Which also means being careful of short selling. It can put you at unlimited risk even if you are absolutely right.
The risk is in borrowing, not short selling. How many momo jockies out there think about the "unlimited risk" from buying Tesla on margin? In that case, you're shorting USD, but no one talks about that because it always will be fashionable to short USD.
Just like it always will be fashionable to short JPY, for carry and more. Until it's not.
So technically buying almost any stock can be a way of shorting the USD in that you are selling it now and will buy it back later.
The risk - besides that of the company itself- I suppose is that if you have massive deflation you will end up with less USD. I don’t think anyone is worried about massive deflation of the USD, since the Fed can and would prevent that.
Today the only government (that I know of) committed to not printing money is Argentina but they have other issues affecting their economy and therefore inflating their currency.
Given that governments don't seem to have desire stop money printing any time soon, buying BTC is sound.
You don't know many countries, do you?
Argentina still prints more money, and has higher inflation, than most places around the world.
Singapore and Switzerland are some examples of nicely conservative monetary policy.
If you borrow $1,000 to buy TSLA your downside is limited—you can’t possibly lose more than $1,000.
Tether provides a good illustration of the principle I mentioned-- which I concede is a bit theoretical in the case of USD:
Tether is supposed to trade at $1 and gets press when it trades below. But, sometimes it also trades above, at $1.01, $1.02 and even perhaps $1.03. So, if you sold a lot of it thinking trading higher was impossible, you can be surprised.
There are a number of businesses I know are badly run and will eventually fail, but I cannot find a way to monetize that safely without knowing the timeline for failure.
For example, the opportunity to sell $TSLA for $180 in one month costs about thirty cents right now. Keeping this up for ten years would cost $36.
A put option is a contract between buyer (me) and a seller of the option. The contract guarantees me a right to sell stock at a strike price to the seller of the option.
If current stock price is lower than put contract strike price, I can exercise the contract and make money: I buy the stock from market at e.g. $78 (current price) and sell at e.g. $128 (strike price).
If stock is delisted the contract is still valid and enforced by the clearing house. They'll just assume that current price is $0 and force the option seller to just fork me cash without receiving the (unavailable) shares.
But it doesn't happen in practice because stocks are not just delisted without warning.
For example, Bed Bath & Beyond announced bankruptcy in April 23, Nasdaq announced delisting in April 25 and trading stopped in May 3.
So there was a week for option holders to settle their trades.
You have to buy really farther out or really far off strike both of which have nearly zero probability ( delta is nearly zero and less than 1)
Credible arguments can be made however that short-selling itself, especially naked short selling, is an unethical thing to do as the pure possibility of short-selling makes some forms of crime possible in the first place, such as a criminal shooting up the road bus of a German soccer team to profit from falling stock prices [1]. Especially in the era of anything being credibly fake-able with widely available AI tools, short-selling can look to criminals as a very profitable way to make money.
Also, short-selling incentivizes large stock holders to be lazy and not do their jobs. Imagine a huge ass pension fund - they can (and do) make money as the counterparty in short-selling deals. Some see this as a necessary part of stocktrading life (because it provides liquidity), but personally I think that it removes incentives for the pension fund managers to do their job and audit the stock they hold for their shareholders in turn themselves.
Besides: enforcing securities code and auditing companies should not be the job of vigilantes. I applaud the efforts of ethical short sellers, but in an ideal world, that job would be done by the authorities.
[1] https://de.wikipedia.org/wiki/Anschlag_auf_den_Mannschaftsbu...
2. There is very little money in shorting. Pumping and dumping by making up positive news is much more lucrative. "to the moon" has been a trope for years, and there is no equivalent on the short side. Even the world's most successful short seller Jim Chanos was successful because the short portfolio functioned as a hedge that enabled a leveraged long position on broad indices. It's pretty hard make money net short when the market goes up for two straight decades.
3. The authorities don't have the resources nor the dogged inclination to hunt down fraudsters. The authorities can't and shouldn't base an exhaustive investigation on vaguely shifty CEO behavior. Short sellers can and do start their investigation based on gut feeling.
2. Operational shorting as a part of market making and derivatives strategies is an enormous part of the market. This is also demonstrably false.
3. The DOJ has the resources, not the jurisdiction. Self regulation will always be underfunded. Trying to argue that short selling is an effective form of privatized self regulation is laughable.
They seem to be going after egregious high flyers with a pattern of grift who are vulnerable to a short.
Of course I could be wrong
Moral hazard. We are in this thread, where many people complain about the irrationality of the market, of bad choices having no ill effects, and at the same time it is argued that authorities should prioritize and only investigate and prosecute large cases where the ROI is good.
I think the ethical landscape created by this "selective investigation and prosecution based on ROI" is part of the problem. We officially abandon the concept that wrong-doing will get caught and punished as a rule and then we marvel that the markets are irrational and that bad actors profit and keep profiting over large time horizons. Who could have expected such?
I think over a longer time period these effects will compound and there will be larger and larger problems. You can't just abandon the rules because enforcing them is not cost-efficient and hope everything will be alright. But it does take time to see the effects so who knows when the larger problems will show up.
In an ideal world nobody would commit a crime. Sadly we're far from an ideal world, and the US authorities in my experience are not well funded enough to adequately cover the ground they're responsible for. We also have a populace that voted for a felon who hates the IRS and has cronies who have floated dismantling the Consumer Financial Protection Bureau, so short sellers will have to do.
And the betting markets like Polymarket are worse. They had bets as to whether the fires in LA would be contained by certain dates. You can imagine the perverse incentives that creates.
the ability to spend other people's money will always be the breeding ground of corruption (which includes not doing your job while accepting the salary).
Well, the thing is, with AI being widely available the threat model explodes as the difficulty goes down drastically - imagine someone deepfaking a video of a C-level executive being involved in illegal or "extreme" sexual acts; we already have "nudifier" apps, the steps to cross for the mentioned scenario aren't that large. The number of potential threat actors explodes as the group is now "everyone with a smartphone", and it also explodes as the likelihood of getting caught (and sentenced to decades in jail, if not death) for shooting someone in public is significantly higher than getting caught "leaking" a faked video which at worst risks you a year or two for defamation.
Short sellers taking positions and then putting out report and marketing to bring a company’s price down can also be perceived as market manipulation. It’s not about people being “self important” but conflict of interest and the incentive to lie or exaggerate for those short sellers.
For example months after Hindenburg’s report on Supermicro, the independent committee investigating alleged issues found nothing wrong (https://www.morningstar.com/news/marketwatch/2024120275/why-...). The company ultimately confirmed that no prior or current financial reporting would need to be stated. So that makes the allegations false, or at least exaggerated, right? And doesn’t that mean profiteering through short positions and allegations of bad accounting would be market manipulation?
"New financial and accounting executives will be appointed, as recommended by the investigation committee"
I agree that harm is possible when short selling and lying about it.
EDIT: since I am rate limited, here’s my reply to the child comment by gmd63
> Why would an investigation committee need to recommend that a company fill vacant financial and accounting executive positions? What you're saying makes no sense.
There are many reasons this can make sense. In this case, the most likely reason is that the allegations called into question the integrity of the executives and the board. New executives would be hired and approved by the same group, and it would look strange for them to do that while under investigation. The most important finding from the investigation is neither management (executives) nor the board acted improperly, which led to them making the recommendation.
Sure, in the same sense that releasing a 10-K can be perceived as market manipulation. In fact, if we define "market manipulation" to mean anything that might affect the market, many things can be perceived as market manipulation!
The question I think is more important is, is it bad? Sharing investment information you believe to be true and material to investors seems good to me.
The mistake CrowdStrike made will likely have little to no effect on their revenue. Since the stock dropped a bit (emotional investors getting out) it became a good value proposition, so people bought it cheap.
The reasons companies use CrowdStrike haven't gone away. Existing contracts can't just be terminated. By the time it comes up for renewal few will remember the incident, fewer still will care.
What you see as "levels of incompetence" others see as "made a mistake". You don't fire suppliers for a mistake- that's experience to them, and they're unlikely to make that mistake again anytime soon.
Plus of course, replacing anything like that at scale is a lot of work, expensive, and career-risky. Who, in the enterprise, is taking on that task? Who is advocating for it?
The market is forgiving because the outlook remains strong. The outlook remains strong because the business fundamentals remain strong.
There are already lawsuits filed around this incident. If a court sides with the customers or if CrowdStrike settles them, it will not be cheap.
Even if they don't end up loosing or settling, the lawyers will not be cheap with so many suits , I don't think there is a major class action, every contract is unique after all, customers can easily afford their own lawyers and don't need to share.
Beyond that, in next renewal cycle, customers are likely to demand much stronger penalty clauses in the contract, they won't let the mistake of not putting strong financial penalties slide while they may not change the vendor. This will make insurance for CrowdStrike much more expensive, another mistake would be far more financially expensive even if this one doesn't turn out to be.
The insurer will also want a stronger internal process controls and paperwork which also won't be cheap.
Consequences in B2B are never immediate but over time they do happen, larger an org longer it takes, but eventually it does catches up, look at Intel or Boeing today.
But that is just a 'cost of doing business'. And ultimately will just work it's way into the price.
Intel and Boeing are not "one off mistakes". The root problems there are structural, cultural and fundamental.
If CrowdStrike have more issues this year, then that'll have an impact because it suggests there's a root problem. But a single bad rollout is just a bad rollout.
The "cost of business" will catchup to them is the point, Unlike Intel or Boeing it is not duopoly business with little to no options for CrowdStrike's product. It is notoriously brutal for large organizations in tech to stay competitive over 20-30 years time horizon.
Most likely trajectory for a company in their position, their growth slows - this incident being a key contributor to that slow down, then stock starts to fall, it will eventually become attractive for a company to acquire them, perhaps rebrand the product and keep the customers and cash flows.
Companies settle much faster typically to reduce some of this costs, it ends up being cheaper.
Also many of these will be resolved through their arbitration clauses that would be present in the contracts. Arbitration is much faster and usually appeal proof
The thing is, individual, one off events usually don't break a company, but the stock falls temporarially as a result of some people expecting it to. Of course, it's possible that one event breaks a company, and this is the risk you do take buying it low after the event.
And frankly unless it's criminal (Enron, Theranos etc) it's not a big deal. An oil spill here, a data leak there, these are not things that affect customer behavior.
The market is only interested in results. It doesn't care about the news. Those stock dips you see are uneducated emotional investors making bad decisions for the wrong reasons.
I think this was some years ago and it was Chipotle. They had to remove some menu items altogether IIRC.
There's a bigger question about how to properly price and penalize negative externalities. From a business perspective there isn't much difference between an oil spill and a mass data breach — "Whoopsie, we'll try not to do that again. In the meantime don't you need gas for your car?"
I think the stock market is accurately realizing that it takes a lot of effort to fire a company embedded in your security infrastructure and that the incident probably won't change sales.
Money Magazine a few years ago compared various investment strategies in stocks. The #2 best performing one was investing in the S&P 500. The #1 best performing strategy was the "dead man strategy".
The dead man strategy comes into play when the investor dies, and his estate gets frozen until it winds its way through the courts. It turns out that doing nothing with your stock investments is (statistically) the best strategy.
I know for a fact that when I do nothing with my stocks, they also perform better.
There's an even better alternative for someone willing to put in the leg work:
(1) Figure out your investment horizon. For many people, this is way shorter than suggested by generic advice, which makes some diversification beyond "stonks go up" meaningful.
(2) Figure out what costs you'll incur by rebalancing etc.
(3) Write a short script that optimises the amount of activity in portfolio management that improves performance over your investment horizon, given your costs.
Unsurprisingly, the result can vary a lot between people. The result is most likely going to involve a very low level of activity, but the process of finding it out is very informative.
What I've found out (and this is replicated also by more authoritative people like Carver) is that for almost everyone, mixing in some 10--20 % of a safer asset like 10 year bonds and rebalancing yearly outperforms a pure equity portfolio over most realistic investment horizons.
I would suggest a step beyond though, because rebalancing your portfolio is fun year 1-5, but not so fun year 5-20: have a look at e.g. Vanguard retirement target funds.
Essentially, it's an ETF with a rebalancing rule included for a specific target date. For instance if you buy the target 2050 (your hypothetical retirement age), the ETF rebalances itself between bonds/monetary fund/stocks until it reaches that date, u til it's pretty much all cash in 2050.
Lowest hassle diversified retirement scheme I found.
Rebalancing into bonds and mmmfs is a form of insurance against catastrophic losses equities. But if you have a sufficiently large account then catastrophic losses that affect your life are extremely rare, if they do occur they will likely affect your bond portfolio as well, and the expected loss vs 100% equities over 15-20 years is significant, something like 10x the value of the insurance you are buying.
If you want insurance for a large account then long-dated put options 20% of the money are much cheaper.
US large cap has certainly recently outperformed the other parts of the target date fund (international stocks, bonds). But there is certainly no guarantee that it will happen "every time". In the last 10 years, US equity has been the best overall performing asset class for the past decade but 7 out of those 10 years at least one other category outperformed it: https://www.blackrock.com/corporate/insights/blackrock-inves...
> Like pension funds I bet Vanguard is one of these so-called LPs who give money to VCs like Y Combinator to help ivy league kids follow their dreams.
You can look up the holdings of VFIFX or any other Vanguard fund. There is no private equity or private credit.
Guaranteeing mediocre performance. Not my cup a tea.
What you describe sounds like a kind of momentum/market cap investing, which is favourable in the short term, but suffers a lot when things go bad.
(This is assuming one cannot predict future returns better than the rest of the market. If you do that all the better!)
Seems like there's a lot of confusion on this. I'll see if I can get a fuller article up.
I can point couple companies that suddenly dropped from $90 a share to below $10 and then they never got up “Just eat takeaway.com” between 2018 and 2022 it was looking like they would go to the moon. In 2022 you can see hell of a drop and it is not going back.
If you would sell parts of it before 2022 you would lock at least some of the gains.
But I think you know better when to switch companies ;)
It's not easy to suppress the panic.
Most of my investing is just in passive S&P index funds, but I do occasionally buy individual shares.
Sometimes I make decent money, sometimes I lose money…turns out I consistently do worse than the S&P long term.
I treat buying individual shares as yuppie gambling at this point. It can be fun, but it’s usually a bad strategy.
Naw, that's boomer gambling.
Options are yuppie gambling.
I would actually recommend the opposite - buy shares of a few companies that you know exceptionally well. That is, not just the companies, but also the market, the industry trends, etc. Charlie Munger recommends holding 5 stocks at max, while Peter Lynch suggests industries that are tangential to your work and daily life. Both solid advice. Revisit the list every year, and you'll already do better than most of the blind duds investing in the S&P500 (which arguably contains a lot of duds).
The problem with most ETFs is that you'll still be investing in a bunch of dud companies, whose only reason for staying in the market is by virtue of being big (think HPs and IBMs, for example).
Don't just blindly buy an ETF that fits your investment goals. Many of those bespoke ETFs have 1%+ management fees.
You can look up how even a 1% fee can gobble up piles of money over years.
I know that passively-managed ETFs aren't necessarily "optimal" (as your parent comment mentioned, there's a risk of them having a few duds there for legacy reasons), but I think the value that they provide come down to the fact that they're automatically rebalanced and diversified, and 0.04% seems like a pretty reasonable cut for them doing that for me.
I think there's value in having things diversified and rebalanced automatically, especially if you don't have any confidence in your own ability to do so. Yes, you sometimes get stuff that's overvalued and thus over-represented, but in theory if the stock tanks the portfolio will be rebalanced and thus become a smaller percentage of the total holdings.
That sounds like exceedingly bad advice.
Eg I work in software (like many people here). So my career itself already heavily exposes me to ups and downs of that industry; but it's also the industry I know best. The advice you quote would see me increase my already outsized exposure to that industry ever more.
Diversification is the only free lunch in finance. Your advice rejects it.
> The problem with most ETFs is that you'll still be investing in a bunch of dud companies, whose only reason for staying in the market is by virtue of being big (think HPs and IBMs, for example).
Feel free to use the gambling money part of your portfolio to short them.
And since HP and IBM etc are publicly traded, there are already lots of short sellers around making sure the prices stay reasonable.
I call that "minimizing your gains" and "locking in your losses", and just hold instead. If I "locked in the gains" I would have missed out on 10x returns.
Of course, I did ride Enron all the way to zero (!), but it didn't matter. Think of it this way - buy 10 stocks. 3 go to zero. 6 have modest returns. 1 is a 10x winner, that more than makes up for the failures, and becomes the tentpole for your assets.
out of 10 stocks, 1 being a 10x winner is an absolutely rarity and the fact that you would manage to pick it is pure luck tbh.
- You have to be lucky enough to find it when it's cheap.
- You have to be lucky enough to hold on to it even if it loses money
- You have to be lucky enough to not sell it when it's at only 5x and hold off for the top
- you have to be lucky enough to have bought enough initially that the return is meaningful to you
These are the thoughts that made me clean up how I invest and stop thinking I'll get lucky at some point just rolling the dice. It's way more luck required than just buying in early.
Of course, the reason he didn’t buy more was because he knew it was a lottery ticket and putting most of his money in the S&P500 in his 401k was obviously more prudent.
I suppose it's dependent on your time horizon. MSFT is up around 10x since Nadella took over. It's more common over 20 years, obviously.
I'm not an IRS agent and have no idea what they mean by substantially similar. You might want to talk to your tax accountant.
They actually use the word 'identical' instead of 'similar', if that matters. It seems to be a grey area with ETFs, and I'm not a financial advisor, so won't make any further claims.
> You might want to talk to your tax accountant.
Absolutely agreed. You can also just let a reputable robo do it for you if you don't have the time or energy for it, there are multiple. It is what I ended up doing. It's modest but every bit helps.
Isn't it the case that a few large cap stocks have the vast majority of the growth? If you didn't like Tesla, didn't like Nvidia, didn't like big 5 tech, you might have had very mediocre returns.
I think DCA is the most effective investment strategy. Unfortunately I don't have the discipline to keep it up during a downturn. Next time I try it again with picked stocks will be my 4th time, but for now, I'm doing it with index funds. I'm not going to feel as inclined to pause my purchases during an index fund downturn.
If you do rebalancing then you might as well hold an ETF that does it for you at the lowest cost. If you hold individual equities, keep your winners.
The only thing a small investor can control are fees. Minimising transactions minimises fees.
Here's a similar article:
https://www.businessinsider.com/forgetful-investors-performe...
The standard advice for equities investors (at least in the UK) has been to invest in tracker funds for a very long time.
it is possible to beat the market. Many years ago I double my money in approx an year - but I invested heavily in I had been covering as a analyst (one of my previous careers) until immediately before. I am more cautious now.
How much are total costs in the US?
If you trade frequently even low brokers fees add up. If its 0.1% and you trade monthly it ends up being 1.2% over the course of an year.
Now it's effectively 0 for most common trades. Here is Schwab for example:
https://www.schwab.com/pricing
If someone is a big options trader they can probably find a better per contract price out there.
Anyone who really cares about spreads will be using limit orders. Otherwise you're talking about pennies on highly liquid shares.
The fact that we're even discussing the possible spread differences between market makers shows just how commoditized retail trading has become.
I suspect they're in the business of collecting the spread on lots of small trades that they can assume are largely random.
But yes, the market maker doesn't run the risk of trading with someone with knowledge and a lot of capital to apply it.
NBBO requires that if there is something better that Robinhood gives it to you.
If you just hold your index fund, you don't pay these recurring spreads.
They also earn some money from 'payment for order flow'.
I bet the uninvested cash product drives some weird incentives - kpis around increasing ratio of sells to buys and increasing pain around removing cash.
...No? Then, uh, a punitive judgment?
>Small fine that amounts to a cost-of-doing-business.
Ah. Hm.
It doesn't show up anywhere in your statement, but it's a real trading fee nonetheless, so it's still better not to trade too much
"Most successful chimpanzee on Wall Street" - https://www.guinnessworldrecords.com/world-records/most-succ...
At the time the bitcoins were lost, they were worth ~$575 each.
Today those returned tokens are worth close to $100,0000 each.
I doubt anyone who was affected by that hack realized they just got involuntarily forced into the best investment of their lives.
I haven't seen any reporting on that. Bitfinex, the corporate entity, is receiving the coins recovered from the feds. It's up to Bitfinex how they device to dole out those funds, if at all.
When these things happen, often times exchanges will make their customers whole by giving back the monetary value of the coins at time of loss. It's very rare they repay them 1:1 in bitcoin.
AFAIK the only crypto company who have been hacked (and there are a lot) and returned funds as BTC and not in dollars is, ironically, Mt. Gox. Users got repaid in Bitcoin 10 years after the fact. FTX bagholders were compensated ~120% in "equivalent value" dollars. Lost crypto was not repaid.
Apparently they created a token that entitles you to the lost bitcoin should they be recovered.
Because if I already need to have some stocks, than this being the #1 strategy feels like those advice that you get on the internet where if you want to be rich just get born into a wealthy family.
Statistically probably true, but not really doable. :/
I feel like you can only do the 'dead man strategy' when your already dead, since before that it's probably better to keep adding money into the portfolio.
To me they seemed like partners of shorting hedge funds (similar to CNBC) who just spit out bs articles so their hedgie friends can trade on it.
DOJ seems to agree with me?
https://www.forbes.com/sites/sergeiklebnikov/2022/02/16/doj-...
There are more and better sources.
(As always, you should trust what a founder says publicly about their company approximately not at all. If you want the answer for yourself, you gotta do it yourself, because you only know if you're lying or not. But I have my answer, I think.)
No. A good-faith failure is different from a lie.
The rule of thumb I use to handle ambiguous situations is "if my incentives were different, would I be saying something else right now?"
> Of course there are fraudsters out there, but I view most founders as rampant optimists instead of liars.
Most founders are both.
They're rampant optimists in the sense that they believe in their thing so much that it overrides all other concerns. But that often makes them liars via an argument of the form "my thing is so important and will change the world so much that I have to lie now to make sure it can be so great".
I'm not saying founders are ogres. The kind of lying they do derives from fairly ordinary human failures. But it's still lying, it's still normalized, and it still has terrible consequences all the time.
Without insider knowlege market investments are pure gamble. The best you can do is to bet randomly. Once you deviate from random bets because you are mistakenly think you know something then your investments will underperform.
Technically true. But somehow in practice you are random in worse ways. Psychology of most people makes them generate very bad randomness.
But you are right. What I said is just good first approximation. Sometimes you can do better. For example listening to most popular financial influencers and doing exactly opposite of what they recommend gives slightly better returns (it was researched). I don't quite remember if better than fully random though or just better than following their advice.
This seems like utilitarian ethics. I don't subscribe to these. I'd say most people don't either. So why "should" we calculate punishments for crimes this way if we don't use the same ethical framework as you?
Bill Hwang had settled insider trading charges a decade or so before he caused 30 billion dollars of liquidations after engaging in multiple forms of financial fraud. His insider trading punishment was likely lax and he committed crimes again, causing even more economic damage.
18 years in prison is nowhere near the amount of economic damage he caused. He amassed a net worth of 10-15 billion dollars. That's ten thousand average lifetimes worth of average American work. The punishment should reflect that. The expected value of fraud should be negative so that not even a degenerate gambler would consider it.
Can you explain your views as to why incentives to harm the economy massively via fraud to benefit yourself need to exist?
I never said that I hold that view nor do I believe it.
Between you falsely ascribing views to me I do not hold and/or lying about my words, avoiding answering my question, and your emotional manipulation, it's clear that you're a troll and I don't have any need to respond to you beyond pointing out your logical fallacies.
In particular, there seems to be substantial evidence that, at least past a certain point (and we can argue whether we are at that point or not, but it's not something self-evident either), what matters more is how likely the punishment is to be applied than how harsh it is, so increasing it further doesn't really do anything productive, just provides a public spectacle.
Can this precedent be extended to the money wasted with failed government projects? But maybe on lifetime taxes rather than lifetime earnings, to be fair.
True, although also, criminals buy things and pay VAT.
> You don't vote for criminals to take your money.
I vote for elected officials who pass bills (if I were American) that allow/disallow criminal activity.
the system incentivises this behavior, no one is punishing the rich guys playing with our livelyhood
In business, politics, everything. It almost seems like everyone is quietly agreeing that "if we pretend the pesky truth doesn't exist for long enough, we can literally change reality to be what we want".
I feel like I'm going crazy. There's no way that's how things can work for long, right?
This is what happens when bad people capture the levers of power.
When an Iraq War supporting Tory like Niall Ferguson criticizes the US military for being both bloated and stretched thin by underfunding, it gives away that the critique is just disingenuous contrarianism.
This is probably why when somebody looks to try to find the cause for e.g. the collapse of the Roman Empire there were a surprisingly large number of potentially serious issues all happening simultaneously.
The reason is that the empire probably collapsed decades before its fall and so the stupid decisions and actions all continued to pile up, seemingly without consequence. All until the inertia finally ran out and suddenly the entire house of cards came crashing down.
With Berkshire, Buffet figured out early, and firms like Hindenburg capitalized on the strategy of showing both sides of the story.
how large businesses get away with things is true across markets and the precedence set let them be more fearless to keep committing them.
the reporting through the publication has an important place, but playing the market at the same time personally gets rid of any credibility.
The amount of deceit put out into the world and gobbled up, on purpose, in business is obscene and seriously depressing. The magnitude of damage to psyches and thus economies that anyone acting in a fraudulent manner in finance creates is far-reaching and immeasurable. Punishment for financial crimes should be calculated based on the average lifetime earnings of a citizen -- if your victims are folks earning at or below the average wage, and you've scammed 100 lifetimes worth of average earnings, it's as if you've murdered 100 people.
Hindenburg's reports were a true pleasure to read, and their track record proves their positive contribution to society. Many self-important people online are quick to pounce on short sellers as being evil, and that will forever be a serious red flag to me thanks in no small part to Nate Anderson and the folks at Hindenburg Research.