While most people remain glued to the TV watching the trainwreck of our financial system as a bunch of clowns try and untangle the mess, Digg raised $28 million to buy computers and hire 100 people.

How are they related?

Digg, is a social leverage machine. It’s all about leveraging the community. Lot’s of the $28 million may be wasted, but most if not all of the capital will be deployed in a hunt for social leverage. Now, I have long thought that the Digg community is dumb, but that does not make it a bad business, just not a community for me. Your local bank is all about leveraging your deposits and as of late, screwing the community.

Financial leverage is so seductive, that it become destructive, not so with social leverage.

Facebook is the source of billions of ‘nerd’ hours (equivalent of zero loss of productivity to the US – ok I kid the nerds) focused on why it’s not worth $15 billion, continues to chug along quite nicely during the SPLURGE because it employs social leverage, not financial leverage.

Balance Sheets are all the rage these days. For the last 7 or 8 years they have not mattered. That’s too bad, because they do matter.

The balance sheets of businesses deploying social leverage may not get you horny or Wall Street horny, but color me horny as always.

Spend some time looking for stocks and businesses that have great balance sheets, are focused on growing with social leverage and are not wasting their time figuring out the damage from their financial leverage.