creating a list item

creating a list item

hi
I am a beginner with jquery and  was trying out the tutorial at
http://lethain.com/entry/2008/sep/21/intro-to-unintrusive-javascript-with-django/

in the tutorial a list item is added to an ordered list as follows
var newLi = $('<li><a href="/note/'+slug+'">'+title+'</a></li>');
$("#notes").prepend(newLi);

I can't understand why there has to be a $() around the string that 
constructs the list item.I replaced it with a simple string

var newLi='<li><a href="/note/'+slug+'">'+title+'</a></li>'

This also works .Can someone tell me why the $() is needed then?

thanks
harry