Readability.

This is my favourite little browser gadget.


If you do a lot of web reading as I do then this is an invaluable tool. In very simple terms, it allows you, with one click, to present on your screen an article, blog, whatever in very clear text without any clutter. You can experiment with the settings that best suit you. (I have it set to "ebook", "medium", "narrow").


Download it for free at Readability

(If you are using Chrome as your browser then you can install it directly as a browser gadget which is even easier)

Hours of Fun.

As I mentioned a week or so ago, I am retiring my old "CST Valuation Matrix" spreadsheet. I now think that our perspective of the company should be viewed on the basis of Sales value (and more specifically, sales growth) rather than kit volumes. Coincidentally, at the recent broker presentation it was mentioned that the  Company has largely taken this view also. The company has now reached the stage where it deserves to be analysed on real financials. Trying to squeeze the concept of "kit sales" into financial projections no longer makes sense.


Consequently, I have now made my first attempt at a spreadsheet "CST Growth Projection" that approaches this analysis in a more conventional manner.

No explanation necessary. (What is 1 in 6 expressed as a percentage?)

A closer look at Sales Growth.

17 hours! that's nothing - try 20 hours. Up at 3am, car, plane, big red bus, walk, presentation, big red bus, plane, car, back home at 11pm. 20 hours - beat that Rog! :)


Seriously, having the Half Year Results fleshed out by the Company is invaluable. For me, it demonstrated that just looking at reported figures often does not paint the real picture. Particularly so when we are looking at a company that is still only taxiing out to the runway for lift off. At this stage in the development of the company, it is all about growth. Both actual growth and projected growth.

Half Year Presentation Notes.

Cellestis have just released their Half Year Presentation Notes

I disagree with Bioshares.

Bioshares has this week reported on the Half Year financials from Cellestis.


They note that the previous sales growth rate has ceased in the half and recommend a sell of CST shares. Now they are entitled to make that call (and their readers are entitled to follow it or not). However, in my opinion, their analysis of the figures is far too shallow for it to drive a valid conclusion. 

The Cellestis Story. Part Three.

Continued from The Cellestis Story. Part Two.


Covering the technical aspects of QuantiFERON has dragged on a bit (but worth the time, I think). In this third (and short) chapter of the story I am going to wrap up this section so that I can move on to other parts of the story that describe the investment imperative.


We've had a pretty good look at Tuberculosis. We've looked at how QuantiFERON uses an aspect of the body's own immune system (Interferon-Gamma release) to diagnose TB and come to grips with the advantages of QFT over the previously used TB diagnostics. 


Now, I'm betting that, having thought about it, you are now thinking "well, that is really cool - we take some blood, add it to some TB antigens* and look for Interferon-gamma as an indication of TB infection. So ... what if we used different antigens? Could we diagnose other infections?"


You bet your booty you can!


Other Diagnostic Uses of QuantiFERON.


In theory, the QuantiFERON method could be used to diagnose any infection  that generates an immune response. All (!) it takes is to identify and produce the appropriate specific antigens.


The list of potential candidates is huge and includes many cancers, auto-immune diseases, inflammatory diseases etc etc. 


Of course, in the end, a number of factors will determine which diagnostics will be developed for commercial release. There is little point in releasing a new diagnostic for an infection that already has an effective diagnostic. Likewise, it is unlikely that Cellestis would produce a diagnostic that has a small demand. 


Cellestis are working on potential new diagnostics in their laboratory however, their identity is shrouded in secrecy. 


Currently, in addition to QFT-TB, Cellestis have commercially released two other products using the QFT technology.


QuantiFERON-CMI


This is basically a QuantiFERON diagnostic kit with no disease specific antigens included. It is sold to other Scientists and Researchers who wish to use the QFT method to experiment with other uses for the technology. Whilst, obviously, it is not ever going to generate any worthwhile profits for Cellestis directly, it is still very important. Through this product Cellestis are encouraging wide ranging research into the uses of the technology. This provides two clear benefits back to Cellestis. The first is that it helps in generating understanding, awareness and acceptance of the QFT technology in scientific and medical communities. Secondly, the QFT technology is very tightly protected by patents throughout the world. Any scientific research that results in a commercial product will generate profits back to Cellestis.


QuantiFERON-CMV


This is quite an interesting diagnostic that actually begins to open up the view that the QFT Technology has a huge number of potential applications.


Cytomegalovirus (CMV) is a herpes virus that infects between 50% and 85% of the population. Similarly to TB, it remains in a latent form in the body and causes no problems for people under normal circumstances. Again, the competent immune system deals with CMV quite effectively.


However, it poses special problems for transplant patients. If a donor recipient that does not have the T-cells to fight CMV receives an organ from a donor with CMV, the recipient is at huge risk of developing full blown CMV which, at worst, can result in death. Furthermore, the anti-rejection drugs administered after transplant can weaken the immune system enough for CMV to become active.


As opposed to QFT-TB, QFT-CMV is not used to determine if somebody has CMV - rather it is used to determine if somebody has the T-cells to fight CMV. It is important that this status be established before transplant and monitored during post operation recovery. This is the role of QFT-CMV. 


There are currently about 70,000 solid organ transplants performed in the world each year - each of these transplants would require multiple uses of QFT-CMV. Clearly, CMV is not going to generate the same income as QFT-TB (even though it sells at a price of multiples of QFT-TB). However, over time (particularly as the number of transplants increase) it will generate significant income.


Outside the Square.


A final note on uses of the QFT technology. As the QFT-CMV demonstrates, the QFT technology has uses other than simply disease diagnosis. Anywhere that it is of value to measure the immune system, QFT has a potential use. A very interesting use is that of monitoring the effectiveness of vaccines. Remembering that a vaccine works by educating the immune system in how to fight a future infection, QFT can be used to monitor whether the vaccine given to a person has, in fact, worked to prime the immune system. (I won't drag you through the science of this but it's pretty obvious when you consider the description of the operation of the immune system back in Part Two.)


The Future


QFT-TB is obviously the Company maker. However, we can anticipate a long and full pipeline of other products in the future that are equally as important as QFT-TB. The QFT technology being used is patent protected into the 2020's and future innovations and products will, no doubt, be well protected.


Next: Something different.






*Antigens. You may have noticed that I have changed from using the term Proteins to now using the term Antigens. For our purposes the two are basically the same thing. Generally, Cellestis use the term Antigens, so I will from here on. Besides, it sounds cooler.

CST Valuation Matrix

Many of you will be familiar with my "CST Valuation Matrix" spreadsheet that I have been dragging around behind me for several years.


A few people have contacted me asking that I update and re-release it. I have been specifically asked to try to integrate the real figures that we have seen reported for the Company over the last two years. I have made a valiant attempt to do that but, frankly, this spreadsheet has now been stretched well beyond it's usefulness and I anticipate that this will be the last time that I release it. Bear in mind that this spreadsheet was developed waaaaayy back when CST was a totally speculative investment without any significant Sales (or Profits!). I believe that this spreadsheet was of some use back then for playing around with scenarios - that use is much diminished now. 


In doing the above, I have had to take some short cuts and make some gross assumptions.

Watch this space.

G'day,


I'm going to be busy with other things for the next couple of days and probably won't be able to do anything here. Part three of the CST story is coming along nicely.


As I mentioned earlier, this will be a low volume (but hopefully high value) blog. If you don't want to waste your time having to check the blog over and over, you might want to sign up for an email alert whenever anything is posted to the blog - just put your email address into the box over to the left there. I promise that I don't have a warehouse full of Viagra that I want to unload on you. 


Don't forget that you can leave comments at any time.  

Lodge Partners CST Research.

Subsequent to the Half year CST results Lodge Partners have released a research document. With their kind permission here it is.

Guessing Competition. Results.

Congratulations to Tassie who guessed Sales of $18,226,000 which was exceptionally close to the actual result of $18,207,000.


Congratulations to Rog who guessed NPAT of $3,133,000 which was also close to the actual NPAT of $3,189,000.

As a group, we didn't do all that well with our Average Sales figure of $21,276,894 and Average NPAT of $4,184,185.

CST Half Year Results. Commentary.

Well, the results for the HY have come in at the low end of the "guidance" that various pundits had estimated from the comments made at the AGM. We all knew that the financial results for this HY were not going to demonstrate the stellar growth that CST has shown in the past. Not that it stopped many of us (me included) from hoping for something a little better.


We all know the reasons behind this.

• The strength of the $A.
• The ongoing impact of the GFC.
• The diversion of resources to the H1N1 (swine flu) epidemic.
• The delayed release of QFT In-tube in Japan.

Whilst the Japan launch has now happened we are advised that we are still at the mercy of the other issues for the second half. Regardless, the Company does expect ongoing growth. 

I am sure that we would all have liked a slightly larger dividend.  I presume that the reason for a dividend of only 1.5c ff is that the company is exercising its previously stated desire to maintain full franking of dividends.

Having stated the above, there is little in the actual figures that need comment.

Expenses all seem in order with Revenue. While Revenue rose 26% cf pcp, EBIT rose 28% and Expenses rose 22%. 

Inventories are up slightly but not so much that it raises any concerns. Possibly that was simply a requirement of the the Japan launch that was imminent as at 31st December.

Gross Margin of 61% is in line with previous accounts. 

CST Financial Data.

*** NOTE CORRECTED ***


CST released their Half Year figures today.


I will post some commentary later but in the meantime here are the CST Data Sheets PDF updated to include these latest figures.

One note. I seem to have a difference of opinion with CST on the EPS figures. I assume that I have the Shareholding figures incorrect. I will reconcile them (when I get a moment) and correct. In the meantime, if anybody can see where they are wrong you will save me some searching if you can let me know of the correction. Likewise, if I have made any errors in transcribing the latest figures, please let me know. 

The above problem has been fixed. It turns out that they do not include Forex gain/loss in the calculation of EPS. 

Competition Update.

It's not too late to enter. However, I suspect that you don't have much time left.


Here are the entries to date. (click on picture to view it full size).

Here's a handy little tip. If you view one of my posts in full, then you can quickly get back to the complete blog by clicking on the "Forrest thinks" title at the top of the page.

The Cellestis Story. Part Two.

I am assuming that you have already read The Cellestis Story. Part One. (You may want to go back and re-read as I have made a few minor changes).


In summary, TB is a very nasty bacterium found in every county in the world that results in around 2 million deaths per year. It can usually be treated with a cocktail of antibiotics (did I mention that it is not a pleasant treatment for the patient?). Up to 30% of the world population is infected with TB in it's latent form which can become active and transmissible at any time. Ultimately, the only way to reduce (and hopefully, one day, eliminate) this scourge is to find and treat the huge reservoir of latent TB. This is where Cellestis comes in.


Diagnosing TB.
Bearing in mind that TB can exist in two states (active and latent), we need to look at the diagnosis of TB in two parts.


Diagnosing Active TB.
Generally, diagnosing Active TB relies upon physically locating the bacterium itself. When the TB is pulmonary (ie in the lungs - the most common place) the most widely used method of diagnosis is the sputum culture. In simple terms this means the patient coughing up some sputum which is then grown in the laboratory and examined for the TB bacterium. Whilst this process can take up to 12 weeks (TB is a slow growing bacterium) there are other processes to achieve a speedier preliminary diagnosis including PCR which can achieve results in 12 hours.


X-rays are also commonly used to diagnose pulmonary TB. However, even TB disease diagnosed by X-ray requires confirmation. Of course none of this works if the TB is not in the lungs and, of course, none of these tests will diagnose latent TB. 


Diagnosing Latent TB.
As difficult as it is to diagnose active TB, it is even more difficult to diagnose latent TB. Remembering that latent TB is TB that is in a dormant, or inactive state, there is actually nothing to look for. There is no TB in the sputum, the blood or any other bodily fluid. Because it is dormant and not spreading, it cannot be seen by X-ray or CT-Scan.


So, how to diagnose a patient with latent TB?


You use the immune system of the body itself. In simple terms, if you have TB (latent or active) then the body's immune system (hopefully) knows how to fight the TB bacteria and is doing so. Therefore, if you can demonstrate that a person's immune system knows how to fight TB then you might presume that the person has TB. This was realized around 120 years (!) ago and led to the development of the skin test for TB. In it's various incarnations it is known as skin test, mantoux test, TST, heaf test or tine test. All of these tests are based on the same principle and I shall refer to them collectively as TST.


TST (Tuberculin Skin Test).
The TST involves injecting a small amount of tuberculin (a grab bag of proteins that look a lot like TB) under the skin (usually on the forearm). If the body's immune system knows how to fight TB then it should recognise these proteins and attack. That immune response will create a lump (induration) after two or three days at the site of the injection and the size of the lump is measured to determine whether the patient has TB. Whilst the TST has been very useful and extremely widely used, it has an enormous number of deficiencies. Some of the major ones are:

• - Because the immune system has a long memory, the positive reaction from the TST can equally be due to a past infection of TB, rather than a current one. Generally, it is considered that once a person has had TB, the TST is no longer a viable diagnostic for that person.
• - Because many of the proteins in the PPD are the same as those in the BCG vaccination, anybody that has been vaccinated for TB will show as a positive to the TST, regardless whether they have TB or not. Often patients do not know whether they have had a BCG vaccination or not. Some countries (Japan, for example) have a population that is close to 100% vaccinated - the TST is worthless in that situation.
• - The TST is a two step process. Injection of the PPD followed by reading of the lump two or three days later. Depending upon the environment, it is not unusual for 30% of patients to not return for their reading.
• - The TST is very subjective. Despite the extensive training of TB practitioners, there is a large "inter operator variability". That is, a lump that one practitioner sees as positive, another may see as negative.
• - If the patient has a weakened immune system (eg HIV) then the TST is likely to show as negative, even if the patient has TB. Even more importantly, the test does not indicate this situation. A patient with TB can thereby be sent on their way with a "clean bill of health" to perhaps develop active TB and spread the TB further.
• - If the time of the Doctors and Nurses administering and reading the TST are taken into account, the TST is an expensive test. If you add the lost work time of the patient, even more so.

Having said all of the above, the TST has played a very important role in controlling the spread of TB. If only there was something better ....

QuantiFERON-TB Gold 

The QuantiFERON (QFT) diagnostic uses a similar concept as the TST (using the body's own immune system) but approaches it in a different way that does away with the problems of the TST. Generically, QFT is an IGRA (Interferon Gamma Release Assay).

It is a bit complex and, in truth, the fine details are beyond me. The following description of the processes involved is therefore necessarily "broad-brush". Whilst it may not be scientifically exact, it is essentially valid.

The battle warriors of the immune system are T-cells. An immune response to an infection involves two different types of T-cells, Effector T-cells and Memory T-cells. When Effector T-cells recognize an enemy that they are equipped to fight they attack the infection immediately (within a few hours) and rally more troops to the battle by generating Interferon-gamma. Once the battle is over, the effector T-cells will eventually die. On the other hand, the memory T-cells remain in the blood (essentially) forever with the memory of how to fight a particular infection. When they recognize an enemy that they are familiar with they do not engage in battle themselves but instead generate Interferon-gamma that will eventually result in the production of the appropriate Effector T-cells. The Memory T-cells take some time to get their act together - this is an important distinction. 

The QFT approach to diagnosis, therefore, is to measure that production of Interferon-gamma as an indicator of infection. The process is quite straightforward. A small sample of blood is taken from the patient and it is added to some proteins that are very specific to the TB bacterium. If the patient is currently fighting a TB infection then their blood will contain effector T-cells that will recognize those proteins as TB and "do their thing". Part of which is to generate Interferon-gamma. The QFT diagnostic measures the Interferon-gamma as an indication of TB infection. Note that because the diagnostic looks at the Interferon-gamma produced in the first few hours only, it is not confounded by the production of Interferon-gamma that is produced by the memory T-cells some days later.

So, what does this mean when we compare QFT with TST?

• - The QFT only recognizes a current infection of TB. A past infection of TB will not produce a false positive reading (as would happen with TST). 
• - Because the specific proteins used in the QFT are present in TB but not in the BCG vaccination, the fact that a patient has previously been vaccinated for TB will not confound the QFT result.
• - QFT is a one step process as far as the patient is concerned. Once the blood sample has been taken the patient does not need to return for a "reading". Therefore, no resources are wasted on non-returns as with TST.
• - The QFT is performed in a laboratory, using commonly available instrumentation. There is no operator subjectivity involved (as with TST). The result is a pure metric.
• - If the patient has a weakened immune system then (as for the TST) there may be no readable immune response to the QFT proteins. However, the QFT method will recognise this and report an "indeterminate" result. This is extremely important as that patient will not be incorrectly diagnosed as negative (as would happen with TST). Instead the Doctor has the information to launch a further investigation of the TB status of the patient.
• - The total cost of a QFT test is less than that of a TST when all factors are taken into account. Cost Comparison - TST vs QFT.

It is worth noting that neither TST nor QFT can distinguish between active and latent TB. Once a patient has been diagnosed as having TB by either of these tests, further diagnosis is required to make the distinction. This may involve the diagnostics mentioned earlier and, importantly, symptomatic diagnosis.

Of course, it is easily seen that QFT can alert to active TB disease that cannot easily be diagnosed with the traditional tests for active TB (eg non-pulmonary TB).

I should mention that there is another IGRA diagnostic commercially available for TB (T-Spot). I will deal with that later but for the moment just take my word for it that it has some significant disadvantages when compared to QFT and presents no commercial competition.

Sensitivity and Specificity.

Sensitivity and Specificity are two measure that are used to define the accuracy of a diagnostic.

Sensitivity is the percentage of people in a group that have a disease that will be correctly identified as such by the diagnostic. Specificity is the percentage of people in a group that do not have the disease that will be correctly identified as such by the diagnostic.

The FDA quoted figures for QFT are a Sensitivity of ~89% and a Specificity of > 99%. 

Because the TST has never been subjected to the rigours of the FDA approval process there are no reliable sensitivity and specificity figures available. The available figures for TST vary enormously from environment to environment. In an ideal situation, it's sensitivity might approach that of QFT but it's specificity can be as low as 30% and even in a highly controlled  environment is unlikely to exceed 80%. Think about that - every person incorrectly identified as having TB is likely to be subjected to around six months of treatment with some quite nasty antibiotics (and alcohol is contraindicated during treatment!).

Next: The Cellestis Story. Part Three.

From the Coal Face.

These are some interesting comments from "reify99" who is an ex TB Nurse in the USA. I think it very clearly shows why there is "bottom up" pressure to use Quantiferon-TB in addition to the "top down" pressure that we are seeing expressed in trials and scientific papers.

Forex and Cellestis.

The impact of foreign exchange rates upon Cellestis is something that I know has generated a lot of discussion. Because Cellestis sells most of it's product overseas and with the exchange rate fluctuations of recent times, it is something that is worth trying to understand. I'm sure that with the upcoming Half Year results this matter is being considered by many of the Cellestis investors.


I always have problems in understanding anything but the basics of forex. So, to provide something that is far more useful than what I could provide I called on my friend, Cellestis investor and fellow tractor owner "Elleburra" to bring his expertise to bear on this issue.


Here is what he has to say.

The Cellestis Story. Part One.

I thought that one of the useful things that I could do is to rewind the Cellestis story right back to the beginning. I know that many of you, like me, have been following this story for several years and probably already know the story and facts very well. Although I should say that in researching for this exercise, I realised that there is much that I have forgotten. Whilst I am doing this to help the new arrivals get up to speed, perhaps even the old hands will find it interesting. I'm no medico and whilst some of you may be, I am sure that many of you aren't. What I will be trying to do is to present this in simple and straightforward terms. It's the way that I think about things anyway. 


It's a big story (and getting bigger every day), so it won't be knocked over quickly. I anticipate that it may take several weeks to tell, in several parts. I plan for it to be a thread of blog entries that runs in the background, liberally interspersed with blog entries on other matters, as they arise.


As always, I welcome your comments - particularly if I have made any mistakes or have missed or glossed over something that is relevant.

Cellestis Financial Data.

The Cellestis first half 2010 financial reports will be released later this month. For a company that is in it's early growth stages, I believe it is very important to keep a close watch on the progression of their financial performance. Not just the Sales and Profits but also other elements, including expenses, inventory and cash on hand.


To assist with this I have maintained a spreadsheet showing the financial reporting of the company every six months since 1st July 2005.

Tomorrow is a brand new day.

Okay. Firstly let me say that I truly appreciate the immense amount of support that I have received both publicly and privately. Much of it has been akin to being granted that unusual privilege of being able to read one's own obituary!  (often to the point of my own personal embarrassment)


However, I want to clear this issue once and for all so that I can move on to doing what I really want to do with this blog and so that you can read what you really want to read on this blog. 

Email subscription now active.

As promised (and as the title subtly suggests) you can now subscribe to my blog by email. Just enter your email address in the little box to the left  (surprisingly the one that says "Enter your email address") and apparently you will receive an email on any day that I make a new entry on the blog. 

Settling in.

Well, I'm still settling in to this new environment. You might have even noticed me moving the furniture around and painting the walls. Once I have finished with that I will get down to the real business of this blog - I promise! However, right now I want to address an issue or two and do some housekeeping.
Firstly, I want to say to all those that have offered their very generous best wishes for the future of my blog that I appreciate your interest. I really hope that I can live up to your expectations and provide something that you will find worthwhile reading.


Secondly, I want to address some issues that arise from my initial entry. In my more than ten years of posting on forums, I have made many friends. Those friends have been, and continue to be, very important to me - they really are a part of my life. I hold in particularly high regard that special group of friends that have become a tight group of people with the common interest of their investment in Cellestis. I am proud to be part of that group. We should commend ourselves on the way that we have worked together as the most well informed group of investors in a specific company that I have ever come across. Each have brought to this group their own talents, knowledge and experience to the task of analysing every single facet of this investment. My decision to move my posting from the forum where we all gather to this venue should in no way be seen as me resigning from that group. My fervent hope is that I can still call myself a part of that group and that my entries on this blog will still be seen as contributions to the group. Hopefully, this new venue may even allow for my contributions to increase in value.


I am aware that because I was in the small group of people who started posting about Cellestis in the very early days of its listing, I have sometimes been seen as one of the leaders of the group. If it is even partly true that I have earned that accolade then I am both honoured and humbled. However, I do not want anybody to misinterpret that my totally personal decision to relocate from the forum to this venue is in any way a suggestion that the forum posting group should change in any way. It is simply that the forum is no longer where I wish to "live" - that is a factor of the forum operation as it impacts me, not of you, the contributors.


For those who are not familiar with my style of writing, I apologize for what must seem the over sentimentality of the above. Those who are familiar with my posting will know that it is just a manifestation of the fact that I write from the heart.


Now some housekeeping.


Whilst I have a head full of ideas (and a full tank of fuel in my lawnmower) I do not really know where this blog will end up. However, I am pretty sure that rather than several posts per day, it is far more likely that I will be writing one or two posts every few days. I do realize that can make it tiresome for you to recheck the blog continuously, only to find that nothing new has happened. Once I work it out, I will provide a facility for you to "subscribe" to this blog to receive notifications of new entries by email. I can only hope that you will find it worthwhile to do so.


Just in case you haven't noticed, at the end of each post is a link enabling you to leave comments. I have noticed that some of you have availed yourselves of that facility already. I wholeheartedly welcome comments - if nothing else they let me know that somebody out there is listening.

What's it all about?

Here again? Nice of you to drop in.


As I mentioned in my previous entry, I now need to tell you what I will be doing with this blog. So, here goes.

Indulge me. (Some thoughts about forums)

G'day,


I guess the usual thing to do when starting a new blog is to give potential readers some sort of idea of what they might expect to read here as the blog develops over time. I will do that. However, firstly I hope you will grant me a small personal indulgence so that I can explain how I got here and to air a personal frustration.




I have been using the Internet since it's very early days. I have also been buying and selling shares on the ASX for almost 30 years. The share market, along with the application of logic, the beauty of the the English language expression and the engagement in intelligent discourse have become my undying passions. For a dozen or more years I have realised those passions by being a very active participant in a handfull of Internet forums dedicated to the share market. Perhaps you have even read some of my posts in those forums.


My forum of choice for the last seven plus years has been a single forum that I joined within weeks of it being launched. In that time I have conributed over 2700 posts, received much positive feedback from other members and, I hope, have done my very best to be a worthwhile contributor to the forum. I have been a very strong supporter of that forum. I have valued greatly the interraction with other members of the forum - both those that agree and those that disagree with my opinions. I believe that my posts have been logical, based in fact, courteous and at least sometimes useful. My interest in the share market is all encompassing, my posts have ranged from posts on specific stocks, through trading and investing methods to the mechanics of the market, an understanding of financial issues, and the psychology of market participants. I put a lot of work into my posts. From other posters I have learned much.


An unavoidable truth is that, being open discussions, all Internet forums tend to suffer the same ills. There will always be those who hold diametrically opposing opinions. When that leads to intelligent, adult, logical and respectful conversation there is much knowledge and enjoyment to be gained by the participants and observers. Unfortunately there will always be those who disagree with an opinion but lack the ability to express their opposing opinion in an acceptable manner. This is, of course, aggravated by the fact that posters on Internet forums are largely anonymous and therefore often do not obey the normal social mores. Those of us who have been posting in forums for a long period soon learn to ignore, brush off or laugh off such posts. 


Furthermore, stock market discussion forums are a special case - most of the posters have "real world money" invested in the stock market. That fact alone brings with it another dynamic. The attitude of a poster can be enormously impacted by how their particular investment/trading choices are performing. That attitude will flow through to both the style and content of their posts. Again, experienced posters will make allowances for that and adjust the tone and content of their posts accordingly. They will usually also be more tolerant of posts and responses made by those who are hurting in "the real world" through their stock market endeavours.


This unusual direct relationship between the forum and real world endeavours gives rise to another form of poster. That is, those that think that they can financially benefit themselves at the expense of others by posting incorrect information, overly positive or negative sentiment or by destroying the message of those who attempt to bring some reality to the discussion.


Throw in the usual mix of plain old ratbags and the Internet forum can be a wild and woolly place. If I was going to offer any advice to new participants in a stock market forum it would be the same as that that should be given to any new participant in the stock market itself - be very carefull and take a lot of time before doing anything at all. In the case of a stock market forum, spend a lot of time reading posts by various posters to try to establish which of those can offer some value and which should be taken with a large grain of salt.


Now we approach the crux of the matter.


The accepted approach for a forum operator to deal with the dynamics of the forum is by a process of moderation. generally this means that a single person or a small group is given the power to remove posts and admonish (or punish by removal of rights) those who are identified as stepping outside a set of rules. This seems an obvious approach and is almost universally accepted.


Unfortunately, moderators themselves are human. They make mistakes, they can have their own agenda, they can let personal feelings impact their actions and they can be unduly influenced by a vocal group. I freely accept that being a moderator is a difficult task - one that I would not take on. However, having taken on that role it behoves the moderator to act in a manner that best benefits the forum community - certainly not exclusively their own interests or the interests of a small subset of the community. The actions of the moderator will ultimately determine the value of and thereby the success of the forum. The moderator should be able to judge the actions of posters as a big picture and pitch their decisions accordingly. Commonsense dictates that a minor, inadvertant technical breach of forum rules should not receive a penalty totally disproportionate with the "crime". For example, it may be appropriate to delete such a post to prevent the potential of a growth of bad behaviour by other posters who read the post. However it is totally inapropriate to specifically punish that poster by removing their posting rights. Moreover, when moderators make a mistake (as they will inevitably do) they should be adult enough to accept that they have done so and, if possible, correct their mistake.


Ok, the astute reader will obviously recognize that the scenario outlined above roughly describes my recent dealings with a forum moderator. Whilst I don't think there is much value in "arguing the point" here I will give a broad outline of my "transgression". 


As mentioned above, my comments and opinions expressed in my forum posts are not always positive in regard to specific stocks. Personally, I believe that by following and understanding some stocks that I have doubts about, my stock picking skills are improved. However, as for posts on stocks that I favour, my posts on these stocks are always logical, based in fact and courteous. Of course, as implied above, there will always be those who disagree with my opinions or conclusions. I have no problem with that and, indeed, welcome the discussions that ensue. Other posters refute such arguments with silly insults or one line ramps. Such posts provide no value to me (and, I suspect, to anyone else) and I generally ignore them. Recently, such an incident ocurred where I provided a well thought out post and was replied to with a personal insult. I am long past worrying about the opinions of such posters and as said before generally ignore such rubbish. In this case (and being a Saturday where, generally, some allowance is often made for threads drifting "off topic"), I replied with a harmless joke, actually a totally self-deprecating joke. This was simply my way of laughing it off. 


The moderator decided that replying to an insult is a technical breach of forum rules (and technically I would have to accept that it is). The moderator removed my post. I can accept that - it matters to me neither one way or the other. Unfortunately, the moderator then stepped over the line and suspended my ability to post on the forum. In my opinion that was a mistake - particularly in light of some of the other posts that have been made in the very same thread. Even this, in time, I might have accepted (with a sigh at the incapacity of some individuals to compose rational thoughts). 


I contacted the forum administrator privately to discuss this specific issue. Unfortunately, he refused to accept that a mistake had been made and repeatedly avoided discussing the substantive issue. The final straw was his threat that if I continued to attempt to discuss the matter with him, he would punish me further with an additional suspension. Anybody has the right to walk away from a discussion but I find it repulsive to terminate a discussion with a threat. I see this as being akin to somebody ending a philosphical discussion with threat "One more word from you and I will punch you in the head". This approach is something that (unfortunately) you might expect to experience in a schoolyard but certainly not in a rational discussion between adults. I cannot accept that behaviour.


As a final note, I should mention that other posters have experienced similar responses and have made their own decisions about their future. I find it sad that the number of quality posters on the forum is becoming less and the posters of dross are becoming more. However, as I have said to the administrator, it is his forum to run as he wishes. Hopefully, one day, this forum will again become a place where people with an adult attitude can exchange ideas, thoughts and opinions. 


Anyway, I have that off my chest now. I have not created this blog as a venue for forum bashing - I have much better things to do with my time. 


This blog entry has gone on far too long so I will subsequently make a blog entry that will give you some idea of what I will be doing with this blog. It will certainly be something that I can be proud of and perhaps even of interest to you.


Until then. "Try to be as good a person as your dog thinks you are."