The modern teenage boy

In his 2001 book Next, Michael Lewis tells the story of a then 15 year old named Jonathan Lebed who managed to make hundreds of thousands of dollars by buying stocks, promoting the stocks on Yahoo! message boards, and then selling them when the price went up. In the process, he attracted the ire of the SEC, who couldn't quite explain how what he was doing was different from any other type of "market manipulation" that CNN analysts or businesses themselves do. (The story was also covered by 60 Minutes back in 2000.)

I found the story interesting, but for me the greatest sources of pleasure from the book were Lewis's characterizations of Lebed, such as this one:

He habitually dramatized or understated his case, and when he did, emitted a strange frequency, like a boy not quite sure how to blow into his new tuba.

I can relate. So, too, can probably many adolescent boys.

Then there's this:

His mind was a peculiar combination of grandiosity and myopia. When he stared into his computer screen he saw the depths of the universe; when he looked up from it he was hardly able to see beyond Cedar Grove. From the moment he became a celebrity in town, he attended meetings of the Town Council, where he’d become a kind of freelance civic activist. He could imagine entering politics but couldn’t imagine much beyond mayor of Cedar Grove, New Jersey. When I asked him where he was thinking about applying to college, he couldn’t think much past Montclair, New Jersey. He had no more ability than I had to link his Internet self with his real-world one. He could imagine himself doing great things, but these great things always took place within a few hundred yards of where he happened to be standing—except when he was on the Internet.

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I was curious to find out what Leded is up to 10 years later. Interesting to find that he's still promoting stocks -- selling himself as a "stock picking prodigy" -- with a website and video and email newsletter.

I subscribed to his newsletter because I want to see what he's learned about persuasive writing after many years of practice. Discouragingly, he seems to favor the all-caps-plus-exclamation-points method.

Just so that you don't blame me if you make a large bet on RA and lose, I actually will make a target price for RA, my target price is $0! Let me repeat, my target price for RA is ZERO!

You can view writing samples under the "market blog" section of his website. I imagine this is the type of writing we would see from someone who quit their job on the Home Shopping Network and started writing a blog on RARE EARTH METALS -- STOCKS TO WATCH!!!


Somewhat related, Jason Fried writes about how he got good at making money: (hat tip: Kottke)

So here's a great way to practice making money: Buy and sell the same thing over and over on Craigslist or eBay. Seriously.

Go buy something on Craigslist or eBay. Find something that's a bit of a commodity, so you know there's always plenty of supply and demand. An iPod is a good test. Buy it, and then immediately resell it. Then buy it again. Each time, try selling it for more than you paid for it. See how far you can push it. See how much profit you can make off 10 transactions.

Start tweaking the headline. Then start fiddling with the product description. Vary the photographs. Take some pictures of the thing for sale; use other photos with other items, or people, in them. Shoot really high-quality shots, and also post crappy ones from your cell-phone camera. Try every variation you can think of.

To me this quote smacks of the same peculiar combination of grandiosity and myopia that Lewis described, and that combination seems to describe many entrepreneurs. Even so, I like the idea as a way to explore human psychology, albeit a fairly narrow range of it.