Actually, I think the most significant development of the quarter may be Venezuela. I mean, you see companies like Colgate writing off their entire operation. The exchange rate in Venezuela is 103-to-1, and Herbalife has been marking their revenues and earnings from Venezuela at now 10-to-1. So things are 90% worse than their reported earnings. I think what people don't realize is that Venezuela, even though it is something like 4% of revenues, even as they reported, we think it is about 20% of the operating income of the business. So if Venezuela is accounted for correctly, their earnings will decline dramatically, we think. We'll see what they do, but we'd be astonished if Pricewaterhouse allows them to continue to account for their revenue and earnings from Venezuela at a 10-to-1 exchange rate when the market is really 103-to-1. Even the official market today is 50-to-1. Supposedly they're paying their distributors based on a 50-to-1 royalty exchange rate. How can they be booking their revenues at 10-to-1?
Pershing Square Capital Management is currently short HLF because Bill Ackman thinks Herbalife is a pyramid scheme and will eventually collapse.
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