Here's what I missed on my short call- Frank Quattrone

So all my insider info about how Google was going to miss this quarter's numbers were rendered worthless at the last moment by the guy pictured on the left.

Frank Quattrone, the man who was behind about 70 percent of the dot.com IPOs in the late 1990s, was recently hired by Google as an advisor to come up with a solution to stop Microsoft's purchase of Yahoo- at any cost. Let me repeat- at ANY COST.

Quattrone was convicted after a series of damaging emails exposing him as a massive criminal were published, and he faced a lengthy prison sentence for his misdeeds.  However, the U.S. Court of Appeals for the Second Circuit overturned his conviction on a technicality related to a mistake made during the trial regarding information presented to jurors.   

This is the guy behind nearly all the 8 trillion dollars of investor money lost in the dot.com collapse, and he made around 150 million dollars per year for his effort. Nice work if you can get it, eh?

BTW- not a single person has ever gone to jail for any fraud committed during the dot.com mania. Zero. Even though criminal activity among CEOs, brokers, analysts, and bankers was widely known and exposed, amazingly there has never been a single conviction.  Every case was settled out of court without ever admitting guilt, even when the evidence was glaringly obvious.  Quattrone came the closest of anyone to actually getting the handcuffs, but his estimated 1.2 billion dollar net net worth managed to "buy" his freedom.   Now that his prison risk has passed, he started a new "banking advisory" firm called Qatalyst Group less than one month ago.

My tipsters have told me that he has been given basically absolute power at Google for any matters relating to Microsoft or Yahoo, on an "off the books" basis.  The recent accounting shenanigans with Google's quarterly earnings were under his direction. Quattrone practically invented creative accounting during the dot.com boom.

And here's the kicker- Yahoo has been given the same advice from him, according to my sources.  Look for Yahoo to "beat" their estimates by reducing their tax rates and slinging everything possible into the "one time expense" column that they can.

All of which is upsetting, since my old company actually did business with Yahoo a decade ago and Jerry Yang seemed like an upright guy when I spoke with him.  I guess desperation will make anyone do crazy things.  I would recommend going long YHOO calls before earnings because I've been told Quattrone's strategy consists of two things: pumping Yahoo's stock up far above Microsoft's offer price, hopefully in a dramatic 20 percent way like he did with Google, and the previously announced poison-pill deal for Google to take over Yahoo's search business thus making Microsoft's acquisition pointless no matter what the price.