Come Watch the Sausage As It’s Being Made

The Washington Post has published an online piece by Abha Bhattarai, who tells me that it (or, I sense, a longer piece) will be appearing in the print edition this coming Sunday. This alignment gives us a unique moment to permit you, the public, to watch the MSM sausage being made. It will give us a view into the intellectual honesty of the Washington Post, where ‘Democracy Dies in Darkness”: I remain hopeful that this little experiment will reflect well on them and Abha.

I am going to take her online piece, and insert into it some comments, facts, and data. This will give them time to do with it as they will between now and the print edition appearing on Sunday. That way, the public will have a first hand view into the process by which the Post (“Where Democracy Dies in Darkness”) manufactures its sausage, and the public can judge that process for itself directly.

I would like to note that when Abha contacted me to do this piece, I asked that we keep everything to email only. However, after many dozens of emails and some degree of trust had been established, we did have one (and, I believe, only one) phone call of ≈ 45 minutes (NB this is an estimate only, and for me it was from the other side of the world under unusual circumstances, so this estimate could be off in either direction). Thus, there is an email record of the vast bulk of our communication that supported this article.

In our phone call Abha sometimes made sure I knew she was giggling with disbelief (though would provide no indication regarding any specifics as to what she was doubting, or why, though I enquired). That is OK: I have always understood that my life would strike most people as barely credible at best, and in addition,  such is frequently the habit of millennials (I believe Abha is under 30). Other than that, I found Abha professional, courteous, and, and intelligent. She also was willing to do actual research, both at my request and on her own, which puts her head-and-shoulders above most journalists. Moreover, she is unusual in that she is generally willing to communicate my claims honestly, which also puts her head and shoulders above most (but not all) journalists I have known since the Establishment and I got at cross-purposes about 15 years ago. She may describe them as improbable, but as you will see, for the most part she has represented them fairly. I will call out extensively an important area she skews them, however.

Best of all, you, the public, are going to be able not only to view the sausage being made, you are going to have a chance to vote on your thoughts after Sunday’s article is presented.

With that preface, I now reproduce her article, will my comments inserted in bold italics.

——————————————————————————————————————————————————–

Insurers worried the retailer could not rein in Patrick Byrne’s personality and public comments. So, he says, he had no choice but to leave. Note the “he says”. I supplied Abha emails both from our then-CFO, and from the insurance brokerage, Marsh, that make clear it was “impossible” for us to get insurance at any price. “Not a question of price, a question of coverage” as one of those emails puts it. I would say that is tantamount to having “no choice”: one cannot expect directors and officers to work for a firm without being personally insured (and try recruiting any who would). Abha knows all this and possesses those emails.

Patrick Byrne, who led Overstock for 20 years, resigned last month after saying he’d become entangled with the FBI’s “Russia investigation.” (Steven Ferdman/Getty Images)

By Abha Bhattarai

September 26 at 7:14 AM

At Overstock.com’s 20th-anniversary party last month, employees played tug-of-war, munched on artisan pickles and scrambled through an inflatable obstacle course at the company’s headquarters near Salt Lake City. It was a celebratory affair, complete with a reggae band, but for founder and chief executive Patrick Byrne, it held a tinge of melancholy.

He was about to resign, and not exactly by choice.

The retailer’s chief financial officer had just informed the board of directors that Overstock could not renew its insurance policy as long as Byrne was in charge. The CEO’s incessant broadcasting of his involvement in a “deep state” investigation  That is one way to put it. Here is another way: Byrne says he came forward because he felt a civic duty to expose the truth to the public. Why spin that as, “incessant broadcasting”: When  the Washington Post tries to expose some mischief to the public, is it “incessantly broadcasting” something, or just “doing the right thing”?

had irreparably linked his personal life with the public company. On Overstock letterhead the week before, he claimed that he had romanced a Russian agent at the urging of the “Men in Black” — his term for federal agents — and effectively inserted himself into an international political scandal.

Now Overstock’s insurance provider had concerns about the company’s ability to “manage the CEO’s personality and public comments,” according to internal emails obtained by The Washington Post.

In his Aug. 22 resignation letter, dated two days after the anniversary party, Byrne said he’d become ensnared in “certain government matters” and that his “rabbi,” Warren Buffett, had advised him to come clean to the American people. Later that day, Byrne appeared on Fox Business wearing a “Make America Grateful Again” hat With a Grateful Dead “Stealy” skullface on it: Abha is to be forgiven for not making the connection, given her youth.

and claimed a federal agent had offered him $1 billion to keep quiet.

But he was obligated to come forward because, he told Fox, “This country’s gone nuts.” That is correct. Now as an Asperger’s, I have trouble detecting sarcasm. Let me know in the comments below: is she being straightforward here, or being snarky? Let me know.

Byrne’s resignation capped an unconventional and controversial two-decade run at Overstock.com, a billion-dollar retailer best known for moderately priced home goods. But the company that revolutionized furniture-buying to become one of the biggest successes in e-commerce was now reeling from a series of missteps and diversions, leaving it with hundreds of millions of dollars in annual losses. She left something out. Here is Overstock Retails annual GAAP profitability 2009-2016, a B2Cecommerce record that is essentially unmatched, I believe.

In 2017 I informed the public that due to Wayfair’s emergence, and the capital market’s apparent willingness to subsidize endless losses endlessly, that I was going to hit the throttle, accelerate, and take Retail’s losses to somewhat over $100 million while accelerating (I also said that for one year we were also going to sink a similar amount of capital supporting ≈ 20 blockchain ventures). My hope was that by doing so we might start getting the strange (and to this value-investor, counterintuitive) valuations of other Internet firms. I did hit the afterburner, we did around 20% growth, we did lose just what I said we were going to lose (see graphic below illustrating our history of profitability next to Wayfair’s, and what happened when we hitn those afterburners.. Yet the market did not give a damn at all. Our valuation did not budge. So at that point I killed the afterburner. On the blockchain side, we sank just what we said we were going to synch into supporting those ventures. So I announced beforehand what we were going to do, we did it. The capital market yawned. Abha calls that “a series of missteps and diversions”. Well, was it a misstep to see if the market would value is at something other than .15 X sales, and see if we could get something closer to the 2-4X sales valuations that enjoyed by competitors who cannot even dream of having a string of profitable years such as we show above? Could be: it did not work, that’s true: the capital market did not care. But is it correct to call that a “misstep”? It seems to me we stepped just where we said we were going to step. The market did not care, but we did step where we said we would step. Is funding the blockchain revolution actually a “diversion”? Time will tell.

The company’s flagship site had become an afterthought for Byrne, 56, who wanted desperately to sell it to focus on his cryptocurrency businesses. This is 2/3 false. Retail had not become an afterthought. How might you know? I said that in 2019, by reversing course and jettisoning the Wayfair strategy depicted above, Retail’s bottom line would improve >  $100 million in 2019. And it looks well on track to do that. Such improvement is not often normally a sign of something being “an afterthought”.

But perhaps the biggest bombshell was Byrne’s claims of entanglement with the FBI. In a corporate news release last month, Byrne said he had been assisting federal agents in their investigation of Russian election interference through his three-year relationship with Maria Butina, the accused Russian agent.

Overstock shares fell 36 percent within days of the news release as anxious investors absorbed Byrne’s accounts of political intrigue, espionage and, in his words, a “handful of trysts” with Butina. The board was losing patience, and its chair, Allison Abraham, had begun forwarding hate mail to him, he said. Abraham did not respond to a request for comment.

Soon Overstock’s insurance carrier was expressing reservations about renewing its liability plan for directors and officers, a scenario that corporate insurance experts say is highly unusual.

“I’ve heard of companies that are too toxic to touch, but for one individual to be a liability risk for the whole company? That’s pretty extraordinary,” said Dan Bailey, an Ohio-based lawyer who has been drafting such policies for more than 30 years. “I don’t think I’ve ever seen that before.”

Internally, executives explored whether they could get a policy that covered all directors and officers except Byrne. When it became clear they couldn’t, Byrne says, he knew it was time to walk away.

“I figured that when one is having to parse finely what ‘impossible’ means when it comes to getting insurance, it was time to leave,” said Byrne, who spoke to The Post by phone and through more than 80 emails over three weeks.

***

Overstock was designed to keep its shoppers guessing.

The site began as an online flea market where wholesalers could offload just about anything, including exercise machines, bedsheets and Star Wars figurines.

The company got its start in 1999, at the height of the dot-com boom, when Byrne took a $7 million stake in D2: Discounts Direct, an online outlet for excess inventory and relaunched it under the new banner. It grew rapidly: Annual revenue catapulted from $1.8 million in 1999 to $25.5 million in 2000. By 2002, the company saw $92 million in revenue and turned its first quarterly profit. Props to Abha for noting that. For 15 years, not one journalist has done the research or had the courage simply to note that simple fact. It is interesting to me that in her emails to me she noted the striking exceptionality of this fact. She even calculated the amount of capital it took for Overstock to reach a profitable quarter versus the extraordinary amount taken by others: I think (and can dig up the meial if challenged) her calculation was $52 million for us, and nearly $3 billion for another large eCommerce player (with which readers would be familiar) before reaching one profitable quarter. However, her calculation and comparison of us with this other company has been omitted from this article. Odd, that. 

“In many ways, Overstock revolutionized e-commerce,” said Stormy Simon, who started working for the company in 2001 and was its president from 2013 to 2016. “We were the first to ship couches and huge rugs across the country. There wasn’t a lot of competition — it was just us, Amazon and eBay.”

Many of the company’s early practices have become standard in online shopping. Overstock was a pioneer in “drop shipping,” in which companies cut out the middleman by allowing third-party vendors to ship directly to customers. Meanwhile, its Club O membership program — introduced in 2004, a year before Amazon Prime — allowed shoppers to pay a flat fee for a year’s worth of free shipping. (Jeff Bezos, the founder and chief executive of Amazon, owns The Post.) Credit to Abha for noting these, and for the Post o publish them, all things considered.

By the mid-2000s, though, new competitors emerged. Overstock moved to improve efficiency and invested heavily in updating its computer systems. But it ended 2005 with $25 million in the red. A year later, losses widened to $97 million.

Its stock also was in free fall, shedding about 80 percent of its value from 2005 to 2007. Byrne attributed that decline to systematic problems on Wall Street, including naked short-selling, in which investors bet against a company’s stock without having borrowed shares.  Through the entire range of years Abha cites, and one more year beyond, Overstock was on the SEC’s Reg SHO Threshold List, a list of companies seeing excessive  failures to deliver in their stock, which is how markets are manipulated. That is not my opinion, read this string of articles from 2008 when regulators across the world figured it out as well, and admitted it publicly. That whole argument got more than settled over a decade ago.

It was all part of a wide-ranging Wall Street scheme, he told investors in a 2005 conference call, that involved “miscreant” hedge funds, high-profile journalists and the SEC. He claimed someone called “the Easter Bunny” had clued him in on the conspiracy, and that it was being overseen by a “Sith Lord,” a reference to a Star Wars villain. (In later interviews, he compared the network of “miscreants” to al-Qaeda.) Abha left out some important facts here: I made clear in those interviews that the Sith Lord to whom I was referring was Stevie Cohen. Several years later, the United States Government forced Cohen had to pay a a $1.8 billion fine and commit to not touching the public markets for several years. The comparison with Al Queda was, I explicitly said at the time, in organizational structure: a band of fellow travelers rather than a top-down hierarchy. It is called a “metaphor”. Oh, exactly as proved to be the case regarding Cohen’s SAC and a strong of about 15 hedge funds, many of which (e.g., Diamondback) had spun out of Cohen’s organization. “Easter Bunny”:  yes, the source did not want me to know his real name. Abha, have you ever worked with a source who would give you clues to hunt but not tell you his real name, and used only a fake one like “Barney Rubble”? Most journalists I know have.

Although the comments raised eyebrows, the company’s board made no public effort to rein him in.

“I listened to that conference call with my jaw on the floor,” said a former executive who spoke on the condition of anonymity to discuss internal affairs. “But of course nobody pushed back. Everyone was working for Patrick. It was his company, and that was it.”

Byrne became more outspoken over time and sought a bigger platform. He started a website, DeepCapture.com, where he laid out his views Propos to Abha for mention this, the site that dares not speak its name. Well, MSM normally dares not speak its name, anyway.  She might also have noted that in 2008 and 2009 in Intternet-wide polls it was voted the best Business Investigative Journalism and the best website to learn about Corruption in America

and frequently took aim at former colleagues, journalists and hedge fund managers. (In a recent high-profile libel suit, a Canadian judge ordered Byrne and his site to pay nearly $1 million to a Vancouver businessman after DeepCapture accused him of being an arms dealer and terrorist.) Abha may have noted that the man in question ran the largest boiler-room in the world (i.e., “Wolf of Wall Street” type operation). And that it was owned by BCCI, which collapsed in a gigantic banking scandal around the year you were born. What caused its collapse? It turned out to be the bank of choice for arms dealers and terrorists (e.g., Carlos the Jackal, Columbian narcoterrorists, etc.)

But the campaign also drove his billionaire father, John Byrne, to resign from Overstock’s board. The man widely credited with rescuing Geico from bankruptcy in the 1970s said at the time that he disagreed with his son’s “jihad” against Wall Street. (He rejoined the board four years later, saying his son had been “right all along.”) Fair of Abha to note. Most journalists do not have the intergrity to note that second part.

Yet  this is where I believe Abha has slipped into being less than intellectually honest (though the fault is likely her editors’), as she knows that DeepCapture was not about “taking aim” at journalists or hedge funds. It was a frequent refrain of mine during those years that my fight with Wall Street was not about me or Overstock, it was because I knew the system was going to collapse.  Plese see these 6 points.

1. The original DeepCapture speech in front of 1,000 hedge funds that set the thing off, where near the end I say precisely that. After laying out the whole theory for 40 minutes, I said: You’ll note that there is a word you have not hear dme use. You have not heard “Overstock”. This fight is not about me, or my company. I’m doing it because think the market is going to meltdown.
2. In the one page introduction on DeepCapture.com, I culminate my three warnings with these words Chapter 7 – Unsettled Trades & Systemic Risk: A third side effect of this crime is that it has created in our country’s financial system a crack so deep it could trigger a systemic collapse.
3. Here is a 3 minute montage of clips (“Economic Warnigns from Patrick Byrne”) from 2005-2008 where I note that the settlement system had slop that was going to crater the financial system, and that this was not about me or Overstock..
4. On October 23, 2008, Greenspan went before Congress and attribute the meltdown to the “settlement” system. He might as well have said (as my Pop eventually did), “Patrick Byrne was right all along.”
5. Noted (and generally excellent) financial journalist Charlie Gasparino later said in a book in 2008 and on CNBC, “Patrick Byrne was right all along…That guy that that everybody made fun of…”
6. Please scan through the 20+ articles excerpted here from 2008: “Do I Live in a Synthetic Reality?” Do-It-Yourself Home Test  which document how the regulators of the USA and the G-20 became adherents of the theory that I had been espousing for 4 years.
7. At the end of 2008 (a special year in the history of Wall Street), the Wall Street Journal published this story: “2008 Lookback: Best Calls of the Year”. In it they listed 5 people who had called it right. There, after Nassim Taleb and Nouriel Roubini, was #5:
   • “Patrick Byrne Gets His Due. The quixotic chairman of Overstock.com, one of the more colorful chief executives around, has been pounding the table on naked short-selling for years. This year, the Securities and Exchange Commission finally looked into it and issued stringent rulings. Now, it wasn’t enough that a brokerage shorting a stock knew of the availability of shares to be borrowed – they had to deliver them on time as well, and if they didn’t, they’d be barred from engaging in another short-sale unless the shares had been borrowed already. Of course, Mr. Byrne’s company’s stock still fell 25% on the year, but never mind.”

Simply so there is no question, I will post this fact about Greenspan again:

Yet, it is verboten, absolutely verboten, to acknowledge that the focus of DeepCapture was the systemic risk posed by our sloppy settlement system and that this turned out to be incredibly prescient. Yet before the collapse of 2008 no one would ever mention this claim, no matter how many times I said publicly words to the effect: Forget me, forget Overstock, this is about a collapse of the financial system (watch those three minutes of clips again). After the collapse, with exceptions such as I noted above, it became even more verboten. Why is that? It is because by ignoring or distorting my message for those three years, the Establishment media , the Establishment was sliding their car keys into a game of poker. They violated all norms of journalist ethics in how they came after me, so confident were they that I was wrong and they would never be shown up. They bet their credibility, and they lost it to me. That is why it is the subject which dares not be mentioend.

Incidentally, Abha has all of the above links, and has had them for a week or more. It was one of the main things we explicitly discussed on the phone. She is now fully aware that she has misrepresented DeepCapture by omitting what it was really all about in the days leading up to 2008, said over and over and over again with 100% clarity. At the time, the media refused to report that this is what I was saying, instead choosing to portray it as some tiff between me and some journalists and hedge funds. It is good to know that even today, 11 years later, the MSM media is again afraid to acknowledge that simple truth. The significance is too enormous.

But this time, you the reader can join in my wonder at this fact. Because the Post is going to publish this story (or a related version of this) in its print version on Sunday. So I invite you to join the party. Please familiarize yourself with the 7 links above. Then write Abha (her email is public: [email protected]). I suggest you tell her that you have reviewed the 7 links above, and are curious to see if she will remain with her distorted description of DeepCapture for her print article, and why is it that the Washington Post (where “Democracy Dies in Darkness”), is still, 11 years after the fact, reluctant to convey the truth about this?

“It became all about, ‘I’m going to take down Wall Street,’ and that became more important than the business,” said Simon, the former president. “Patrick just didn’t love retail after that.”

I am sad to learn that Stormy feels this way.

In 2007, Byrne sued nearly a dozen major Wall Street banks, including Goldman Sachs and Morgan Stanley, for $3.5 billion, alleging that a “massive, illegal stock market manipulation scheme” had driven down Overstock’s share price. Several of the banks settled out of court in 2010, for a collective $4.4 million. Merrill Lynch’s case extended into 2016, when it agreed to a $20 million settlement. (He also collected a $5 million settlement from Rocker Partners, a hedge fund he claimed was manipulating the company’s stock.)

“The lawsuits ended successfully,” a spokesman for Overstock said. “And the regulatory changes advocated by Overstock lessened the debilitating consequences of the 2008 financial crisis to some of the largest banks in this county.” That same year, the Securities and Exchange Commission banned “abusive naked short selling.”

Byrne said he personally bankrolled the $30 million for his “mitzvah with Wall Street,” which former employees say began taking priority over the company. “The oligarchy picked a fight; I clubbed them like a little baby seal,” he said in an email. “It was an honor to be able to put that wealth to such good purpose.”

Byrne’s deep distrust of Wall Street lingered. Until a few years ago, the company kept $10 million in gold and silver coins, along with enough food to feed its employees for three months (the stockpile is now down to a few weeks). “Why? To make our firm robust in the face of a number of social ills that could beset our nation,” Byrne said in an email to The Post.

The company also invested heavily in blockchain, the technology behind digital cryptocurrencies. It began accepting bitcoin in 2014, making it the first mainstream retailer to do so, and has continued to pour hundreds of millions of dollars into Medici Ventures, its blockchain investment business, and tZero, its trading platform for digital coins. (That part of the business has been the subject of a years-long investigation by the SEC, though executives have said there has been no indication the agency plans to pursue legal action. The SEC declined to comment.)

Byrne has long confounded those around him. He has a doctorate in philosophy from Stanford University and a black belt in taekwondo. Much of his world view, he has said, was shaped by three bouts with cancer, starting with a diagnosis of testicular cancer in his early 20s.

Internally, Byrne was known for having grandiose plans and a short attention span, according to interviews with former employees and executives, and one former board member who spoke on the condition of anonymity to discuss the company candidly. Byrne relied heavily on an insular group of executives who referred to themselves as “coyotes” and rarely challenged his views, several of them said.

Byrne left his mark on every part of the company: Its newest headquarters was designed to look like a peace sign from above, and like a “corporate version” of the Roman Colosseum from ground level, according to a company release. He also helped create an internal voting system that allowed employees to weigh in on company decisions, such as whether Snoop Dogg should perform at the office or who should be fired. And more importantly, things like organization our product road maps and strategic prioritities. This is another point Abha knows but has curiosly omitted.

In recent years, Byrne had been trying to sell Overstock’s retail business, setting up meetings with Walmart, Target, Home Depot and the furniture rental company Aaron’s, according to a person involved in the discussions who spoke on the condition of anonymity because the talks were not public. Representatives for the four retailers declined to comment, as did Overstock. As do I.

Byrne said he had hoped to sell the retail business in an auction scheduled for March 8, 2018. But days earlier, the company disclosed that the SEC was investigating its blockchain business. Almost immediately, “everybody backed out,” Byrne said, and the company was forced to put its plans on hold. Overstock has yet to find a buyer.

Meanwhile, Byrne doubled down on bitcoin, pouring his ambitions and money into blockchain technology and start-ups — which is what led him to Maria Butina.

***

Their story began at Planet Hollywood in Las Vegas.

It was 2015, and Byrne had just given a speech about cryptocurrency at FreedomFest, an annual meeting of libertarians that attracted such speakers as Donald Trump, Steve Forbes and Peter Thiel. He said he quickly noticed a “striking redheaded young woman” waiting to speak with him.

Butina introduced herself as the president of a gun rights group in Russia and handed him her business card, Byrne wrote on DeepCapture.com. The next day, she approached him again, with a different card. This one identified her as a special assistant to the vice chairman of the Central Bank of Russia. “Dr. Byrne, please allow me to tell you why I am really here,” she said, according to Byrne. “I have been sent here to make contact with you.”

Butina’s attorney, Robert Driscoll, disputes Byrne’s version of events: “She wasn’t sent to the U.S. by anybody, and she certainly wasn’t sent to the U.S. to make contact with Patrick,” he said, though he confirmed that the two had a romantic relationship.

Byrne invited Butina to his hotel suite for a lunch meeting. Butina told him she was being groomed to become the next president of Russia, Byrne said, and invited him to Moscow to speak about bitcoin at the Russian Central Bank.

Byrne said he then contacted federal authorities and asked whether it would be okay to accept Butina’s invitation to Russia. It took weeks, he said, to get an answer but eventually he received a “green light” telling him to move forward. He had no expectation that their relationship would turn romantic, but Butina “swept me and my liberalism off my feet,” he wrote on Deep Capture. A spokeswoman for the FBI declined to comment.

He said they spent a weekend together in New York, then met up every so often in different parts of the country. It reminded him of “Lost in Translation,” he said, referring to the 2003 film in which an aging actor played by Bill Murray and a recent college graduate played by Scarlett Johansson have a series of intimate meetings.

“We had a handful of trysts like that,” he told The Post in an email, “spread across time, in the background of the normal narrative arc of her life.”

In late 2015, he said, Butina told him she’d been given orders to make contact with the presidential campaigns of Hillary Clinton, Donald Trump, Marco Rubio and Ted Cruz. The specific order Maria always spike the names in was this: Hillary, Cruz, Rubio, and Trump. Sometimes it was Hillary, Rubio, Cruz, and Trump. (Driscoll disputes this.) Driscoll may be right to dispute this. I do not know if they could be called “orders” because Maria was not employed by anyone. But she was being guided by Torshin, she told me, and Torshin had suggested those priorities.

Byrne said he reported this to “the Men in Black.”

Two former FBI special agents deemed the claims improbable. It’s unlikely, they said, that a highly trained foreign agent would have revealed her targets Abha is begging the question. There is quite a bit of doubt about whether Maria is “a highly trained foreign agent” or merely a graduate student who was hoping to network and backchannel between the US and Russian liberals. In fact, even the US government has surrendered any claim that Maria was some kind of “highly trained foreign agent”. How wonderful that the public is getting to see such significant inaccuracies now, and will get to see in real-time how the Washington Post (where “Democracy Dies in Darkness”) handles fixing them for their print story.

 — in this case, as Byrne says, the four political campaigns — or that the FBI would have approveda romantic relationship as a means to collect intelligence. They not just “approved” but “requested” . However, I agree that this was extraordinarily unusual of the the Men In Black. They are the good guys, they specifically told me that “We are the good guys, we are not like the other guys, we never do this, never in our three careers have we heard of a request like this being made…” etc.

They also dismissed Byrne’s claims that his 2015 phone calls helped spearhead the massive investigation into Russian election interference that culminated in a sprawling, $32 million inquiry by special counsel Robert S. Mueller III. They are either wrong (if they are on the outside) or lying (if they are in the know).

Byrne said he was never contacted by Mueller’s team.

“There are a lot of steps it seems he’s not aware of,” said John Iannarelli, a retired FBI special agent, who called Byrne’s claims “ridiculous.” “Nothing he has said indicates that he understands how procedures operate.” Yes, I get that a lot. He’s wrong. I know more about how such procedures normally operate than I care to remember. I also can think of the several times in my life I have been told, “You need to understand that you have a ‘non-standard’ relationship with the United States Government.”

When asked why Butina might have revealed her alleged orders, Byrne said she did so while she was “heavily ‘under the influence’” of “large quantities” of serotonin, oxytocin and dopamine — the brain chemicals that spark feelings of love and attraction.

Byrne claims his history with the FBI dates back to 2002, when his friend and former NBA player Bison Dele disappeared in the Pacific Ocean. Byrne wrote on Deep Capture that he had a “minor involvement in helping the authorities sort it out.” (Dele has never been found; authorities believe he and two others were killed by his brother.)

As for Butina, Byrne said that he was under the impression he was receiving orders from top FBI officials. Six months into the relationship, Byrne said, the bureau asked him to break up with her. And he did — by text.

Soon though, Byrne says, the “Men in Black” returned with another request: “They wanted to ask me to rekindle a romantic relationship with Maria Butina,” he wrote on DeepCapture. “Russia was trying to subvert our election, and I was to get to the bottom of Maria Butina. ‘Gloves off.’”

Byrne says he obliged, setting off a chain of events that led to his departure.

***

Byrne is out — but the turmoil at Overstock remains.

On Monday, the company revised down its earnings forecast for the year — in part because of “significantly” higher insurance costs for directors and officers — and announced that its chief financial officer had resigned. Its share price has tumbled about 20 percent this week.

Former employees say Overstock’s retail site has become overly dependent on sweeping discounts and antiquated ideas. They expressed doubts that the new CEO, Jonathan Johnson, a company veteran who most recently led Overstock’s blockchain arm, would be able to steer the business in a new direction.

“I’ve been shoulder-to-shoulder with Patrick for 17 years,” Johnson, who unsuccessfully ran for governor of Utah as a Republican in 2016, said in an interview. “If Patrick’s the architect, I’m the builder.”

In practical terms, Johnson says, that means Overstock.com — synonymous for many with bed frames and bath towels — could soon become solely a blockchain company. “If the right fit comes along at the right price, well, we could find another home for retail,” he said.

The company’s e-commerce business has faced mounting competition in recent years, not just from rival websites, but also more traditional retailers like Walmart and Target that are doubling down on home goods and furniture. Overstock’s largest competitor — and the one that seemed to most vex its executives — was Wayfair, a company that regularly posts hundreds of millions of dollars in annual losses but has attracted large-scale venture capital funding and has eclipsed Overstock in revenue and market share. Last year, Wayfair posted a loss of $504 million, more than double Overstock’s $218 million loss. Again, see the below graph. And yes, it is true that two years sago I told Wall Street I was going to hit the gas and lose a lot of money in an attempt to copy Wayfair, and we did just as I said, but having seen that no one cared, we snapped it back and by Q2 posted profitable Adj. EBITDA.

What is even more interesting is that Abha knows (and respect to her, for figuring it out for herself) that the correct number to look at it accumulated capital burned, and there Wayfair is approaching $3 billion. And that they will start showing profits when these two lines cross:

Wayfair’s growing market share, former executives said, was a frequent source of tension within Overstock. And although Byrne’s departure may have helped the e-commerce giant insure its executives in the short term, they say they’re still worried about the company’s long-term prospects.

“You look at it now, and the retail business just isn’t loved anymore,” Simon said. “If you’re not going to feed the baby, you should at least give it up for adoption.”

***

Byrne is now on an island in Asia, he says, waiting for the whole thing to blow over. He says he has a duty to distance himself — both physically and financially — from the company he started 20 years ago.

He has gold and silver reserves in Switzerland, though he is becoming worried about “the deteriorating world situation.” Last week he sold his entire stake in Overstock — worth $90 million — and is reinvesting some of it in gold, silver and two types of cryptocurrencies, to shield his fortune from “acts of retaliation from the Deep State.”

“That is important because, in fact, I am now going to shellac them,” he wrote on his blog. “Actually, ‘shellac’ is too weak a word for what I intend to do to the Deep State. Sit back and enjoy the show.”

What a wonderful, unique opportunity you, the public, have right now. You have Abha’s first attempt at writing. You have all the notes I have made herein: corrections, data, graphs, and links. You have two days before her story appears in the print addition. For the first time I can think of, you have the chance to watch the next sausage being made. Without being rude or insulting (for actually, Abha is definitely one of the better ones, is smart enough to be one of the best, and I can promise you the here-and-there skewing of truth in which she has engaged is far more likely to be a result of the Posts editorial processes than Abha’s direct fault), let Abha know you are watching  (again, only because it is public will I share her email: [email protected] ) and, after familiarizing yourself with the content of those links, you may ask her why she has chosen to skew certain points to adhere to an 11 year old party line. Let us see what changes she makes in her approach for the print edition, if any. For the next two days you can live as I have lived for years, seeing a story come out when you already know the truth, and know the journalist already knows the truth.

For the record, my prediction is that they will do one of three things:

1. They will cancel the story to appear in the print edition this coming Sunday (9/29);
2. Abja will publish but amend her point of view to account for the things I have documented in this blog (i.e., the honest thing to do);
3. They will ignore everything and publish the new story with the same skewing where they need to. And then the public will get to see first-hand, for once, how the sausage is really made.

So help out of you wish by clicking those links and contacting the Post (either Abha or the editors) about them. Then let us enjoy this weekend, waiting together to see what emerges from the sausage-making machinery at the Washington Post (where “Democracy Dies in Darkness”).

This story was first published on Deep Capture. Deep Capture features original investigative reporting on the all-too-cozy relationship Wall Street has with regulators, media, government and the intellectual establishment.