Burned Investors Revolt!
Dear Rundown Reader,
People make mistakes.
But when mistakes cost folks over $6 billion dollars in lost assets… it’s hard to forgive.
And that’s why David Einhorn of Greenlight Capital Inc. is facing a full-blown revolt.
It’s also why he’s all over the headlines today.
Today’s Rundown looks at what went wrong, and if there is any coming back from this unbelievable screw up.
But first, a letter in response to our take on HOG.
“Harley has been in financial trouble for years, this is just one of the final nails. Funny thing is, if they hadn’t panicked, they probably would be ok.”
Customer’s tastes have changed away from HOG’s line of product offerings. Their days were numbered well before this.
Your Rundown for Thursday, July 5, 2018…
How A Famous Money Manager Lost Folks Billions
They say any press is good press.
We’ll put a nice chunk of change up that David Einhorn of Greenlight Capital Inc. feels differently.
Today’s Wall Street Journal headline reads:
“‘This Is Unbelievable’: A Hedge Fund Star Dims, and Investors Flee”
Flee is an understatement. More like full blown mutiny.
Clients are irate.
“He’s stubborn,” notes Peter Weiss speaking to The Wall Street Journal. “He’ll never admit he’s made a big mistake…It just makes me crazy.”
According to other clients, a lavish lifestyle, an off-putting “closed door” approach to clients and odd sleeping habits are reasons for Einhorn’s failures.
Things are getting ugly.
CNBC notes, Einhorn’s fund has lost 7% in June and for the year is down 18%.
Since 2014, his fund has eroded from $12 billion in value to $5.5 billion, as reported by The Wall Street Journal.
This is utter failure.
And in revolt investors have yanked approximately $3 billion out of the fund over the past two years.
We can’t blame them either.
It seems Einhorn has lost the pulse of the modern market.
One of its top holdings is still General Motors.
And his battle to successfully short Tesla has cost his clients a boat load of cold-hard cash.
Einhorn’s response to all this?
“When we recognize a mistake we exit the position and own up to it in our quarterly letters,” The Journal reports.
Talk about someone who doesn’t get it.
Look no further than David Einhorn.
Then, grab your money and run in the opposite direction.
Now, turning to the markets this morning…
Market Rundown for Thurs., July 5
Yield on the 10-Year Treasury sits at 2.851% this morning, up 0.013.
S&P 500 futures are up 21.25 at 2,734.
Oil’s up $0.22 to $74.36.
Gold’s up $2.60 at $1,256.
Bitcoin goes for $$6,653 this morning, according to CoinDesk.
We’ll talk again on Friday.
For the Rundown,