate are immune to his abilities, even ones who aren’t active.)

Steve, upon being found and woken by SHIELD, is the parent of another Cluster Tony has a rather large amount of contact with, as they were activated in the middle of Steve panicking that everyone was dead. Steve, as a result of this, is actually much less unstable, as he has not been alone since this panicked bout of mental flailing.

That cluster consists of Natasha, Sam Wilson, Peter Quill, Hope Van Dyne, T’Challa, Helen Cho, Jemma Simmons, and Leopold Fitz. Suffice to say that Peter Quill was Not Expecting That.

And finally, Tony, after some of the events that made a mess of everything and led to an approximation of the MCU (Though things kind of went off the rails fairly quickly things like alien invasions and alien artifacts and seriously awkward misunderstandings still happen) Tony decided to try his hand at birthing his own group of Sensate. This was around 2014 for him.

This ended up consisting of Wanda (though that was rough at first), Pietro, Peter, Harley, Darcy, and Three others who were born between ‘93, when Darcy born, and 2001, when Harley was born. (By all means, bring me your OCs or XMCU/Comic kids for this)

The actual MCU on the other hand... Obadiah slipped through the cracks because he was a sensate too and Tony ended up leaning on him... and was still tricked by him. So things are the same, but different, and Tony was never dealing with his traumas alone, nor were anyone else from his cluster, which, hey, means Kevin never turned into a supervillain. Silver lining!

Now, the basics of how the AU works. Each cluster is of 8 people who are connected on a quasi-telepathic, empathic, and physical even over long distance sort of situation, who can feel each other’s pain typically even if they don’t want to if it’s bad enough, and if they reach out, can talk to each other without help across the world. It can’t be intercepted, but it can be stopped, and if you’re not conscious no one can reach you. People inside these clusters can let others in their group use their skills, and can understand all languages one in their group can as that person can. The amount of intimacy is a doozy.

In this AU, instead of everyone being born at the same time, the births are still staggered for canon birthdays, but it’s an unbroken chain, wherein the older one isn’t born until the next one is existent in a pregnancy. Only unbroken chains can have their latent genes activated in this AU.

In person eye contact with people outside your 8 makes you able to speak to, and physically poke at, others outside your cluster. You can’t make them stop once you initiate that so that could suck if they’re an asshole.

In this AU the serum only works on people with the genes that let them be sensate. It’s why the Serum was largely a failure, and also extends to Extremis. Killian and Maya tried to overcome a genetic bias they didn’t know what there with Extremis, and it’s why they couldn’t get it to stabilize. It’s also why Tony could fix it.

Birthing a cluster, as it was never explained in the series, for the sake of this AU works as such: The person ‘birthing’ actively reaches out into a spot in their mind that hums with ‘potential’ and tugs on it. This, in turn, sends out a signal to 8 people not of their choosing, all over the world, and immediately forges a brand new connection between them and those people, while imprinting some of who they are onto those people, thus it being a parent style bond, before those people fight through the process of acclimating to each other. The parent is supposed to help smooth this out and make the whole thing less scary.

Ideally, everyone gets along, but it doesn’t always work that way, and the bond in no way changes the personalities of anyone involved. If someone is a HYDRA asshole, then their cluster has to figure out how to deal with that.

Chemicals can be used to block connections as well as unconsciousness, and in this AU rather than being a separate species, the sensate are more of a widespread mutation, so to speak, and should someone bring mutants into the mix, those mutants could also be this, as a cross of genetics. Either way, Sensate folks are kind of a secret handled with care while political ones have tried to work out how to make it so that they could safely come out of hiding.

#aus #v: in touch #a: in touch

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shooter-nobunagun · 4 years

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Quarantine UST 11

//HAH what made me think I could write a soft chapter AND fit smut in at the same time? Spoiler alert I can’t.

Hope this fic gave you guys some entertainment during these times. I know I sure as hell enjoyed writing it.

Instead of pulling away and apologizing profusely as she usually did however, the sniper’s hands continued to linger; her soft fingertips slowly started stroking his stomach, and Adam felt his pulse increase as the sniper continued tracing his muscles.

“S, Sio...!”

“...Sorry; is this bothering you?”

Adam gulped; she was doing it again—this whole pseudo-personality switch that, he suspected, tended to happen not just on the battlefield but also when she was in the mood. Her tone had changed slightly as well; low and slightly sultry, but he could still hear her sincerity.

“No...I’m sorry, I shouldn’t have suggested we sleep in the same bed...” He was afraid this would happen—that, no matter how hard he tried, his body would start reacting when they were in such close vicinity. Of course, that was before he realized she’d be so bold as to try and masturbate in secret next to him, but that was another story.

“Don’t be; it’s...natural, after all...”

Despite being turned on, Sio still blushed and nuzzled against his back; even with her secret orgasm earlier, she knew her body wasn’t satisfied with just a little self-pleasure. And it seemed, Adam felt the same way; except he had the dignity to actually hold it and not do anything. ‘Unlike me...’

“Adam...w, would you...c-can I...touch you?”

He couldn’t see the girl, but just from the way she was squirming against his back, clinging to him even tighter than before, told him it took a lot of courage to voice her wants. Can I touch you... It was so earnest and innocent, her repeating those words he’d asked her that first time. Despite everything, he smiled into his pillow, cheeks flushing pleasantly. The way their roles always seemed to be reversing pleased him in the most ironic sense.

“...Yeh; go ahead, Sio.”

The sniper didn’t say anything—no doubt she was too embarrassed—but her hands definitely started moving; light, curious touches at first that were barely tracing across his skin, causing Adam to almost laugh from the sensations. He could feel her breath warming his back through his shirt, as she grew bolder and a finger traced the ridge right along his pelvis; Adam let out a slow breath as it stopped at the edge of his boxers, before it snuck underneath.

“Nngg...!” The sensation was an odd mix of ticklish and arousal; the rest of her hand dove in and started groping around, until it brushed through his wiry curls and gently gripped his half-erect length, stroking it until he fully stiffened. “Guh—S-Sio...”

“...It’s so hard...and hot...I can feel it twitching...” Sio couldn’t believe she worked up the courage to start giving her boyfriend a handjob in the middle of the night, but here they were and here she was—feeling the soft-hard member in her hand, using only her touch to figure out what pleased him and what was good. Her other hand was still generously smoothing up and down his glorious set of abs, trying to memorize the feeling of his solid muscles underneath her fingertips. The more she touched him, the more he made these odd noises; grunts and sighs, a half-muffled moan every once in a while. The hand on his torso could feel the precisely how his muscles tensed and twitched with each breath, and how hot his skin felt. Swallowing nervously, she tried to ignore her own arousal, which was starting to become rather persistent.

“Haah, hah...S, Sio...I, I’m...” Adam tried not to move too much, for fear of startling her. It felt so good. Her small, delicate hands were quite dexterous and for someone who had no experience, she certainly was a quick learner. Already she figured out, just from touch, that using her thumb to spread the pre-cum across the tip was greatly pleasurable—though he might’ve tipped her off from the way he jerked his hips, a low moan escaping his mouth as she did so. Her other hand was still exploring the rest of his body, even brushing against his stiff nipples and gently circling them, as he'd done to her. A tight, heavy ache was building up in his groin—he muffled another groan as the sniper tightened her grip and vigorously stroked him, using his foreskin to slide up and down the entire length of his shaft. “A-Aah! Gah—s-slow down...!”

“S-Sorry!” Maybe she shouldn’t be so hasty; though, if she didn’t know any better, Adam was probably on the edge; his breathing had gotten considerably heavier in the past couple of minutes, and she could feel his heart pounding against her fingertips. Her own body was heating up and getting sweaty, especially as Sio swore she could smell some sort of musky scent coming from his body. Her finger brushed gently against a particular vein on his penis, Sio marveling at how she could literally feel his pulse just by gripping it. “I, I’ll be more gentle...sorry...” Taking care to not just go as fast as she could, the sniper resumed her strokes, only this time she made sure they were slow and deep; covering the tip, then all the way down in one smooth motion, helped along by the generous amount of pre-cum that was leaking all over her hand.

‘Shit; I don’t think I can hold it any longer...’ His boxers were already wet, Sio’s actions making a faint ‘schlick’ sound as she stroked him. The thought of letting her get him off again was extremely tempting, but a part of him wanted something a little...more. Not full-on penetration, but just...something else.

“S-Sio...Sio! S, Stop...” The sniper froze, thinking she’d done something wrong. “Don’t worry, you’re fine...it’s not anything you’re doing, but it’s just...” Heaving, he gently removed her wet hand from inside his boxers, groaning as the warmth disappeared. “I’m quite close...but before that, I’d like to...return the favor...” Adam rolled over to the other side, now face-to-face with a very bashful sniper. “Is that...alright?”

“...Oh. Uh, uh...A-Adam...” Her face bloomed scarlet and she had to turn way, unsure of what to say. “Th, that’s...w-well, uhh...I...” Just as she was thinking of how to satisfy her own needs after this, Adam had paused his own pleasure and offered to make her feel good, first. “You’re such a gentleman...”

Adam snorted into the pillow at that comment. “Hah, that hardly makes me a gentleman, love...especially since it’s more for a selfish reason of my own...”

“Huh?” She wasn’t sure what to make of it, but then Adam was spooning her into his grasp, Sio squeaking as she felt something hard brush against her thighs. ‘It’s his...thing...!’ Just thinking about it made her blush, even though she had been touching it minutes earlier. The sniper was now encased snugly in his arms, Sio relishing the warmth and security of being embraced so fully like this.

“Mmm...you’re so warm...it’s kinda like having my own heater,” she joked, Adam smirking against her hairline at that comment.

“I hope I’m more than just that, love.” His hand dipped inside her panties, Sio mewling as he slipped through her already-wet folds. “Someone’s been having some naughty thoughts, ‘ey?” A single digit rubbed her throbbing clit and the sniper moaned, writhing even though he was barely doing anything.

“Haah—A, Adam...nng!” It was even better than she’d imagined; his calloused fingertips, now fondling her most sensitive part with a delicate strength... “Y-Your hand...feels so good, touching me directly...” His other arm was holding her steady against his broad chest, Sio enjoying the feel of being stabilized against him as her body twitched with pleasure. “Uhn—y-yes, like that...”

Holy hell, was this one of the most erotic things he’d ever done in his life so far. By this point most people knew Sio also experienced personality changes due to her e-gene, but Adam never imagined the sniper would have quite the hidden libido to boot. He never would’ve guessed the shy, stuttering Sio Ogura would be so vocal during sex, both in voicing her needs as well as making noises in general. Her folds were slick and hot, tempting him to just shove a digit inside—but he resisted the urge to do so, instead settling for toying her her swollen clit, which she seemed to enjoy the most.

“Ah...ah...feels really good...y-you can move faster...” Whimpering, Sio squirmed around in Adam’s arms, trying not to flail all over the place. Somehow he knew just how much pressure and friction to apply to her little pearl; or maybe he was just that good? She could feel her juices starting to drip down her thighs, her breath coming in faster pants as she felt herself building towards a fantastic orgasm. ‘Oh boy...this one’s gonna be a doozy, I can feel it...’ It was going to be even better than the first time, when he’d merely rubbed through her underwear; but this—touching her directly—made her even hotter than before. Her nipples ached to be touched, Sio making a half-hearted attempt to at least give them a light squeeze but most of her attentions were focused solely between her legs.

“Hmmm...someone’s enjoying this.” He breathed against the shell of her ear just as he pinched her clit and she cried out, arching her back against him. “You’re so wet, it’s amazing, really...” If he wasn’t hard before, then he certainly was now; the sniper was all but a writhing mess in his arms, twitching and mewling as he brought her ever closer to the climax. Grunting, he rubbed himself slightly against the slight curve of her bum, right in the heated crevice between her thighs and she jerked in surprise.

“A-Adam??” His thing—penis, she corrected herself—was poking her again, and she flushed nervously. “Y, You’re not...actually going to, put it in, are you...?” So they were moving quite fast, but Sio wasn’t sure if she was ready for the full on, ‘penis in vagina’ kind of sex. Nevermind the fact that she did not have a condom and had no idea if Adam had any either.

“...No, not if you’re uncomfortable with it. Sorry, didn’t mean to scare you.” Adam wasn’t even sure if he was ready for another ‘milestone’ so soon, but that didn’t mean there weren’t other methods. “Actually, I have an idea I want to try...that will feel similar to...y’know, being inside you, but not actually doing...that.”

“E, Eh? How would that work?”

“...Well, if you’ll trust me, I can show you...”

Sio paused, then nodded. “O-Okay...just, as long as you won’t put it inside me... I, I don’t think I’m ready for that yet...” A warm hand cupped her cheek and gently turned her, until soft emeralds gazed at her with nothing short of affection.

“Sio, I won’t do anything you don’t want to. So don’t worry, and just let me know what you’re comfortable with, yeh?”

“Uh-huh...” His gaze was so intense it was almost unbearable, but Sio wanted to show she trusted him. “I...trust you, Adam.”

He planted a soft kiss on her lips, and she sighed into the warmth. “Very well then; I’ll lead, and we’ll see if this works as well as I’m thinking of...”

The sniper once again found herself spooned tightly against him, only this time there was something very hot and very stiff digging into her butt. She still couldn’t figure out what Adam had in mind, but if he had some sort of plan...

“H-Hiiyaa!” She gave a startled cry as the hot length started moving, but instead of poking her repeatedly in the behind, he was sliding it between her legs. “Wha, what are...”

“Just hold still, if you wouldn’t mind...” Adam grunted from behind her, trying to restrain himself from going all out. “If I...do it like this, then it’ll feel...good...” He thrust his hips a few times, trying to figure out the position but slowly he was gaining momentum. The hot, silken skin between her thighs was pillowy-soft against his stiff member; Adam breathed harshly against her neck as his thrusts became smoother, the pleasure now building back up as his cock slid easily between her legs, thanks to the generous amount of pre-cum that was leaking out.

‘I see; so this is what he meant by feeling similar...’ Sio blushed as she lay there, letting Adam hump between her thighs. To be honest it felt kind of awkward, but it wasn’t unpleasant; as long as Adam was enjoying it, that was all that really mattered. Besides, it was nice to be held tightly like this, feeling him tremble and pant against her body as he worked himself into a fervor.

“Nng...ugh, S-Sio...! Sio I’m, I’m going to...!” Suddenly his grip tightened, the sniper feeling herself squeezed between his arms as Adam groaned deeply, before something hot spilled all down her legs as he thrust unevenly. “Guh—shit, I’m coming...” Every muscle seemed to be drawn tight as a bowstring, and then he went limp like a rag doll; Sio squeaked as his body weight caved in on her, before he muttered an apology and pushed himself off to the side, still panting heavily.

“Oh god...holy shit, that was fucking amazing...” Sighing with satisfaction, Adam was all but ready to just collapse into the sheets and pass out; however, in the back of his mind he remembered that he didn’t actually finish Sio off yet.

“Oh shit, I was s’pposed to get you off first...damn it...”

Sio giggled at that comment. “Adam, it’s okay you know. To be honest, I almost forgot about that...” There was a sigh against her neck and she blushed from the heat, before his large hands wound around her slender waist. “Mmn...” His hands were a heavy, warm weight against the curve of her hip, rubbing her skin soothingly. It was quite relaxing actually, Sio starting to feel drowsy in the comforting heat.

“True, but promises are promises,” Adam whispered hotly in her ear while sliding a finger into her damp panties, Sio whimpering as he resumed his ministrations. “Good, you’re still wet down here.” He found her sensitive clit again with little difficulty, though the slippery fluids meant his finger kept sliding off. Frowning to himself, Adam decided to compensate by inserting another digit. It was easier to reach more skin with both of them, and Sio certainly seemed to be responding to the added stimulation. With each stroke of his fingers her whimpers grew a little louder, the sniper whining and burying her face in the pillow.

“M-Mnn...nnng, uhnn...” He was fingering her with a steady rhythm, Sio thrusting her hips slightly as the tension grew. “A-Ahh...it’s, good...” She relished the attention on her clit, even as his other hand cupped her breast and gently fondled them. “O-Oh...ah, mmmnn...!” The heat simmered low and steady in her belly as she put her smaller hand on top of his, guiding him to her most sensitive spot inside her underwear. “H-Here, feels really good...! Hnng!” She gasped for breath as Adam pushed down hard, her stomach clenching up tight. “Haah, ah...nnng—ah, hah, haah—!”

He could tell the sniper was getting close, even before she started twitching all over the place. His fingers were soaked; slippery and sticky as he continued to tease her just the way she liked it: firm, tight circles around that stiff little nub, or even pinching and rubbing it directly. By now Sio herself was little more than a writhing mess, not really forming any coherent words as she tried her best to keep her voice down. Her perky nipples were stiff when he rubbed them, as he slowly kissed her pale, slender neck.

“Haaah—A, Adam, it’s c, coming...” Sio moaned as Adam started tracing his lips against the curve of her shoulder, right as his fingers started moving faster. “M, More...f-faster, please...” Normally the sniper would never be so open about what pleased her, but she discovered when her lust was high, all those inhibitions seemed to fade away. Besides, it was kind of a turn-on to tell Adam what she wanted him to do. Especially when he obliged without another word.

“Aaah! Y-Yes, yes...! I’m so close...oh god, please...!” Her breathing was getting harsher and her body seemed to be under someone else’s control; Sio could feel her inner walls starting to spasm, her muscles quivering as her orgasm was building steadily to the highest peak as Adam continued at this seemingly-unstoppable pace. Her clit felt like it was on fire as he fingered her with an almost machine-like precision; Sio’s head was swimming and she fought to breath as she felt the climax starting to break. “Nnng...! Ah!” Right as she spilled over she pushed one of his digits in, thrusting it into her tight insides and letting her muscles squeeze and convulse around it. Wave after wave of mind-numbing pleasured pulsed from deep inside her, Sio nearly sobbing with pleasure as she cried into her now-damp pillow. “Hah, hah...oh man...” Faint tingles of pleasure still ran through her body if she even moved just slightly, Sio mewling as she enjoyed the smaller aftershocks; gently teasing her now-hypersensitive clit, feeling herself clench down on Adam’s finger that was still buried inside her.

“Oooohh...” Everything seemed hazy and out-of-focus; the sniper was one step away from simply closing her eyes and going to sleep, her body completely relaxed in his warm embrace. Adam slowly withdrew the finger, the sniper blushing as she felt a last trickle of fluid drip out along with it. “Oh wow...wow, Adam...” She was still catching her breath as he slowly spooned her into his chest, Sio automatically burying her face against the crook of his neck.

“...I hope that was everything you wanted, Sio.” Adam murmured against her hair. Now that they were both quite satisfied, he wanted nothing more than to hold her tight and go to sleep. When she’d pushed his finger inside at the very end, he’d been too shocked to do anything other than go along with it--but, after seeing and hearing the sniper writhe in completely ecstasy, was glad she trusted him. So it probably wasn’t exactly what most people would think of for their ‘first time’, but to him it didn’t matter. They trusted each other to bare their most intimate parts to the other...and now, with the girl yawning and snuggling deeper, Adam didn’t want to change anything. Warm affection rushed through his body, his chest rumbling with contentment as he spooned her petite body against his. She was so cute and small against him; soft honey-brown hair fell like silk against his neck, her breath tickling his skin as he drummed his fingers soothingly down her back.

“Mmm hmm...th-that was...amazing, Adam...I’m glad we got this chance, before we have to go back,” Sio whispered shyly, her fingers absently stroking his collarbone. “Thinking back...I never would’ve believed all this would happen in just a month...and in the middle of a quarantine, to boot.”

“Heh; life is odd like that, isn’t it?” The girl nodded, before surprising him with a quick peck on the lips. “Oh, my my...someone’s still frisky.”

“Hah, yeah right...I’m beat...” Another yawn tore from her mouth, Sio stretching one final time before permanently settling into his arms. “Man, doing that kind of stuff really does make you tired...I guess all the connotations about ‘doing it in bed’ make sense now...”

Adam couldn’t help but snort at her whimsical comments. “You’re more than welcome to test that theory with me later on...but you’re right; sleep does sound quite good right about now...” A tired note of agreement from the girl, who sounded like she was already half-asleep. His eyes crinkled just slightly as he watched her for a while longer, studying her slumbering visage. Her eyelashes fluttered slightly with each inhale and exhale, her pink lips pursed slightly as she muttered something unintelligible.

It really was a shame it would all be over tomorrow...but, well, maybe not Adam thought tiredly as his own eyes started closing. They would no longer be in San Francisco, yes, but their relationship would continue on with them. As for how they were going to handle this back once they returned to the A. Logan and got back to the thick of things...well, that was for future Adam and Sio to figure out. For now, the present Adam wanted to just close his eyes, wrap himself around a petite sniper, and hopefully dream about pleasant things. ---- “...Huh, would you look at that, I actually woke up before the alarm for once.”

“Actually, that’s because I turned it off first.”

“...Oh.” Adam smirked as the sniper rubbed the sleep from her eyes. “Nevermind, then...what time is it anyway?”

“Eh, about time to get up quite honestly, but I suppose we could stay a couple more minutes like this...” Truthfully, Adam wanted to enjoy every last second of time they had left together. Who knew when they’d next be able to spend a lazy morning together, making small talk across the pillows and just enjoying each others’ company?

The sun shone weakly through a veil of summer fog, making the bed seem like a much cozier option than getting up. Sio’s fingers were tangling themselves through his silvery strands, and Adam found himself very much enjoying her pampering.

“Your hair is so soft...and it’s definitely way longer than when we first came here. Sure you don’t want to leave it out and tie it up like a samurai or something? Oh, or like one of those mythical swordsman in those wuxia films--eek!” Sio squealed as Adam tickled her ribs, the grimace on his face clearly suggesting just what his thoughts were on such a hairstyle. “Ah ha ha hahah--A-Adam...!”

“Samurai? Wuxia? No thanks, think I’ll pass--oy, what do you think yer doin’?!” He barely rolled over in time as the girl somehow squirmed past his arms with surprising speed, and now the tables were turned, it seemed. Her lips curved into that signature smirk as she straddled his waist, fingers just on the verge of lifting his t-shirt up, and Adam gulped.

“...Don’t you dare get any ideas, Si--o! Shit--!” He tried not to laugh as her fingers now mercilessly teased his sides, Adam attempting to buck her off but he could never concentrate hard enough. “S-Stop! You little sneak!”

“Hey now, it’s not my fault you let your guard down!” Sio was enjoying this immensely, watching Adam’s face flush pink as he laughed and tried to swat her hands away. “The big, scary Ripper being reduced to tears by a Japanese schoolgirl...who’d have thought.” With the way the two were caught up in wrestling each other on the bed, it was no surprise that neither of them heard the knocks.

“Hey Adam, are you up--oh my--”

“--God fucking dammit, what is it with you people and not knocking?!” Sio practically lept off Adam with a squawk, who was attempting to pull a blanket over her bared legs. “What the fuck Mirza!”

The two holders on the bed stared with growing horror at the sudden intruder, who had an extremely amused expression on his face.

“Hey now, I did knock, but it’s not my fault if you two didn’t hear me.” Adam shot the other holder a death glare but it was wholly ignored. “I just wanted to let you two know that our final breakfast is here. Oh, and Command sent us a message--our ride will be here in about 15 minutes. That’s all. I’ll just, uh, let you two carry on...and I guess I owe someone a quid.”

That last part didn’t make sense to them, but Mahesh’s bet was the last thing on their minds. Adam was torn between running out and tackling the Indian and swearing him to secrecy, or just staying put and praying their teammate had enough sense to not blab about it. “Fucking hell...! Alright that’s it, I think even with everything that’s happened here, one thing I won’t miss is people randomly barging in whenever they want.”

“Well, so much for keeping it a secret...” Sio sighed as she put on her uniform, tucking the last of her worn clothes into her bag. “Though, on the other hand I guess this saves us the trouble of figuring out how to announce it...”

“Hmph. I suppose...still, that wanker,” Adam grumbled as they packed up their final belongings. “I swear he does this on purpose...I don’t know how, but still...”

Luckily, neither Jess nor Mahesh said anything more as they all gathered downstairs at the table, enjoying their last meal in quarantine. As Sio sipped her latte (yes even she, the baby of the group, had finally grown to like the bitter liquid), she made sure to savor every last detail. The large dining table where they all sat, the Victorian architecture and its old-fashioned wallpaper yet was stylishly updated with the latest gadgets and tech. Sio noticed Mahesh sliding a wad of bills over to Jess who pocketed them with a slight smirk, much to her confusion. As she finished the last of her coffee, she made sure to send some final messages to Asao while she still could--once they got underway, her cell signal could get cut off at any moment.

[Sio]: Well, it’s time to get back to DOGOO and saving the world and all that. You know, even with all the virus business and stuff...I’m gonna miss this. I mean, yeah I’m gonna miss being able to spend time with Adam like this, but it’s not like we won’t be together when we get back (hah). I guess it’s more like being able to put being an e-gene holder on pause, and getting to know everyone like this...

The sniper looked up at from her phone as the rest of the members cleared up the remaining trash, Adam barking at the other two that it would be incredibly rude and reflect poorly on DOGOO if they left the place a mess.

“I won’t have the Second Platoon earn a reputation for bein’ slobs.”

“Yes, oh dear leader.”

“Shut up, Mirza, before I really knock some sense into you...”

Sio smiled to herself as they waited in the foyer. She hoped there would at least be some more time to talk to re-adjust before they went back to fighting. Probably there would be some new procedures in place once they got back, like maintaining distance and wearing masks and all that, but knowing DOGOO, they probably already figured it out. Hopefully she and Adam could figure out how to hang out with each other...especially at night. She surreptitiously looked around, hoping nobody noticed her bright red cheeks.

She was just about to try and check her messages one last time when a car honked, and then she knew it was time.

“Well, that’s our signal; time to go back to saving the world. Need a hand with your stuff, squirt?” Sio looked up to Adam offering his hand.

“Oh, uh...you know what, I got it this time. But, thanks for offering...” Instead of handing him her duffel, she took his hand into hers instead; Adam automatically laced their fingers together. “Besides, I think I like it better like...this...”

He granted her a rare smile. “Same, Ogura. Same.”

#documentation #quarantine ust #//and that's it #//we are one and done #//holy shit i finished a fic in less than one year what is this #//...now back to the other ones i have yet to finish #//sobs

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kristablogs · 4 years

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There’s a dangerous virus brewing in pigs—but there’s no need to panic yet

Viruses grow and evolve in many animal hosts, and pigs allow them to become especially dangerous. (Unsplash/)

We first learned about COVID-19 when headlines proclaimed that the virus was already spreading like wildfire amongst humans. But what if there was a way to catch these viruses before they become efficiently transmissible between humans?

In a study published last month in Proceedings of the National Academy of Sciences, scientists presented a way to do just that. By closely surveying the movements of a new strain of swine influenza in pig farms, they hoped to gain insight into the ways we can catch a virus before it wreaks havoc on the human population.

Along the way, the scientists uncovered a new swine influenza virus called G4. It’s a blend of three existing viruses—avian influenza, the swine influenza responsible for the 2009 pandemic, and another North American swine influenza that’s a hodgepodge of genes from avian, pig, and human viruses. The blending of these viral genes, called genetic reassortment, is more common than you might think. Any virus whose genetic material is made of RNA, such as influenza and the novel coronavirus, has evolved this powerful evolutionary tool. When different influenza viruses infect a single cell, they blend segments of their genes together and form a new virus—one that often has more capacity to make the jump from animal host to human.

And that’s exactly what’s happening in the pigs scientists worked with for this new study. They huddle in close proximity with one another in pens, but pigs also constantly come in contact with birds and humans. “There are wild birds that have access to the pigs,” says Angela Rasmussen, a virologist at Columbia University. “Those pigs are then in contact with humans working in the farm.” Exposed to both human and bird viruses, the pigs become “mixing vessels” for these viruses, resulting in the formation of a patchwork virus like G4.

So should we be worried about this virus becoming rapidly transmissible among humans? The study itself isn’t a proclamation that another pandemic is on its way, says Martha Nelson, an evolutionary biologist at the National Institute of Health. “It’s a virus that has all the hallmarks of a virus capable of jumping from pigs to humans,” says Nelson, but there’s no evidence of human-to-human transmission right now. “I think the key is that it’s something to pay attention to.” While the G4 virus has infected several swine workers, it hasn’t yet been transmitted from one human to another. And that’s an essential distinction. “It’s hard to say [if] we should be worried about this particular strain,” says Rasmussen.

Nailing down this novel virus’s trajectory wasn’t easy. From 2011 to 2018, across ten provinces in China, scientists analyzed 30,000 nasal swabs collected from pigs. They ended up isolating 179 different swine influenza viruses—and found that in the years after 2016, the majority of these viruses were G4. It had quickly become the dominant version in all ten provinces.

Though it’s widespread in these animals, if it ever did jump to humans, it would be a doozy. The recombined virus’ segment of the avian influenza genome poses an enormous risk, as humans have very little known immunity to it. Additionally, the inclusion of that same swine influenza strain from the 2009 pandemic, which spawned nearly half a million confirmed human cases, makes G4 even more adaptable to infecting human cells.

Long story short, we shouldn’t sit back and relax just yet. To prevent yet another virus from spreading under our noses, these scientists call for real-time surveillance of these pathogens. By monitoring our livestock populations, particularly pigs, we can reduce the risk of another virus making that dreaded jump from animal to human, and eventually human to human.

A game of chance

Monitoring Earth’s pig population, however, is no easy task. For example, China is home to 310.4 million pigs—nearly half the world’s swine population. With influenza’s power to reassort within pigs, the possibilities are endless. “You can have multiple genomes swapping entire parts of their genome to make new chimeric viruses,” says Nelson.

Any country raising enormous populations of pigs, such as the US and Brazil, increases the risk of these cesspools of viral genetic reassortment—endangering swine workers, who then become carriers of the virus to the rest of the human population.

Pigs are one of the most common carriers of human-adaptable viruses, along with birds and bats, not just because of their vast populations—but because of their biology. The cells lining their respiratory tracts are extremely similar humans'. Pigs have receptors for both avian and swine/human influenza viruses on cell surfaces in their upper respiratory tracts, called sialic acid receptors. “If a bird virus gets into a pig, and it adapts to the pig’s sialic acid receptors, that means it may be more efficient at infecting a human,” says Nelson.

Plus, the virus is very vulnerable to mutations, which give rise to the random changes that might make a virus adaptable to humans. The influenza genome is made of RNA, single-stranded genetic code that’s extra prone to making mistakes. While DNA comes with enzymes that act as spell checkers during gene replication, RNA completely lacks these tools—thus giving rise to many more mistakes, or mutations, in the genetic code. “If you make a typo, that typo doesn’t get corrected,” says Rasmussen.

As mistake after mistake trips up the influenza virus’ genetic code, the higher the chance that one unique combination gives rise to a virus that can jump to humans—that is, a virus that has the ability to bind to human-specific cell receptors, then persist and spread within the human body, and transmit from human to human. It’s a game of chance—one that makes it extremely difficult for scientists to predict when the next pandemic is on its way. “It’s like shuffling a deck of cards,” says Rasmussen. “You’ll have different genomes in a virus and it will have unpredictable effects in terms of transmissibility.” That’s what happened with COVID-19—the jump from bats to humans (the mechanisms behind which are still largely unknown) went undetected, only attracting widespread scrutiny once the virus became highly transmissible between people.

How can we prevent the next pandemic?

The line between a transmissible, pandemic-ready virus and a benign one that exists only within the pig population is eerily thin.

“It’s a game of probability,” says Nelson. “As time goes on, it’s more likely that a variant will figure out how to make this jump. There’s nothing that says it couldn’t happen tomorrow or in twenty years. As time progresses and as we have more genetic diversity growing in pigs, and as pig populations grow, it becomes more risky.”

This makes intricate surveillance systems crucial—specifically, that would involve regular viral testing of pig and poultry populations, as well as the humans who work closely with these animals. That means programs that actively monitor viruses, and limiting exposure to poultry and swine are essential for nipping the next pandemic in its bud, says Chad Petit, an assistant professor of virology at the University of Alabama at Birmingham. “Awareness and preparation is really what’s key to being able to see a potential pandemic before it comes.”

Rasmussen references the work done by scientists in the aforementioned study, claiming that the project they conducted—visiting pig farms, conducting lab analyses of thousands of pig nasal swabs—can be an example for other countries to follow. “You need to do experiments in the lab to show that these viruses have the potential to spread to human cells, we need to go out and potentially sample people who might have been in contact with the animals. It’s a lot more than doing surveillance.”

“There will be more pandemics,” says Rasmussen. To stop one in its tracks before it even begins could save many lives.

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scootoaster · 4 years

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There’s a dangerous virus brewing in pigs—but there’s no need to panic yet

Viruses grow and evolve in many animal hosts, and pigs allow them to become especially dangerous. (Unsplash/)

A game of chance

How can we prevent the next pandemic?

The line between a transmissible, pandemic-ready virus and a benign one that exists only within the pig population is eerily thin.

“There will be more pandemics,” says Rasmussen. To stop one in its tracks before it even begins could save many lives.

0 notes

wendyimmiller · 5 years

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The Okra Illuminati

“Artemis Rat Okra” aka V.E.G. Ham.

Let me introduce Van Eugene Gatewood Ham, a native of Greenville, Mississippi, with a soft spot for okra.

Gene Ham visits Central Kentucky every Thanksgiving to catch up with childhood friends who live nearby. He came to our home last year for a Friday evening party. A small pile of crispy okra seedpods, the color of dried parchment, sitting on the kitchen counter, caught his eye. He recognized the seedpods immediately. I was impressed. Okra seedpods would stump most folks on an ID quiz, even savvy horticulturists.

I asked Gene if he was an okra fan. He held the seed pods tenderly, glanced knowingly, turned serious, and unwound—slowly—“Oh, yeah.”

Gene figured correctly. I love okra, also.

He looked around.

He did not want to be overheard. “Do you have time for a story?” Gene’s a storyteller. He began sketching details about the origins and history of the Knights and United Daughters of Okra.

Where, exactly, any of this story took place, Gene wouldn’t tell me. There were references to Southwest Virginia and the Cumberland Plateau, but who knows?

The outline was a doozy, but pieces were missing. His story was not a tell-all. Gene did not want to betray his brethren and sisterhood.

I’d had second helpings of skillet-fried okra on the brain for months, wondering about Gene’s story, and then I read the wonderful Walks to the Paradise Garden—A Lowdown Southern Odyssey.

Gene’s name was in the book’s acknowledgements—in code!

‘”Artemis Rat Okra” aka V.E.G. Ham.”’

Turns out, Gene was a player in this southern odyssey by virtue of okra, though, no doubt also a participant in conversations about all manner of things, besides okra, among friends and colleagues who were also acknowledged.

Jonathan Williams, the late poet and “provocateur,” laid out the project’s intent in the book’s introduction. “For one thing, most of the people (folk artists) in this book are directly involved with making paradise for themselves in the front yard, the back garden, the parlor, the sun porch, the basement. Making things has been a way to salvage a little dignity from poor and difficult lives.” Later on, Williams wrote clearly and proudly: These are “visionaries, eccentrics and treasures.”

“Walks in the Paradise Garden, “Williams explains, “is not Kunsthistorichwerk, or criticism, or sociology or anthropology, or camp for the coffee table. It is a collection of outlandish findings by three southern persons, all white and all male. This is something we don’t fret about and hope that you won’t either. May we please both okra-eaters and non-okra-eaters alike!”

Jonathan Williams and photographers Roger Manley and Guy Mendes drove around the south in the 1970s until the early 1990s, attempting to meet and document outsider artists.

The next meal was never far away. There were breakfasts of beaten biscuits and country ham, pecan waffles and grits. (Grits lost ground briefly to polenta in uppity southern restaurants in the 1990s but survived the cultural skirmish.) There were odyssey dinners (lunchtime) and suppers (dinners) with barbecue, catfish, turnip greens, fried chicken, sweet potato casserole and, of course, okra.

The Lowdown Southern Odyssey project lay dormant for years but was not forgotten. Walks in the Paradise Garden was published by Institute 193, this spring, at long last, accompanied by an exhibit at Atlanta’s High Museum.

Sister Gertrude Morgan in her Everlasting Gospel Revelation Mission, New Orleans, LA, 1974. Guy Mendes photo. Courtesy of the artist and Institute 193.

Back to Gene Ham.

I wrote Gene (he doesn’t use a computer) a few months ago, after I read the wonderful Walks to the Paradise Garden. I hoped Gene would school me on okra and Okra Memorial University. Gene, by the way, is a retired English teacher who lives now in Fayetteville, Tennessee.

A few weeks went by before a finely written letter arrived. “As is typical of other fraternal and sororal orders there are mysteries which can not be revealed…like the nearly lost origins of Free Masons in the distant past.”

One point was clear: “Then, as now, members were bound together by a love of the divine vegetable. Several of the generals were exiles from the deeper south who were greatly dismayed at the absence of okra in local produce markets.”

Gene Ham allowed that Okra Memorial University, and its pop-up satellite affiliates—wherever, or if they were ever—have on occasion, granted degrees that are “chiefly honorary.” Doctorates have been conferred on Wendell Berry, Allen Ginsburg and Ken Kesey in “simple but significant ceremonies over the years.”

https://www.gardenrant.com/wp-content/uploads/2019/08/Gene-Ham-Roy-Blount-Jr.-Okra-080719.mp3

Listen to Gene Ham recite Roy Blount Jr.’s Song to Okra.

This is the scantest little I know of the mythic Okra Illuminati.

Good luck if you try to Google The Knights and United Daughters of Okra.

I was in my early 20s before I first tasted okra. I was smitten, and I’ll admit: I have an inherited taste for greasy food. I can’t, however, explain why, or how, delectably, slimy okra had been hidden from me for so many years.

(For anyone willing to explore okra’s history, culture, sociology, recipes (not all greasy), seed strains and, yes, tips on “mucilaginous” hair conditioner, I recommend, also: The Whole Okra—A Seed to Stem Celebration.)

Gene Ham likes okra the simple way: boiled with a little bit of butter and black pepper. Or Creole style: fried with okra cut crosswise along with tomatoes, green pepper, onions, and garlic,laid on a bed of rice.

Not everyone can be blessed with Gene Ham’s good taste.

Please, no more okraphobic slurs of cotton’s cousin.

Set your taste buds free.

The Okra Illuminati originally appeared on GardenRant on August 14, 2019.

from Gardening https://www.gardenrant.com/2019/08/the-okra-illuminati.html via http://www.rssmix.com/

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turfandlawncare · 5 years

Text

The Okra Illuminati

“Artemis Rat Okra” aka V.E.G. Ham.

Let me introduce Van Eugene Gatewood Ham, a native of Greenville, Mississippi, with a soft spot for okra.

I asked Gene if he was an okra fan. He held the seed pods tenderly, glanced knowingly, turned serious, and unwound—slowly—“Oh, yeah.”

Gene figured correctly. I love okra, also.

He looked around.

He did not want to be overheard. “Do you have time for a story?” Gene’s a storyteller. He began sketching details about the origins and history of the Knights and United Daughters of Okra.

Where, exactly, any of this story took place, Gene wouldn’t tell me. There were references to Southwest Virginia and the Cumberland Plateau, but who knows?

The outline was a doozy, but pieces were missing. His story was not a tell-all. Gene did not want to betray his brethren and sisterhood.

I’d had second helpings of skillet-fried okra on the brain for months, wondering about Gene’s story, and then I read the wonderful Walks to the Paradise Garden—A Lowdown Southern Odyssey.

Gene’s name was in the book’s acknowledgements—in code!

‘”Artemis Rat Okra” aka V.E.G. Ham.”’

Jonathan Williams and photographers Roger Manley and Guy Mendes drove around the south in the 1970s until the early 1990s, attempting to meet and document outsider artists.

Sister Gertrude Morgan in her Everlasting Gospel Revelation Mission, New Orleans, LA, 1974. Guy Mendes photo. Courtesy of the artist and Institute 193.

Back to Gene Ham.

https://www.gardenrant.com/wp-content/uploads/2019/08/Gene-Ham-Roy-Blount-Jr.-Okra-080719.mp3

Listen to Gene Ham recite Roy Blount Jr.’s Song to Okra.

This is the scantest little I know of the mythic Okra Illuminati.

Good luck if you try to Google The Knights and United Daughters of Okra.

Not everyone can be blessed with Gene Ham’s good taste.

Please, no more okraphobic slurs of cotton’s cousin.

Set your taste buds free.

The Okra Illuminati originally appeared on GardenRant on August 14, 2019.

from GardenRant https://ift.tt/2YUt4Ax

#GardenRant

0 notes

peppernephew7-blog · 5 years

Text

Episode #125: Tom Barton, “The Biggest Problem Investors Have is Things Change…and They Don’t Change”

Episode #125: “The Biggest Problem Investors Have is Things Change…and They Don’t Change”

Guest: Tom Barton. Tom is the Founder, President, and General Partner of White Rock Capital. He helped build the first multibillion-dollar short-selling hedge fund at Feshbach Brothers in the 1980s, where he exposed dozens of stock frauds. Then he became an early-stage investor, going long on health foods and satellite TV. Now he runs White Rock Capital, where much of his focus is on investments in gene-therapy firms.

Date Recorded: 10/04/18

Run-Time: 1:25:50

To listen to Episode #125 on iTunes, click here

To listen to Episode #125 on Stitcher, click here

To listen to Episode #125 on Pocket Casts, click here

To listen to Episode #125 on Google Play, click here

To stream Episode #125, click here

Comments or suggestions? Email us [email protected] or call us to leave a voicemail at 323 834 9159

Interested in sponsoring an episode? Email Jeff at [email protected]

Summary: In Episode 125, we welcome famed short-seller and early stage investor, Tom Barton.

We start by going way back, after Tom graduated from Vanderbilt. He walks us through his early career experiences which helped him sharpen his business analysis skills, as well as his operational skills. He developed a great understanding of different industries, yet also what it was like to actually work in them. This was the foundation for the short-selling career that was soon to begin.

In 1983 Tom went to work for a wealthy Dallas family, and in the process met one of the original fraud short-sellers, nicknamed “The Mortician”. Tom knew nothing about stocks at that point, but under the guidance of his new mentor, realized that his analytical skills aligned perfectly with sniffing out short-selling candidates. He reasoned “isn’t it easier to spot something that’s going to fail than be certain on something that’s going to succeed?” He then began digging into the research, and finding slews of fraudulent companies.

What follows is an incredibly entertaining story-after-story of the various frauds Tom sniffed out (and made money on). There was a company claiming it could change the molecular composition of water… one deceiving customers about building-restoration after fires… a biotech claiming it could cure HIV… By the time 1990 rolled around, Tom’s returns were over 80% and he had generated a couple billion dollars.

There’s a great bit in here about “The Wolf of Wall Street” (Stratton Oakmont). Tom is the guy who took them down. Related, the “Wolf” himself snaked an apartment out from underneath Meb a few years ago out here in Manhattan Beach, CA. The guys share a laugh over this.

Eventually the conversation morphs from short-selling to when Tom’s strategy changed to going long. It involves managing money for George Soros, and some of Tom’s early long winners.

This dovetails into how Tom got into biotech, which is where he’s spending lots of time today. Tom tells us about his introduction into gene therapy, then successes with the company Intrexon. He talks us through some small companies he’s been a part of that have already sold for huge paydays…for instance, one purchased by Novartis for $9B.

This is a must-listen for any short-sellers, market historians, private investors, and biotech investors. And Tom’s most memorable trade is a doozy. This one involves buying puts for a hundred and something thousand dollars…which he sold for $13M.

These details and far more in Episode 125.

Links from the Episode:

0:50 – Welcome and introduction to Tom

1:23 – A look at the early part of his career

6:17 – Transition into being a short seller

9:20 – Why shorting was so much easier in the 80’s and 90’s

14:00 – The response to their strategy in the beginning

17:44 – Stand out shorts and the work that went into them

28:27 – Pushback on betting against fraudsters

31:56 – Involvement with Stratton Oakmont (The Wolf of Wall Street)

36:06 – Another short-selling experience with a real estate group

40:00 – Transition to long investing

44:08 – The importance of where you get your ideas

46:57 – Tom’s global investment strategy

52:45 – Tom’s interest in healthcare

1:06:31 – Tom’s look toward the future

1:13:38 – Behavioral underreactions

1:13:44 – From Alchemy To Ipo: The Business Of Biotechnology – Robbins-roth

1:16:56 – Important – find the single best source of information

1:20:50 – Most memorable investment

1:23:42 – Tom’s plan to raise his profile

Transcript of Episode 125:

Welcome Message: Welcome to the “Meb Faber Show” where the focus is on helping you grow and preserve your wealth. Join us as we discuss the craft of investing, and uncover new and profitable ideas, all to help you grow wealthier and wiser, better investing starts here.

Disclaimer: Meb Faber is the co-founder and Chief Investment Officer at Cambria Investment Management. Due to industry regulations, he will not discuss any of Cambria’s funds on the podcast. All opinions expressed by podcast participants are solely their own opinions and do not reflect the opinion of Cambria Investment Management or its affiliates. For more information visit cambriainvestments.com.

Meb: Welcome podcast listeners. Today we have what I expect to be an incredibly entertaining and fun episode for you. Our guest helped build one of the world’s first multibillion-dollar short selling hedge funds at Feshbach Partners in the 1980s, where he got to expose dozens of stock frauds. And then became an early stage investor going along on lots of stocks, and private companies, and health food, and satellite TV’s. Now he runs White Rock Capital family office, where he’s spending a lot of time thinking about biotech. We’re thrilled to have him on the show welcome Tom Barton.

Tom: Thank you, thanks for having me on.

Meb: So Tom, I figured we’d use your career arc as jumping off points to talk about a few different topics that are near and dear to your heart, including short selling, and private investing and everything else. But maybe bring us back to the beginning, I think you are a Vandy guy, I’m actually going to be in Nashville next week. So podcast listeners come on out to Topgolf I’m giving a talk there. But walk us through it. You did your MBA I believe, were you a short seller out of the womb? How did you get into this world?

Tom: After I graduated from Vanderbilt in the late 70s, the first job I took was in New York City for W.R. Grace. Back then Grace was actually a really great diversified conglomerate. And I worked directly for staff that was right under Peter Grace who was the CEO, chairman, he was basically pretty much a dictator of W.R. Grace. And I did all the confidential work, so if they were gonna acquire anything, divest anything, make any major changes within the company, they would come to our staff. So no, I didn’t get to make any great strategic decisions, but I had to do all the work, and I had to do all the financial work, and the marketing strategic kind of analysis, for literally hundreds of companies.

Because if you looked at Grace back in those days, first of all, they were an industrial company, and they were in things like Cryovac which is the plastic wrap that goes over all the steaks. And they own 90% of so many other markets, and they had dominant shares in industrial natural gas kind of industries. And at that time, you weren’t getting a very big multiple. So they started diversifying. They started buying all these consumer product companies, and restaurant chains, and sporting good stores. Most of these don’t exist anymore or they were sold off, so I had to do all the analysis. So pretty much I worked 19 hours a day for about three years, and kind of learned every industry.

That was like an excellent place to start, excellent place. But during the process, it became very funny because I was reasonably close to Peter Grace, and he said to me one day he said, “Hi Barton” he says, “You’re the only guy who works for me that will come back and tell me how crappy everything is.” And I go I don’t know, I go out there and I look at the stuff. And look I’m pretty young back then I’m like 25, and I go it’s pretty obvious this is like really in a lot of trouble.

He says, “Well this is what I’m gonna do, I’m gonna send you to 20 cities over the next 20 years, and you can clean up our garbage stuff. Every time we have a problem I’m gonna send you to the next place.” And I went home that night, and I went “That does not sound like a good job at all.” So that was pretty much the end of my W.R. Grace days, I just could not… I couldn’t imagine going to 20 cities. You can imagine the cities they would have sent me to also. So I left. I went to Dallas started a firm with another guy it was a manufacturing firm, it turned out we ended up building most of the fixtures for Blockbuster video. If you remember the kind of crazy fixtures they had in there, we just kind of morphed into a very unusual kind of manufacturing business. specialised on that.

Somewhere in the process, a European company came in and bought me out, and I got my first pretty much tall capital. It was a decent amount of money back then, but it’s not huge, but it was certainly enough to let me be independent if I wanted. And after that which is we’re talking a period of… this whole thing from Grace, let’s say 1977 to ’80 then ’80 to ’83. In ’83, I was done with that segment of my life and I knew how to run companies, I knew how to analyse companies.

I understood about balance sheet, P&L, cash flow, but I also understood what it was like to actually be in a plant and have to count inventory and actually collect receivables. So I got this really great combination of understanding all these industries, then actually having to work in one, where I actually had to build a company, make payroll and all those kind of things. So it was a really good combination, and then my whole life changed and I started become a short seller in 1983.

Meb: By the way, do you know that there’s still a Blockbuster video in Alaska? I think there’s only one left I can’t remember why there’s one in Anchorage, but it’s probably like a museum at this point.

Tom: You know, a really good friend of mine back then who I met because of the quality of data we came up with was Alan Abelson, who was editor for “Barron’s”. So I still think he’s the single best writer, and the most accurate guy that I’ve ever dealt with in the press. And he was talking about the collapse of Blockbuster video about 10 years before it finally collapsed. And you know, when Netflix first came out, they’re we’re gonna put them away, It took a long time. But you know, it was a really interesting company and they had a niche, they just didn’t get out of it fast enough.

Meb: We talk a lot about that with the high expensive fee mutual funds long-only world that’s kind of the closet indexers at some point. I think all those are gonna go the way of the Dodo, but we haven’t… don’t know when that’s gonna happen. We often talk about is there gonna be a Blockbuster-Netflix moment with those, or is it just gonna be a generational transfer? I think it’s probably the latter. But anyway off topic all right, so you’ve got some pretty good operational experience and pretty good practical experience analysing companies.

Did you just kind of wake up one day and say you know, I feel grumpy I didn’t have any coffee, I’m gonna start looking into some of these crappy companies and betting on them to go down? What was kind of the transition? What was the next phase?

Tom: Interesting enough when I was younger, I never woke up grumpy, so that was good.

Meb: I wake up grumpy every single day. I crawl out of a coffin, my dog licks me in the face, and I crawl to the coffee machine. I always laugh at people talking about their very intentional mornings where they do a lot of meditation, and I just don’t have that gene. When my genome gets sequenced we’ll find I have the grumpy morning coffee Gene, okay so…

Tom: As you get older it’s gonna get worse, I’ll just tell you that. So in 83, I went to work for a very wealthy Dallas family, and they had all these investments. But they only had one investment that just was printing money every year, it was from a guy that was actually right next door to us. This guy Rusty Rose, and I went over and I met Rusty for the first time, and anyone who’s older will know about Rusty, anyone who’s younger would not. But Rusty was one of the original fraud short sellers and probably the best of all time.

A Stanford Harvard guy, unfortunately, he passed away a few years ago, but Rusty was so good at short selling that they actually gave him the name the mortician. And so if Rusty shorted your stock, it was going to go to zero because he didn’t mess with anything that wasn’t like really a fraud. And nothing that you would actually even cover a buck. So I went over and I met Rusty, and I knew nothing about stocks, I knew nothing about Wall Street even though I’d gone to business school. I took out a monetary policy but I didn’t waste any time on the stock market or the like.

So he explained short selling to me and I said, “Wait a minute, my best attribute is to be able to do detailed research, and to find things that are having problems, this seems perfect for me.” And back then, in particular, I felt like the number of businesses that were founded that a larger percentage failed than businesses that succeed and also is it easier to spot something that’s gonna fail than to be certain on something that’s gonna succeed. So I said this is great, I said, if you’ll find ideas, I’ll do all the research for you.

It was just right down my alley where I can make the phone calls, I could do the spreadsheets, I could read all that stuff. I have a really good… probably the best thing about me is common sense. I just have kinda like this fairly simple approach to judgement of good and evil, and I tend to get it right, so it’s just kind of the perfect place. And I just started working next to Rusty. I was in the office next to him, but Rusty would come over and say “We oughta look at this company.” And I would look at it, and I go start making calls, and I could not believe how many companies out there were 100% frauds.

Now you gotta understand this was a unique time in history, and you cannot reproduce… all your listeners, you cannot reproduce this kind of strategy again. This is something that could work in the ’80s in the early ’90s. It cannot work today, you’ll understand why. Because back then it was simple to do a fraud, you could do a fraud… and there were so many companies that were either investment banks like the , D.H. Blair, Stratton Oakmont which I’m sure most your listeners have heard of because of the “Wolf of Wall Street.” We can talk about that, I turned Stratton Oakmont over to the FBI.

But there were companies that would float these IPO’s and the whole businesses were fraud. But that was back in the day, you couldn’t even find stock symbols. I mean literally someone would give me the name of the company, I couldn’t find a stock symbol for two or three days. And it was also… there was nothing online. You couldn’t get 10K’s annual reports, quarterly reports, you couldn’t get any of those. So you had to go to a company like Disclosure, and Disclosure would actually print these documents out to you. So the only way you could ever figure anything out about a company is you’d have to get really get a hard copy read and go through.

So was a very slow process, and there was no overt sense of a public guardian. Like you know, right now someone tries to commit a financial fraud, the public is everywhere and they’re tweeting about it and the whole deal, back then total crickets. And so a guy could launch something, he could run the stock from $2 to $19, nobody even know about it. And we got very, very good at finding those, and it turned out we would find those things because we would start tracking certain investment banking houses, if you wanna call that you know. And those houses were not shy, and you know, the SEC would go in and slap them on the hand and give them a fine.

But the SEC wasn’t really refined in that area of going after frauds, and so the SEC had to actually learn the process of how to do it. And we can talk about that in a second, but the number of frauds that we ran across were enormous. And basically, we never got beat, so we could do 100 shorts, and we would win 100 times. Now, it’s not that we wouldn’t suffer some pain in the process, but we never got beat, we were never short, and also we were not shorting overvalued companies at all.

So just to give you an example back then, there was a company that was called Instant Hot Water, and Instant Hot Water the claims were very, very simple. It doesn’t even matter whether these claims were accurate, but just understand the level of the story here. The claims were that everybody knows that hot water molecules stand up cold water molecules sit down. So this guy claimed that he had an instrument or basically an electrical motor that he could put wires into water, and he could flip a switch and molecules would stand up, so he called it Instant Hot Water. And that was a public company, and that actually traded, well obviously that was just a total fraud.

There’s another company called S. Taylor which was Snooki Taylor which is a company that claimed that you could go down the black sand beaches, and you know, you see the sparkling on the beaches well that’s silica, that’s not gold. But they would tell people it was gold and they drag these things down along the beach. And at the end of capturing black sand, they would throw it around, they’d open up the bottom, and sure enough gold would come out of the bottom. Well, it’s pretty obvious how they did that right, they stuck gold in the bottom.

So the earliest days, the first 200 or 250 or 300, or 400 companies, we did, were all like that. They were just completely made up garbage companies. And it turned out that we got very good at finding them, we got very good at doing the research on them. We actually wrote a book on how to do research on frauds. Now we didn’t publish it. I still have it my office. It was like 200 something pages. So an analyst who come in and figure out how you would actually find a fraud, investigate a fraud and the like. But we got so good at it that we would just find a fraud, we call the SEC. I had several guys at the SEC in Washington, and I would pass these frauds along to them.

I’d give them all the work, and for years they really couldn’t quite figure out what to do with them. But by about 1986, ’87, they started really figuring it out, and so you could present them the data, it was always black and white, and within a fairly short period, they’d go investigate them. And then it would take a little bit longer to close them down. So this became an incredible business. I think I started with a million and in four years, I’d turned it into 15. And I wasn’t really pressing it hard, but it’s just like we were just never gonna get beat.

Meb: And so like the process was you would put on a short say SEC these guys are clearly a bunch of fraudsters. It reminds me of an old phrase my grandmother would use which is using some elbow grease, so actually doing some like hard work meaning and kind of value-added digging around, a little harder today with a disinfectant on the Internet. And so you would put on a short and most of these I assume were terminals. Like they would essentially go to zero or go away, what was then the process? So you did this for a little while, you built up this 15 million capital and did people start to wake up to this at all? What was kind of progress?

Tom: Even in the early days when I really was… I mean I was pretty happy with that kind of result. I then merged in with Feshbach Brothers. Now Feshbach Brothers was still a small firm. It only had about $100 million in capital at the time, but there were three brothers there, and the three brothers were absolutely brilliant, but no formal education at all, zero formal education. They were really, really smart guys. And we started swapping ideas because they knew Rusty Rose, and we just got along really well, and we merged our firms together.

And then we raised a little bit of money. I mean basically, we wouldn’t have to do anything except accept money coming in because our returns were crazy. My return each year was always over 80%. This went for gosh I don’t know, nine years or so something like this. I mean our returns were phenomenal. And by the time we got to 1990, we had a couple billion dollars, and I believe from the data that I’ve read, and I’ve never tried to substantiate it, the entire hedge fund industry was about 10 billion. So at one time, we were 15 to 25% of the entire hedge fund industry, that’s how early we were in the process.

So we built up to a couple hundred people, but it just a completely different time because we had 26 people in the accounting department. We had to write the original software that’s now Advent which is used by almost every hedge fund that does any form of shorting. We had to write that software, we actually wrote that at Feshbach Brothers. And that became what is now Advent which virtually everybody uses. We should’ve kept that company because there was really no way to handle large numbers shorts, large number accounts, and the like.

We helped Merrill set up their short selling box, which basically for your listeners if you short a stock you have to go borrow it. No one really knew how to do that in mass. We helped Merrill Lynch do that. So we were very instrumental in developing the short selling industry into something… well developing into industry and then having systems in place so you could do it in large amounts of dollars. We were early about that.

But I think what then naturally developed besides the fact that we had a large amount of capital, we also were lucky to run… I mean we had the crash in ’87 which I never vote for a crash. But if there’s gonna be a crash it might as well be short, so I would prefer the world not crash, I’d prefer to make it on the long side. So I am never looking for bad things to happen. I remember we were short, I think it was Jet Blue at the time or no, it was Value Jet. And it was a terrible, terrible airline, and they had all kind of maintenance issues, and they were buying planes that were just for $2 million, and it was nothing but trouble.

And I remember the company went away, but they had to have a plane crash in the Everglades, just a sickening feeling to end up making money on people doing poorly. But generally, we weren’t on the Value Jet side were more on just terrible, terrible businesses.

Meb: I think a lot of people listening to this, that’s kind of amazing too you know, the ’80s and ’90s rip-roaring bull market. And to think that in a time when U.S. stocks, in general, were performing so well, that there were still these sort of inefficiencies and frauds out there that you could find opportunities despite the huge headwinds of an upmarket is pretty amazing. Are there any other like kind of stories that come to mind you know, as you guys were doing all this research. Are there any ones that stand out?

Tom: There’s a few that I think are really, really interesting when you start doing frauds of businesses that don’t exist that’s one thing, but when you start doing fraud of businesses that exist, some people might claim that Tesla is a fraud, I don’t think it’s a fraud. But Enron would be an example of a real business, that was a real business that really didn’t exist right. When you start off doing complete scams like Instant Hot Water, and even the very famous ZZZ Best that we turned over to the SEC, which was Barry Minkow, he went to jail. We could talk about that, you know, the Drexel Burnham.

Meb: What was that business? It’s great name.

Tim: Well ZZZZ Best was probably the highest profile fraud back in the ’80s. It was a Drexel Burnham deal, and they basically claimed that they were going to all these buildings and they would do restoration after fires. And what they would actually do is… and they tricked everybody, including Drexel, but they didn’t trick us for one minute, was that they would go out to these buildings that were under construction and rehab and the like, and they would hang up their helmets, their construction helmets and their T-shirts, and they’d bring in the bankers and people like that. And they’d see all their stuff laying around, and then they would leave, and then they would take all their stuff out.

You would think it would be pretty easy to figure out that there weren’t that many big fires. I remember when the MGM caught fire a long time ago in Vegas. That was like a major story. So I remember calling the people at MGM and go your carpet restoration how big was that? Thinking, wow I mean that’s an entire hotel almost. It was like $3 million. These guys were claiming they had carpet restoration business of $10 and $15 million. It was just insane you know, and it was easy to track because you figure out the towns that they were in, then you call the Fire Department, the Fire Department would say there were no fires. But they were fooling Drexel Burnham, and they were fooling the public.

And so the SEC raided them. They ended up… Justice Department went after Barry Minkow who’s gone to jail, come out of jail, gone to jail, come out of jail, I think he still might be in jail. But real businesses like that became very, very interesting. And then my first biotech… wasn’t really biotech it was a pharma business was one in my own backyard in Dallas, which was probably the most fun I ever had on any company. Which was called Carrington Labs. And Carrington Labs claimed in the ’80s that they had a cure for HIV, well basically a cure for AIDS.

None of us even knew what AIDS were, so we had to do all this research to even figure out what AIDS was. And then we had to do a lot of work on Carrington Labs even though they claimed that they were curing AIDS with aloe vera. But I remember the funniest story was they had one doctor in Fort Worth, and he was curing all these people. And I remember calling him and by that time I knew what the symptoms were of AIDS, and saying look, if you had these kinds of symptoms, these symptoms, he would go, “If you had those symptoms you definitely have AIDS.” And it’s like, “I’m curing and all these people of AIDS.”

And so he would ultimately give you names of people that he was curing, and you would go follow these people, and you would find out that they were passing away. So it’s a tragic story, but you’re trying to figure out maybe this company really has a cure for something that is very public… I mean the profile of AIDS back in the ’80s it was so high right. And then you know, ultimately we found these people are passed away, we go back to him go, “Yeah, well these people have passed away.” And he’ll go “Yeah, I cured them, and then they go back and catch it again.”

It was such a joke, but what happened from Carrington Labs is that they were huge money guys, one of the second guys at one of Ross Perot’s companies EDS, second or third guy. I think it was actually the third employee, he was promoting all of this stuff. So you know, they called the SEC on us, and the SEC did nothing because they said they were trying to run a real company. But then there was a huge congressional review, and the congressional review was about us at Feshbach Brothers. And there’s a book out, there’s like about a 400-page book about this congressional review of short sellers, because all short sellers back then had to be criminal, right? I mean we were making up these stories about these great companies.

And I remember… and they asked me to come and testify I would not go, because they had like six companies testifying in front of Congress, and all six of them were complete frauds. But it didn’t matter to Congress. They didn’t have the slightest idea. They just had one congressman who wanted to go after short sellers. And so I remember the funniest thing was they said that me, Tom Barton constantly use the name Joe Barton making calls, and Joe Barton is my partner, he’s also my brother right. And so they wanted to say that I used the name Joe Barton, and we had a congressman in Texas Joe Barton. So they said I was impersonating a congressman. They didn’t even know I had a brother named Joe.

And so Congress is up there talking about how I’m using this name of Joe Barton, and it was really kind of a hilarious thing but they made a big deal out of it. And they were gonna try to go after everybody and bring criminal things, and it basically went away. But Carrington was really funny, and they were just… I don’t know how many of these names you wanna go through? I remember… here’s a very simple one. We were short Home Shopping Network back then, and of course, HSN has survived.

But back then we were very concerned because their inventory numbers were huge. They would carry 90 days and 120 days and 160 days of inventory, and we figured out the inventory that they were carrying wasn’t any good. Because Home Shopping doesn’t carry inventory right. They’re supposed to bring inventory, put it on the air, it goes away. If it doesn’t go away, they put it on the air one more day and then it hopefully goes away. Then they discount it. You don’t carry inventory for Home Shopping Network, but they were carrying 160 days, so obviously they were buying a lot of bad stuff.

And Home Shopping Network almost went away, as a matter of fact, I’m not sure it may have actually filed bankruptcy and come back out, I don’t recall. But this is the level of research… but I’ll give you one more story on the short side and the level of research it took and how we actually use that today. Because this is I think is… it’s an interesting story and I referred to a recently in “Barron’s “interview that we did, but I gave a small snippet. But we’re short of a company Endo-lase, and Endo-lase had a laser that was one of the first medical device lasers, and it was about a million bucks which means only a few hospitals back in the ’80s could even afford a million dollar laser.

And their sales were enormous, but their accounts receivable were over a year. Which you don’t have to be a genius to know there’s some problem there. So we called the company. We said, “Hey your accounts receivable are over a year what’s going on?” It happened to be a New York company right up here on Columbus Circle, and the guy there who… the end of the story is he ended up fleeing the country. He said, “Look, we sell them to the hospitals. It takes them a long time to pay for them, but our cost of capital is so low that lets us sell them, we collect them over a year or two years. It doesn’t really matter, it’s basically financing.” And we said, “Okay,” and hung up and I didn’t believe the story.

So I told my analyst, “Identify every hospital in the United States that can afford a million dollar laser.” There were 200 and something. We called all 200, all of them. We said, “Hey you ever bought this laser?” “Nope, never bought the laser. Nope, never bought the laser. Never bought laser.” So we called the company back up, “Hey 200 hospitals, nobody bought the laser.” “Oh yeah, we sold them to all these hospitals. Come up and you can look at our books.” Okay so I go up and I have a guy go with me because I think that possibly it’s a mob-related deal they’re gonna kill me. And a lot of things we shorted were a mob-related, and we can talk about that briefly in a second.

But when I looked at the books and sure enough their accounts receivable for all these hospitals that we had called. And he said, “See we sold them all.” I made him go back call all the hospitals, and sure enough none of them had bought it. So they were just making it up. I think Arthur Andersen was the auditor back then, for people who remember the name, Arthur Andersen. But it didn’t matter could be an Arthur Andersen, Price Waterhouse, it could have been any of those guys. They were all being taken by these kinds of guys.

So we had to do a lot of work, and so we basically figured out that they were made by Messerschmitt, the German company. We talked to Messerschmitt, we said, “How did the lasers get here?” “The lasers came by boat.” “When do they get here?” “They come here on a Thursday, we ship them so and so, we get them, they’re paying us for the lasers. We really like Endo-lase.” So then we have to call the dock in New Jersey, and we talk to a guy there and he says “Hey these lasers are coming in.” He says “You’re lucky because this laser has its own number. If it’s tennis shoes I cannot tell you what’s coming in and where, but this laser I can tell you exactly when they come in. We get them every Thursday, third Thursday of the month.”

I said, “That’s great.” So we had a private investigator, he went down watched the truck pick up these lasers and they took these lasers, and they’re storing them in his grandmother’s house in the garage. Well, you can imagine now that we have that answer and that story what do you think the SEC is gonna do? Do you think it’s hard to short a stock? Remember there is no uptick rule then, you think it��s hard to short the stock? Do you think you worried about shorting the stock? No. So you just call the SEC and go, “Okay, this is where the lasers are coming in. Go over there the address, open up the garage, that’s where all the lasers are.” And that’s kind of what happened and the guy who ran it, Michael Clinger, he skipped the country and he went to Israel, and he’s had some other run-ins with the law since then.

But this is the kind of work that you’ve gotta do, you just can’t look at the top. You can look at the top and go one-year of accounts receivable, but that’s not the way you’re going to have a certainty of 100% that you got it right. Those are only kind of shorts I do, so I would not be the guy that you’d wanna call on Tesla. I’ll give you an opinion on it, but I’m not the guy that you will call on Tesla.

Meb: Meanwhile that grandma had an amazing garage sale selling lasers to the whole neighbourhood.

Tom: Actually she didn’t collect for him either. I think they were just hauled away and returned.

Meb: So we talked about lasers, it seems like betting against the mob would be kind of a questionable target for your own personal life expectancy. I mean how many times would these companies push back? Would you ever get any threats? Being a short seller is so hard even today where half of the country thinks short selling is un-American. But how often would the companies react kind of aggressively or angrily or anything else, anything come to mind?

Tom: Yeah, first of all, let me tell you what is un-American, promoting companies with stories that are false, whether you’re long or short, that is un-American. Trying to figure out whether people are telling the truth, that’s very American okay. Risking your capital is very American. Very un-American, starting rumours about companies that aren’t true to drive it down or drive it up, very un-American okay. So I just wanna clear that because you can’t put all short sellers in the same category because it’s not fair, it be like putting all people in the same category.

There are terrible short sellers out there that just start rumours and then do these hit and runs, and I punch those guys in the nose okay. I hate those guys, but there are other guys who do really detailed work and they help the market.

Look in the old days these companies that were run by mob contacts you know, New Jersey, New York, Salt Lake City, Salt Lake City was huge, Newport Beach, some great parts of the country, West Palm. The places you would expect maybe a little bit more mob involvement, when something went bad they used to beat up each other, they used to go get the guy who do the promote and beat him up. And there were cases we heard about that, where guys were… the big promoter the guy from the SEC would say to me “Yeah he got beat up” and the like.

I never was really that worried about it because to them it’s just… or to guys like the D.H. Blair, it’s a lot better just to go to the next one. They probably made money on it anyway. Okay, let’s go do another one, it’s better than just bringing more and more attention to yourself. So it wasn’t much of a concern, but it became a little bit more concern in the early ’90s, and I had really good security guy. I started bouncing things off him, he was really good. He was Ross Perot’s guy. As you know about Ross Perot, Ross Perot knew something about security, and I would bounce these things off he’d go “Forget it, forget it, forget it, forget it, forget it.” Then I had one. He’d go “No, that’s a real one.”

And so after that I just decided you know, I’d made enough money doing this and also what advantage is there to be public about all this stuff? So I just pretty much went underground and since ’93, I’m almost unheard of. And that’s pretty much the reason, it wasn’t really the threat from them, it was just when you get a certain level of publicity you get a certain issue that goes with it, right. So I just decided the publicity was not that good, but really in the late ’80s in the ’90s, I couldn’t walk anywhere, I could not go to a ski slope without people stopping me, I was that well recognised.

You know, in New York I couldn’t go anywhere, and I had all the speaking engagements and stuff. But you know, the great thing is that’s before Google, so if you go back and Google me you don’t find that much stuff. So you know, I went underground in ’93. Now I’ll tell you this, it’s not really advantageous to business, it’s a lot better to business if you have a high profile because everybody’s calling you seeing deals. Then all of a sudden you go underground that’s not great for business.

Meb: Well, I joked with your earlier that you have probably my favourite website I’ve seen in the past decade which it has I think… it looks kind of like Berkshire. It has like two lines of… all white page with two lines a black type, so my favourite. You know, you mentioned earlier a quick reference to Stratton Oakmont and I think that name will probably ring a bell with a lot of our listeners. Maybe talk to us a little bit about your experience and an involvement with that shop?

Tom: That whole movie “Wolf of Wall Street.” I saw it and I laughed the whole time okay. It’s a very entertaining movie that is not the way the story went at all. I mean the story was very, very simple of a firm that was running stocks up, selling the stock they owned, and instantly the stock collapsing. It was a very simple pump and dump, very similar to what another 20 firms were doing at the time, and it became very obvious after doing a lot of work, a lot of work, similar to the kind of work I’ve described before, that these guys just wouldn’t file 13D so they could own 80% or 90% of the stock. It would look like there was a lot out the float, they could trade it back and forth, and then once you’ve got a stock to a certain level… Actually today it’s called momentum investing when it gets to a certain level then everybody wants to own it, and then they sell and everybody is held holding the bag, right.

Stratton Oakmont was nothing more than that, was just another one that was pumping out crappy deals. We knew about them. We turned it into the SEC. Ultimately had discussions with the FBI over it, and then they were raided and that was it.

It wasn’t any more exciting, sexy, then any other story except somebody decide to do a movie, and if they said, “Well this guy didn’t file with 13D, which means you own more than 5% and he owned 90% and therefore they could control the stock, that aren’t much of a movie right. I saw the movie. I was just in hysterics because you know, I’m not aware any of that stuff happened. Sinking a boat, and crashing a car like that, I’m not aware of any of that.

Meb: You need a little Hollywood to spice it up, there’s actually a personal angle to this with me where I live in Manhattan Beach California. And back in the day when I was in my late 20s, had a couple roommates we were… maybe early 30s can’t remember at this point. We were trying to get a new nice apartment and had put in a bid and the landlord accepted, and then called us back a day or two later and said, “Actually I’m gonna rent out someone else.” We said what are you talking about? He said, “Yes, but I’m renting it out to this guy who his life is gonna be in a movie based on… and he’s gonna be portrayed by Leonardo DiCaprio.” And I said, “Oh my God.” So I lost an apartment to him. He’s been on my doghouse shit-list ever since regardless of the bucket shop he ran. I’m just mad because we lost the apartment.

Tom: I’ll tell you a really funny story, to me it was very funny at the time talking about the mob and stuff. I came to New York. The SEC asked me to come to New York and speak to the district attorney in Manhattan which I was more than happy to do. And I came and I get in a room and he comes in, very recognisable okay, and there are three or four SEC guys there, and they’re very interested in this one particular firm. So I start telling them all about it and they’re all real interested. All of a sudden, the attorney gets up and he goes “I gotta go,” and I go “What do you mean you gotta go? We’re only like 30 minutes into thing?” He goes “Hey we caught a guy at the post office opening up letters and he stole recently four subway tokens, and that’s a felony.”

He actually left this meeting where we’re talking about all these mob guys rigging these stocks to go get a guy who had stolen four subway tokens. I thought at that time boy, I’m not really sure how you rank these in terms of crime, but it was kind of a crazy thing. It’s like I thought… I looked around and said “I don’t think my story is that important but we’re talking about…” subway tokens back then they were probably 25 cents it was like a dollar maybe $2. And they had taken off so that’s my mob thing.

There was another story that was real funny too in a certain sense. It was a company Koger Equity and Koger Property, I think they were the largest class B building owners in the country or certainly one of them. And the guy RR Koger was just really well known in Florida. And we got a call that “Hey you need to look at the transfer of these assets because they’re transferring assets back and forth.” And so what they were doing is you know, real estate prices were starting to fall in Florida, surprising okay. There’s a period that they fall and a period they rise, and what Koger Equity and Koger Property were doing is they were selling properties to each other, but Koger Properties would buy one for 10 million then sell it to Koger Equity for 25. Then Koger Equity would have bought a property for 30 million and sell it back to the property for 50 million.

So they were trading properties back and forth and each time they would make that trade they book a profit right. And the value of their assets would go up. So we figured it out. We turned it into the regulators. They raided the companies, companies went to zero. About a year and a half later, I get a call from an attorney in New York he says, “We would like…” and it became known that I was the one who turned him over. It was either in the press or something of the like, or they got it from the SEC I don’t know. I’m not certain.

So the attorney calls me he says, “We represent RR Koger. We would like to come down and interview you. I said, you do not wanna come down and interview me, he goes “No we do.” I said, “No, you don’t you’re gonna waste my time would be the biggest mistake in your life.” He goes “No, we do,” and so I try to block it about four different times and finally it got scheduled. So I was gonna have to do a deposition in Dallas over these companies that went to zero. So at that time, the attorney that’s gonna represent me was an ex-SEC guy, really great guy, really funny guy Tom Vonstein [SP] was a great guy, and super smart.

So he says, “Okay Barton,” he says,” You know, you gotta be prepared for this.” I said, “I don’t have to be prepared. Let’s just meet with them.” They come down to Dallas, and it was the most amazing thing because when the door opened five attorneys came in, they were all in their late 50s, full silver hair, three-piece suit. It’s 100 degrees in Dallas Texas at the time. These guys looks like the TV show. First guy comes he’s more powerful, then the second guy comes in, and he is more powerful, the third guy comes in, it’s that kind of deal. And they’ve got these briefcases that probably cost $10,000 a piece and they sit down.

I go in, in a t-shirt, shorts, and tennis shoes, and no socks okay, and I go in and I sit down at the table, and I put my feet up on the table right in front of them okay. And they’re very serious, and I’m laughing with Vonstein and they’re gonna record it, and they’ve got the cameras there, and the stenographer. And incidentally, they had the judge on the line too because they thought that I might become a problem, they were going to use the judge to force me to answer questions about it right.

So we sit there and they go, “Okay, we’re gonna start this thing, judge you ready?” “Yes, I’m ready.” And roll the cameras and take the notes and they start the thing. And the guy says to me… he goes, “Please state your name,” and I go, “I’m not giving you my damn name. You don’t need my name you know exactly who I am. But I just wanna tell you before we get started…” Now I’ve been doing this 10 years, so I had a reputation okay. I said, “I just wanna tell you before we get started, your client is the number one white collar criminal I’ve ever run up against.” At that point, the lead attorney says, “Hold on just a second please.” And all five of them get out, and all five come back in they go “Mr. Barton thank you for your time that’s the end of the interview.” That was the whole thing And do you know what they were trying to do? They were trying to show that if I could figure it out by looking at public documents, that anyone could figure it out, so therefore it was not a fraud.

Meb: You clearly had this niche, you were successful in finding these frauds. At some point you also started investing on the long side too. I know you were managing money for Soros at some point. Was there a transition? Was it something you just started doing both at the same time?

Tom: No, at the end of literally 1990, short selling in this form and fashion was over. It’s just that so many of these houses that were pushing these frauds were gone. Remember the S&L and the bank crisis came up? We were sure short every S&L that walked because we just were… we were short almost all the banks because they had 10 times their equity in real estate and real estate was all collapsing. And the short businesses I had just described over the last 45 minutes was over, so D.H. Blair was gone. All these slimy brokerage firms were gone. The SEC was on top of it, and literally, we couldn’t find hardly any more of these. They were no more Instant Hot Waters.

And you know finding a Koger Equity, Koger Properties that’s a tough gig okay. It’s tough to do the work on that and find those that are that big. It’s so much easier to find a company that really doesn’t exist, it has a big stock price. So it was over, and in 1990 we had a great year at Feshbach back. In ’91, we did not have a good year because all the shorts were going up. And most of the… not most but a good amount of our money wanted us to stay short and we just couldn’t stay short. And so we actually had liquidations in ’91. And we actually told our clients who said, “Look we’ve gotta go long because we can’t do this anymore. We’re just telling you it’s over. Momentum investing is now hot. If you’re short a company, short squeeze is really important.” They were just starting to list stocks. I’m not sure they were listing there, but people knew what the short interest was.

At some point, they start they started publishing short interest. And so really the source of shorts was gone, so Feshbach Brothers had to completely morph and we were just not going to morph that firm. So my brother Joe and I, we left and we set up our own kind of family office in ’93. However, we didn’t change offices because we were always in Dallas. The Feshbach Brothers had headquarters in Palo Alto. We were always in Dallas, so we didn’t have to do anything but change the name on the door.

I remember walking in and my secretary was there, she’s been with me for 35 years, and I said, “What are we gonna do? What are gonna call the firm?” And she says, “Well you know, how about White Rock Capital because we’re near White Rock Lake?” I go, “That’s great,” and that’s how White Rock Capital got started. It started in ’93, and the first thing we did was we ended up calling a great contact we had at the Soros, and Soros immediately gave us money and so we were off and running in a completely new business. That happened in ’93.

We were forced… I would have never, ever left that niche in the market if the niche was gonna continue, never left it. I also would have never left the niche of shorting S&L’s because every S&L was gonna go to zero okay. But you know, the biggest problem investors have is things change. They have an outlier situation, short selling of frauds, and they’re great at it. And then it changes and they don’t change, now to Chanos… You gotta give Jim Chanos credit because Chanos has been a short seller all his life.

And so Chanos is a go-to guy to write a big check to be short. So Chanos has had a lot of really great years when the market allows it. And then not great years if he’s short only if the market doesn’t allow it right. But you know, to his credit he made a lot of money, and he stayed there, but I was never interested in shorting overpriced stocks. I don’t want to really make a living shorting Tesla. I don’t.

Meb: It’s hard.

Tom: Well it’s not that it’s just hard, but I’m a black and white guy. If I don’t have the answer, I pass. That’s a critical thing. Because if somebody say short IBM, I go I cannot get my arms around IBM. I can’t do it.

Meb: I think that’s a good lesson because so many investors, they wanna have an opinion on everything, and we’re always telling investors say look there’s tens of thousands securities around the world, you don’t have to have an opinion on Tesla or bitcoin or whatever it is. You can just put it in the too hard pile and move on to something that’s a lot simpler and clearer. But investors because of the news flow or just the drama and excitement of a lot of these stories and obviously Tesla, Tesla has it all it’s an exciting story, but we always tell people it’s like you just pass. You don’t have to have an opinion on every single investment.

Tom: Well you know, the other thing is you’ve gotta figure out where you’re gonna get your ideas from. Now we figured out at a early, early stage the best place to get ideas is from retail brokers, not institutional brokers, not Wall Street research, not TV, not the “Wall Street Journal,” great sources, not for us. Why retail broker? Because a retail brokerage generally has as his customer a CEO who runs a real company. So he’s actually got the best sources because he’s probably… some cases you can find a retail broker that has high-net-worth clients, those clients are running businesses. And those businesses by talking to those guys are the very best sources.

So I love when I run across a doctor, and a doctor says to me, “What do you think about so and so?” And I go. “I don’t know, you’re one of the leading oncologists in the world. What do you think about all these companies? They’re oncology gene therapy companies right.” And so almost all of the investors that are out there have access to people that are geniuses and leaders in their field. And so we actually had to train in the earliest days retail brokers to say, “Hey when you’re talking to so and so about their business how about asking them, are there any frauds out there?” And that’s how we started getting a lot of frauds.

And so you don’t have to be an expert on everything, but even more so, you have to decide where you’re gonna get your ideas from and chasing things like Bitcoin or others, These are kind of momentum investors. I don’t know a lot of people that are good at it, some are phenomenal at it. There are some traders that I just am amazed every time, they’ll be the guys who own gold from 200 to 1,600. Or they’ll be the guys who own Bitcoin because they’re really early in the cycle, and they buy it right, and they sell it right. They’re great traders, but I can tell you or your listeners if you have 100 million listeners, they’re going to be 10 of the 100 million that are great traders. The rest of the people have to go based upon detail, based upon business fundamentals, and based upon hopefully being in a market that allows them to win. Some markets will not allow you to win on the upside or downside, there just periods like that right.

Meb: You mentioned how it’s gotten harder in the U.S. and the game has shifted a little bit which, by the way, is I think such a great lesson to investors too where you had so many funds in this past cycle that knocked the ball out of the park in ’08 based on one trade, but after that happened have tried to kind of replicate that. I think it was hard for a lot of people to say okay well that was the one trade and we now gotta move on. It’s not gonna happen again. But I wonder how much of the short selling if there’s gonna be Tom Barton in China, or India, or Brazil, where probably a lot of these shenanigans are still going on, and that kind of value-added research still works in some of these far-flung locales. I don’t know. Have you ever looked beyond offshore at all or you stick mainly to the U.S.?

Tim: Now, Canadian I will short some Canadian companies traded in the U.S. and I had… back in the days when I worked, the Ontario Security Commission could not even talk to the U.S. SEC. And so the SEC would have questions they literally could not ask them. And a lot of work that I did basically helped them write a treaty that allows them to swap data. They literally couldn’t even swap it back in the early days. We were short some things, we’d have to talk to the SEC Ontario Security Exchange, not to get off the subject of your question.

But no, we pretty much have stuck in the U.S. But really, what happened to us was during the process of investigating shorts, we started running across longs, okay. Because remember a lot of our sources are long guys really understand it. You know, not with total 100% frauds, but if you’re going to start doing Koger Equity, Koger Properties you’re gonna start doing even a company like Carrington Labs which it was a real company, it just wasn’t real. And if you’re gonna start doing… Any company there’s some level of fundamentals, you better start talking to the best guy in the field. Because that guy will really lead you in the right places. He’ll have the best contacts.

So in the process of investigating some shorts towards the end of the period, we ran across some really, really brilliant business owners, and that’s how we ended up with one of our first investments which was USSB which became DirecTV. USSB is 90% of what DirecTV ultimately was. They had all the programming and the like, but we were short a company that claimed that they had a satellite TV. It was actually here in New York. We actually visited the demonstration, and while people watching the TV coming on a satellite dish, a guy went upstairs and disconnected the wire from the satellite dish and the picture remained. Which pretty much told us it wasn’t coming from the satellite dish okay.

But in the process of doing the research on it, we ran across a guy who invented basically the eyewitness news trucks, the Uplink Trucks. And then we ran across USSB, and then as a result of that, we’re able to put $50 million in that, which was Soros money, and that became DirecTV. So we started to figure out hey look we can do these things on the long side. But long it’s a lot harder than frauds because frauds are x, y, z. You’ve got the answer you know that they’re sitting in the garage.

Long requires a completely different set of skills, and it requires a completely different set of judgement. And you also have to be willing if you’re gonna do well the long side pretty much at least… well let me put it to you this way. Sitting in the seat I sit, you have to be able to go to a room where 99 people still believe you’re wrong. But the other thing about being a short seller, you go into a room 100 people love it, you hate it, everyone tells you you’re wrong, you walk out you short more, because you have all the data.

So you have to be able to do that on the long side in the early days. Now if you’re trying to buy Apple Computer, you don’t have to be that kind of guy. But remember, I’m a black and white guy, and I like to have a competitive advantage. And I like to be in something that other people haven’t really thought about or at least all the dollars haven’t blown in. So even in USSB, they had tried to raise all this money from guys like ABC, CBS, Disney, I’m just throwing out names okay… NBC, Universal, all these companies, and they’d all looked at the DirecTV concept and said, “It will never work. You’ll never be able to have a picture that’s consistent enough, that’s not interrupted by storms.”

And like every single person passed, and these are people in the industry that are brilliant in their industry. And I looked at it and said, “Well there’s no way it’s not gonna work because you’ve already got the picture, you know how to do this, it’s satellite, bingo.” Actually was an easy exercise once we saw everything they had and the backup of the satellites it’s an easy exercise. So it was even back in the earliest days that I was kind of startled that the experts sometimes would miss it when it’s just sitting right in their face right.

Meb: Well, it’s funny Tom, because you know, the skill set to be short seller you almost have to have something like kind of a skew in your brain. All my good friends that are short sellers they’re brilliant, but you have to be extremely sceptical. And to flip the script to the long, there’s not a lot of investors, they can kind of do both. Because long we had a great comment that I loved, I think it was on the interview we did with Jason Calacanis where he said, “A lot of these ideas for longs if you look at this cycle in particular, and you look at Uber,” he said, “Well no one’s gonna do that because the drivers are obviously gonna rate people, or Airbnb they’re gonna get murdered.”

But then you flip the script in the phrasing that I’d love about looking at longs and these big multi-bagger potential said, what if it did work? In which case, all right what is the potential of this concept and idea? Because a lot of the longs when you’re looking for these 10, 100x baggers, unicorns, whatever that’s really where the potential is. And I think a lot of people… It’s rare to find someone who can do both, look at the short side and be sceptical and then flip the scripts to the long side. Over the past cycle, you’ve also started to get a little bit interested in health care, what was kind of the driving force there? Was a chatting with some of these brokers, where you said, man, there’s a lot of innovation going on biotech? Was it just deal flow? Was your neighbour a biotech guy? What was the interest that brought you into that sector as well?

Tom: You said the right thing when you said is there somebody who got you interested in it. So I’m always a guy trying to find an outlier situation or something that’s new, something I can get a competitive advantage on. Unfortunately, in my career as long as I’ve been around, I just should have bought Google or Apple, the obvious ones right. But my interest level is always something different. It’s like okay yeah, those are gonna work but I’m trying to look for something that’s kind of different more interesting. I don’t know why I’m like that, but I am wired like that okay.

So we did this thing with Soros for about 10 years in 1999 to 2003 and we managed money for other people during that time as well, pretty much still as a family office. And I always had a little hedge fund that I kept together during that period. And from 2003 to 2010, I’ll tell you not really that interesting for us. I mean 2001…2000 was an interesting time right because 2001 everything blew up. But 2003 to 2010 was not the most interesting time, plus I had young kids, they turned out basically to be all American Golf spectacular golfers one at Oklahoma State, at SMU, then my daughter went to Stanford and was and basically an academic all-American there.

And so from 2003 to 2010, I did a lot of kid raising, and I just didn’t find anything that was that interesting. I completely missed the 2008 mortgage collapse even though all my friends were doing it. I just didn’t understand it, I didn’t wanna set up these special accounts. Most these guys would get run over, and I just missed it. And sometimes you’re gonna something that’s obvious. I just went to the Billy Joel concert and I realised everything he wrote that was great… and hopefully, he don’t come back and yell at me for this. But he was about 20 years old by the time he was 60 he’s not writing great stuff anymore.

I think had I seen the mortgage crisis, and I’d been about 15 years younger, I probably would have been all over it, but I completely missed it… So from 2003 to 2010, I’m raising these kids, taking them around the world, playing golf tournaments. But I’m also still investing and the like, and we had some okay years during there. but it just wasn’t an exciting time, it just didn’t happen. In 2010 everything changed for me because I ran across a guy who said, “You need to start looking at gene therapy DNA because now we understand how DNA works, and the science is finally here. And we’re gonna be able to do something with DNA.”

And I just thought it was just totally fascinating, and actually, the guy who introduced me to the most is a guy who runs his crazy company Intrexon. And we should talk about Intrexon. But the guy who runs it, R.J. Kirk is the most brilliant guy I’ve ever met, and he knows every industry as if he’s the guy who invented the industry. And he knows science if he has a Ph D. in whatever it is talking about in science. Whether it is gene therapy, molecular biology, it doesn’t matter. He is a walking encyclopaedia of knowledge, never met a guy like this.

And he explained it to me and of course if you go read Steve Job’s book he says, “That the next great area is a combination of science and technology,” talking about medicine and technology. So now I’m starting to think about this okay, when they discovered radio frequency, there was nothing you could do with radio frequency 50, 60 years ago. And as a matter of fact, how the DNA they discovered, as I recall, three days before I was born back in the 50s. So I’m not a super young guy, three days before. But even though you could understand DNA or any even though you could understand radio frequencies, you didn’t have the technology to do anything with it.

So it took a long time before the iPhone came up from Morse code, took a long time to understand how to use those frequencies. In 2010, it was clear to me that now science and technology are going to work together, they are gonna be able to take DNA, gene therapy, and any other aspect of the human body, and they’re going to be able to manipulate it to cure major diseases. But also to do incredible things in non-health care. And I started looking and every place I looked, it made total sense. So for instance, I used to be national chairman for Major Gifts for cystic fibrosis, and I did that for I don’t know a long time. And fortunately CF raised a lot of money, but everybody knows what causes the CF, but they haven’t been able to correct it.

They’ve got great treatment for these kids that are afflicted, but they don’t have the cure. Well, the cure is to correct the gene, this is what will ultimately happen. And so I started looking at healthcare which I kind of knew, then I started looking at all these industries. And so if you go and you just kind of look at Intrexon, just at the top level… We’re not talking about the stock now, we’re talking about the company okay. If you look at the company, you got a company that has better DNA knowledge than any company on the planet.

But DNA knowledge across 100 different industries, so they’ll be the best at fish, they’ll be the best at the mosquito, they’ll be the best at apples to make sure the apples don’t brown. They’ll be the best at all these other industries because they’re working on them. Where if you go to a Kite or Juno or any of these other couple companies I’m a founder of, we’ll talk about in a second, if you go to theirs you have people that are specialising in CAR T but the guys who are specialising in CAR T, and they’re using gene therapy, you can use that gene therapy or the same DNA knowledge to go impact natural gas and turn it into a solid fuel.

So I looked at this and thought wow, this is going to be the biggest change in our world that we’ve ever seen. And everything that gets done is gonna be disruptive. So I just give you a little example if I come to you and I say, “Meb, I got this idea for a product better than Rogaine. And you know, you grow 25% more hair than Rogaine, and we’ve done these tests and we can show it and would you like to put money in it?” Well if you’ve got half a brain which I know you do, you’d go I’m not putting any money in that thing. I’m not going up against Rogaine. We’ll never get the shelf space, we don’t have the ad dollars blankety blank okay.

Now I come to you and I go, “Hey guess what, we figured out how to cut the gene on and off. And we figured out how to increase and decrease certain proteins, and we figured out how to change hair colour by proteins. And we now, in fact, can, give you a pill and you will grow all your hair back, all of it, and you will keep it. And if you wanted to be its natural colour, you take this pill, if you want it never to change grey, you take this pill.” Now you go, “Really?” The only question you’re asking me is, “Really?’

Meb: No, the question I’m asking you that sounds like you’re describing one of your shorts from the ’80s.

Tom: Well it does.

Meb: It’s a magic pill.

Tim: Yeah, it does okay, except that you and I know for a fact that science is going to figure out how to correct all these human issues. You know for a fact. You just don’t know when it’s gonna happen. So everybody always assumes it’s gonna happen sooner or it’s gonna happen later. And so they say sooner and they go to waste all their money leading edge, bleeding edge, they call that, or they assume it’s gonna happen later and they won’t invest in it. The point is if you can hit the right timing of it and you can start looking for great investments, you can make a lot of money.

So we started to invest in Intrexon, Intrexon-related deals, and in the process, we decided that there were a couple of indications that we could go after that no one else was really going after, and that we could fund and we could turn into real businesses. And so myself and two other guys we had this company called BioLife which became of the AveXis. We funded for $3 million, we went out for a couple million dollars, we got a license from Ohio State. We turned it into a real company, we hired real guys, we did real financing. But we put in $3 million, and we ended up selling it to Novartis this year for 9 billion. And that is for the treatment of spinal muscular atrophy.

Now we were up against Biogen, and Biogen’s partner Ionis and Biogen can create SMA but nowhere to level we can. We can do it with an IV. Ultimately with a pill probably, but we can do with an IV. And they have to do it seven lumbar punctures, and they don’t get the same results we do. So by using kind of like our contact base and putting together the right team, we were able to go build a company literally from scratch with no office, no employees. And in six years we sold it for $9 billion. We did it again, we did another company called Agilis and we did the same thing.

Now interesting enough, when we first formed AveXis, we first formed this company, we went to Intrexon and said, “Can you help us develop a drug for SMA?” And they said, “Yes” and we got a license from them. And then we determined within about six months that maybe there was an easier way to go and a faster way to go, and we were not wed to any particular company. And our CEO who’s a really… he’s a real bulldog down Ohio State, and he founded in an interesting way… we can go into if you want. But he founded and we licensed that for almost no money, it was a couple million dollars or maybe its two-and-a-half-million dollars. We paid for it.

And then we hired the right team, and we turned it into a real drug, and we treated 15 kids, and these kids are doing phenomenal. And we’re gonna treat other kids and then Novartis the bought it for 9 billion. But we started out by going to Intrexon. We built another company. There were three other people who started it up. I put the first dollars in it. Those three people are my personal friends, and they started it pretty much on the same way we started AveXis, in that, they went to Intrexon and said, “Do you have any rare orphan disease?”

Rare orphan disease for your listeners is that there aren’t a lot of people who have it, and it’s usually paediatric, so I’m not sure what the definition is. But let’s say 20,000 or 50,000 again, I forget the definition of people in the U.S. will have it. So it’s rare, “Was there another rare disease we could go after?” And Intrexon said, “You should go after FA.” And so we got a license for that, and then we built this company and decided that FA would take us too long. So we found another group in Taiwan, and we licensed a little drug for a central nervous system problem for a couple million dollars again.

And they had five years of data on kids and we took that great data to the FDA, and the FDA approved the drug with no clinical trials in the U.S. And we just sold that company to PTC for… I think their milestone we’re probably a minimum of 500 million, I think it’s closer to a 1.2 billion before royalties. But we started that, and I think we put a total of 20-something million in that. And so we’re constantly beating big pharma. The reason we’re beating big pharma is because we were early. See this is the beauty about being early because now if someone had a gene therapy program that was spectacular, you gotta really find it, and you gotta convinced them to let loose of it, or you’ve gotta convince them that you can build a great business team which our group can do.

Because you’re not gonna pick up some money for two-and-a-half million that’s gonna be worth a billion anymore because people are becoming a lot more sophisticated with the opportunities. But if you sat with big pharma three years ago, and you started talking about gene therapy, they had no one in the room who could talk about it, no one. If you talk with big pharma now, everybody in the room is trained in gene therapy. So if you get there early that really helps, so we’ve had two that were just gigantic returns. One is Novartis AveXis our costs was 64 cents, they got sold for $218 in cash. And then I think we’ll probably make 40-times on Agiles or something of the sort. And we have two more that are gonna be equally successful.

Meb: My problem was that I was way too early in gene therapy. I worked in a gene therapy lab in college and was absolutely atrocious at working in a lab. I’d spill viruses everywhere. That’s probably why I ended up in the investment space, but I can remember like it was yesterday reading Watson’s [inaudible 01:06:00] DNA book in college. I was in a Barnes and Noble, which listeners is a physical bookstore. I know most of you only buy books on Amazon now. But I remember finding that book and reading it cover to cover, standing in an aisle in Barnes and Noble for like three hours and becoming fascinated. And the thing for a lot of people is that you knew then even in late ’90s that a lot of the innovation was gonna end up taking 10, 20 years, but you’re finally starting to see a lot of the success, and it’s starting to get pretty exciting.

So as you spend your time like you’ve been doing, shorting, and private longs, and long investments, and VC-backed biotech, what’s kind of… as you look to the future, what do you think you spend most of your time in the coming years at the family office? Is it funding a lot of these innovative health care ideas? Is it something else? What’s on your brain as you look out to 2020s?

Tom: Okay, short, short-term and then a little bit further. Short term that we wanna have this company we’re invested in which will be our best thing BioSpherix I believe which is the original founder Chief Science Office of Celgene. And our BioSpherix has patents on drugs that we believe are significantly better than Celgene’s [inaudible 01:07:15]. And also we bought recently within BioSpherix an AML drug which was just mentioned in “Cell Magazine” where they believe that we actually have a cure for AML. And that would be amazing, and we will know as we treat a patient in probably in January how accurate that is. But I believe we have a company that actually could totally revolutionise Celgene on their [inaudible 00:07:41] which is their largest class of drugs and then offer a cure for AML.

If that’s the case, then this is a $50 billion company and our investment level is low. So we wanna get that to the point where that’s a total business and also a clinical success. The other thing is we’ve been doing a lot of work with another public company Ziopharm which is a totally misunderstood cancer company that trades about $3. Which I believe has the technology to completely jumps any other pharma company out there. I don’t care what anybody says. We can have 1,000 people get on the phone and tell me I’m wrong. I don’t think I’m wrong. And I think that if you’re gonna treat cancer you’ve gotta focus on solid tumours, and you’ve got to focus on fail to deliver, a drug to a patient in a timely basis at a reasonable cost, and that’s what Ziopharm does.

Ziopharm has the ability to do a generic delivery of a drug to a patient as opposed to the other current standard which is to deliver the drug by the use of a virus. So not to make it complicated for your listeners. You don’t wanna use a virus to deliver because it’s very customised to the individual. It’s a million bucks or $500,000 to do it. It’s a long time to develop it. There’s a big waiting list, and it is very dangerous. On the other hand, if you can do a non-bio application, you can go in your doctor’s office and what works for Bill works for Sally. And it can be produced in a low cost, and it isn’t nearly as toxic.

So I think we’ve been working a lot with Ziopharm, and I think that’s going to be… I never recommend to anybody that somebody should buy it, but we own in it and I think Ziopharm is a fabulous opportunity. As far as what we’re going to do in the future, I don’t have the slightest idea, like really at this point, I tell people they go “Well let’s see you did this company and that was that. You did that company and that was that. And biotech you’ve had two huge winners. You’re probably gonna have a third and a fourth. How you’re doing this?” And I kind of go, “Well, I don’t know maybe it’s just judgement, but maybe it’s just a lot of luck, and maybe it’s just being early.” And so I hadn’t figured out if we’re really good or really lucky, but people like to say you can’t do four in a row and just be lucky, right.

We’re gonna continue on this, but I would like to find some other indications that we can have a revolutionary change in a product that obsoletes the other products. So I wanna be the guy even though I’m not doing it, I wanna be the guy that has the Rogaine killer. So a guy takes a pill and grows all his hair back okay. I wanna do that because there’s so many… if you can name it, whether it’s fabric or whether it’s something you eat, or whether something you wear, or anything. If you look around your environment, every single thing in your environment can be improved with better DNA.

So that gives every opportunity. So if you can think about it whether it’s a synthetic leather, or whether it’s a heating fuel, or a fuel that goes in a car, or a cosmetic, or teeth whitener, or any of these other things, these are great opportunities. Let me tell you what is not a great opportunity which I hate relative to the DNA this whole industry. And that is making humans into robots, and this has been a thing which has scared everybody and it scares me today. I’m not gonna get involved in that aspect of going into embryos and making changes.

Now, I’m all for going into and being able to figure out if there are genes that this person is gonna have that are going to cause major diseases and the like, and making those kind of corrections. I am not for going in and deciding that they can be 6’2 instead of 6’8 that they can have an IQ of x, that they can have this or that, because I don’t particularly like that. But there are literally thousands of industry opportunities, and so I’m gonna continue to look for those, and I’m gonna try to get lucky and do some things on the public side.

Look recently… and I’ll tell you what your listeners can look for. Let me go back. We’ve owned some of these companies for five years before they worked, when they worked they were crazy okay. But yes, five years, sometimes of a little agony, and sometimes just how long is this gonna take, and it needs a little bit more money. Even if it’s just a little bit more money. Some of these things take a long time. But if your listeners can understand this, there can be a major change that obsoletes something else. And when that happens, if you can see that in the marketplace even after it’s announced, you can still make a fortune doing it even though you missed the first move.

So we finally bought the other day symbol AMRN, Amarin, and I have a friend who’s owned it for eight years, and it was because it would come out with some results on their drug where they treat about 8,000 patients to find out what it did for heart attacks. Just to make it simple because I know you like to make it simple, and the street thought that it may reduce heart attacks by 10 to 15%, it turned out it was 25%. So the stock was $3, it had a chance to get to about 50 if the results were poor. The results were great. It was $3, this is like a week and a half ago, it’s $20 today, it may be 18 right now okay.

It was $20 this morning. I owned it one day and it took off the next. After it took off, I bought a much, much larger position because they had not priced in, people going “Well I can’t buy stock that goes from 3 to 10,” I’m going yeah you can because it’s not the same company anymore.

Meb: That’s actually an interesting point. I mean I remember there was an old-school biotech book, I wanna say it’s called “From Alchemy To IPO.” And I’d love listeners if you have any updated studies on this, send them in. But there was a study where you basically bought biotech stocks post announcement. Meaning the news already came in but there was a behavioural under-reaction. Meaning it did pop, in this case, it was a huge pop. But even then, the market was underpricing the potential good news. I would love to see an updated study if any listeners have one send something over.

Tom: Well, I’ll tell you this, I would not advise people buying these… any company whether it’s biotech or not where they’re talking about something a year, or two, or three years down the road. Because it’s too damn hard to do it, and you just gotta hope that all of a sudden somebody decides to jam the stock up, and you sit there and you miss a great market right. I mean I’m at fault for owning Ziopharm instead of owning Juno and Kite. But I don’t believe in Juno and Kite even though they got bought out for a fortune, I don’t think they’re gonna work, and I don’t think they’re gonna be long-term businesses. But maybe they are gonna be a long-term businesses, or maybe these big pharmas wanted to buy them because they have a certain level of technology they can morph into another technology. I don’t know what they’re thinking, I didn’t wanna buy them.

So I own Ziopharm that’s been a $4 stock as long as you and I can remember okay. I mean this is a four-year sitting on our hands, but timing is now. And so if I was smarter I would just wait until they had an announcement or two and the stock went to eight or nine and then I could buy it, and I wouldn’t have to think about it. So the great opportunity for your listeners is that when you see these companies have a product transition, it’s not the same company as it was the day before, it’s not. It was a $3 stock because it deserved to be a $3 stock, but you can just look at it this way, if it was $3 and they didn’t know whether you were going to cure cancer, and the next day they cured cancer, it ain’t gonna trade for $3 anymore.

So you know, what generally happens if you do get this lift, and then you get the next opportunity because people can’t pay up when it was three then it’s nine, they can’t do it, okay. But then you find out days later that it was x, y, z, and days later it’s up another two times or three times. Look what happened on AveXis, AveXis had great news. We owned this thing forever. I mean five years before we get bought out. But it goes from a $3 million market cap, to a $4.5 billion market cap. Now here’s the hard part, in one day it went from a 4.5 billion to a 9 in one day. And so you don’t have to be early, but it is nice to buy it right, but you can take the latest data and you can apply it to the price.

Look they screwed up Apple all the time about that. You get all these clowns on TV going well Apple I don’t think this or that. At one time Apple by the time you subtract your cash, what was it three years ago, it’s trading for three times earnings. And people are debating whether it was something you should buy or not. Are you kidding? You know, sometimes you’ve got to look at the latest data, and the opportunity is really ahead of you. So I don’t know, I hope I just continue to be this lucky.

Meb: That’s the best advice. I love that, to all our listeners just get lucky that’s…

Tom: I wanna add one thing because if somebody said, “What is the most important thing you do?” I’ll tell you what it is, and that is this, and I learned this long time ago, it’s a very simple lesson. Was I was shorting stocks and they broke up AT&T. Now if people don’t probably know that it was AT&T then they broke it up into the Southeastern Bell, Southwest Bell, Pacific Bell, they broke it up, right. And when they broke up AT&T into the Bell companies, all these long distance discount carriers popped up. They popped up everywhere and they… all had big market caps and they all claim that they were going to be able to sell long distance discount because they were gonna buy it in bulk and they were gonna sell it out individually. And you’re gonna save all this money.

So they were going to put all the Bell companies out of business, no one would go long distance. I know it’s crazy that people used to pay for long distance calls, but listeners, we used to have to pay for long distance calls okay. So I wanted to short some of these companies because I knew that it wasn’t gonna work. I could not get the answer, no one could get the answer. So for us, that were around back then we know that there was one guy who broke up AT&T and he caught a lot of crap about it the guy was Judge Greene. And Judge Greene solely broke it up and wrote all the opinions on it.

So I’m sitting there going well how am I gonna figure this thing out? And I decide I’m gonna call Judge Greene. I don’t know I was 30-something at the time right. I picked up the phone, find out where he is, call. They switch me to him. He goes, “Hi Judge Greene.” and I’m going, “Hey, I actually got Judge Greene on the phone right.” And I talked to Judge Greene I said, “Explain to me this, can they do this? Can they do this?” “No, they can’t do that.” “Well, this guy said they can do that.” “No, they can’t do that.” “How about this guy?” “No, they can’t do that.”

The point of the matter is I didn’t go to an analyst on Wall Street to get his opinion, I went to the single best guy in the world. Now if you can find a single best guy in the world, which you can always, and they will talk to you, and they will always talk to you, you can always get the answer.

Meb: I think that’s a great piece of advice because most people are… I don’t know if lazy is the right word or scared. But most people will never make that call right because they’ll say… I can’t tell you how many times we chat with people they say “Well I emailed him. He never responded.” I say, “Well pick up the phone. You never know right.” But there’s the old cynical quote thinking about luck. I think it’s like “Luck is what happens when preparation meets opportunity.”

Tom: Sometimes you gotta to be willing to call the guy 20 times, and eventually they’ll put you through just to get rid of you, it’s weird.

Meb: You don’t call 200 hospitals, you’ll never find all the lasers in the basement.

Tom: Well, that’s true. Now I have access to those kind of people because I know how to get to them. I can understand why people who have full daytime jobs don’t have access to do it. But what they’ll do is, they’ll sub in other guys experts. So I actually like Jim Cramer, but I don’t invest in his style, but if Jim Cramer’s now my expert, I probably got a problem right. The investing public will find who they think their expert is, who’s easy to get, then they’ll tune in to hopefully if they want the real experts, they’ll just come to your podcast right.

But you know, otherwise, they’re gonna go to CNBC or they’re gonna go to Maria Bartiromo or people that are really smart, but they’re not experts right, they’re just reporters. And they believe well this guy said this and that, can’t do that. You can do it with small amounts of money, but you can’t do it with big amounts of money, and I wouldn’t do with any money. And I think that’s probably the biggest difference between us and anyone else. We will find the single best and keep working until we find that. And not based upon somebody’s opinion, but actually, there’s always one guy who’s a single best.

Meb: Tom, you’ve had a pretty amazing career, different cycles, different investments, different styles. We always start to wind down the interviews asking our guests one question which is… and we may have talked about already, what has been your most memorable investment or trade? Can be anything, it could be good it can be something you had a terrible outcome. What’s the one that really sticks out in your head as just burned, seared into your memory as the most memorable one in your career?

Tom: Well, actually I was on the streets of Florence, Italy at the time it happened. We were following this company which I would prefer not to mention that… and they’ve gotten in a lot of trouble as of the last year or so, and their stock has collapsed. But we always felt like there was no way that insurance companies were going to continue to reimburse for this, we never thought so. Because the pill was no better they were charging like $25,000 a pill, it ultimately turned out to be about 250,000 a year for something that you could take a steroid pack which is $10.

So we kept waiting for the company to have insurance companies drop them because you know, why would insurance companies reimburse for this? Because it’s totally stupid, it was off-label, so in just searching the Internet, one of my analysts call me… no, it was my brother Joe, he called he says “You’re not gonna believe this, Aetna dropped them.” I said, “Aetna dropped them?” He said, “Yeah, Aetna dropped them.” It was an hour left trading in the day. I said, “Well if Aetna dropped them, it’s on the Internet?” They go “Yeah, they put on the Internet,” Aetna did, right. And so we went out and we bought every put we could possibly buy, it was like $70 or $80 at a time. Every single put we could find because this is all we were waiting for.

At the end of the day, I think we put up maybe… all would could buy was like 100-something thousand dollars worth. That’s all we could do, because we’d literally 20 minutes to go. This is like six years ago. The next day, market opened and they said… now news was everywhere that Aetna had dropped them, and stock plummeted, and we sold those puts. And I think we turned it into 13 million. But you know what it was? We were just looking to find out. Now had I been in the U.S. I’d got off more than 100-something thousand dollars worth. I’d figured out how to do it because it was obvious it was gonna get crushed, but it was just a public site.

And I remember my trader at Goldman called me he said, “Barton,” he says “The SEC is gonna be in here, you can’t do that.” I said, “Let them come in. I read it on the Internet. You kidding? It’s on the Internet. It’s on their website.” So to me that the craziest one, and one that I smile about the most today because it was such a pain in the butt. That company, it was such a pain in the butt, but we just kept waiting we just got it right off the Internet and no one had seen it.

Meb: It was like waiting Christmas Eve waiting on that announcement. Tom, this has been a blast, it’s been a lot of fun. If people wanted to and I don’t know if… you don’t really do a lot of public writing or anything else, is there a way for people to track what you’re up to these days or is that impossible?

Tom: So far the best way to track what I’m doing is to listen to your podcast because I don’t really go out and tell stories too much. But I’m gonna lift my profile slightly because even though we have plenty of capital, it seems like we always have more ideas in capital. So I’m not out raising capital but I do talk from time to time to different people. So I thought it would be better at this point to raise my profile just a little bit since I’ve been underground for so long. And I think it’s also gonna help me get some new ideas, so they may see me a little bit more. But you know, generally speaking, we’re pretty private.

Meb: Tom, it’s been a blast thanks for taking the time today.

Tom: Sure, thank you, take care.

Meb: Listeners we’ll post show notes, links to a lot of this fun stuff. Maybe we’ll convince Tom to publish his old short selling book. And it’s been a lot of fun. Well, check out the podcast archives mebfaber.com/podcast. Leave us a review if you like the show if you hate it, let us know. And send and Jeff some questions [email protected]. Thanks for listening friends and good investing.

Source: https://mebfaber.com/2018/10/10/episode-125-tom-barton-the-biggest-problem-investors-have-is-things-changeand-they-dont-change/

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