Michael Burry of ‘The Big Short’ reveals a $530M bet against Tesla • Hacker News Board

Re: Michael Burry of ‘The Big Short’ reveals a $530M bet against Tesla

#71

Post by gruez » Mon, May 17, 2021, 7:16 PM UTC

fastball wrote: post #49

boringg wrote: post #28

Earlier quoted context omitted.

Actually, this will likely be unpopular here, short sellers do have an important role in the economy. In the case of GME and more recently short sellers have been making money on crushing viable businesses (which they should not be allowed) but historically they expose fraudulent companies. I don't like companies getting pushed out of business by big short sellers or making money but just publishing bad research unde…

People keep saying this but I'm still not sure I buy it. Everyone in the finance industry has some excuse for why their particular gig deserves to exist (HFT / hedge funds / shorts) but economics are complex and having a plausible-sounding reason doesn't mean it actually does help the economy / markets function in the long run. Do you have any examples of shorts actually help uncover fraud? Or is it more just when th…

>Do you have any examples of shorts actually help uncover fraud

just from recent memory:

1. Muddy Waters Research reporting on Luckin Coffee

2. Hindenburg Research reporting on Nikola

3. Citron Research reporting on Valeant Pharmaceuticals

Re: Michael Burry of ‘The Big Short’ reveals a $530M bet against Tesla

#72

Post by tenpies » Mon, May 17, 2021, 7:16 PM UTC

paxys wrote: post #10

The only new reveal is the dollar figure. Burry has been very openly (and vocally) short on Tesla for a while now. He has been Tweeting a bunch about it since September last year. Tesla shares are up ~75% since those original Tweets. "The market can remain irrational longer than you can remain solvent" applies to both amateur traders and the most seasoned investor/genius alike.

Oh you're completely missing the nuisance of what we just learned.

Sure, he's been talking short since September, but the size of his position has grown considerably since then - almost certainly timing the S&P inclusion (sorry index investors, you quite literally paid the top price for a stock that has lost almost 45% since you bought it).

He's almost certainly made a killing with his position and the beauty is we don't even know what it is today. He could have realized hundreds of millions in gains, or he could have them all still open.

If he has the position from the filings - just today, when Tesla is down $22 - he has made over $16 million dollars in unrealized gains.

It will be hilarious watching the Musk Zealots crying to have Elon tweet something to fraudulently try to pump the stock price and try to trigger a squeeze. Meanwhile they don't realize he's doing this with options, not shorting directly.

Re: Michael Burry of ‘The Big Short’ reveals a $530M bet against Tesla

#73

Post by iamadog1 » Mon, May 17, 2021, 7:16 PM UTC

cryptoz wrote: post #39

turbinerneiter wrote: post #15

Teslas price is just too high. I think they will be very successful and become a big, dominant car maker. But their price only makes sense if they end up being the only car maker left. That's not realistic. Building an electric car is not that hard, especially if Tesla already did all the hard lifting for you. For a while I was thinking that the battery play - becoming the number 1 battery supplier - will justify the…

Tesla isn't a car company, though. They even removed "Motors" from their name years ago - showing wider interest, and not just batteries. Solar roofing as well, and others. I don't hold TSLA right now, regretfully, I entered pre-split at $27 and sold at $200. I also think the current price is way too high, for what it's worth. WAY too high. But it's not at all about cars, at least not for me, when trying to justify t…

The P/E is probably still skewed. They're accounting for the robotaxi windfall which is leveraging their buyback program, kind of ridiculous considering the constant delays and skepticism surrounding their fully autonomous system and then you've got to consider the regulatory hurdles that are inevitably going to develop after deployment.

Re: Michael Burry of ‘The Big Short’ reveals a $530M bet against Tesla

#74

Post by overhero » Mon, May 17, 2021, 7:17 PM UTC

patorjk wrote: post #64

> Besides his “Big Short,” Burry made a killing from a long GameStop position recently as the Reddit favorite made Wall Street history with its massive short squeeze. Except I remember reading that he sold for before the price exploded [1]. So although he made a profit, he missed out on the squeeze because he sold too early. [1] https://markets.businessinsider.com/news/stocks/big-short-mi...

he was not wrong though, just too early

Re: Michael Burry of ‘The Big Short’ reveals a $530M bet against Tesla

#75

Post by akomtu » Mon, May 17, 2021, 7:18 PM UTC

turbinerneiter wrote: post #15

Teslas price is just too high. I think they will be very successful and become a big, dominant car maker. But their price only makes sense if they end up being the only car maker left. That's not realistic. Building an electric car is not that hard, especially if Tesla already did all the hard lifting for you. For a while I was thinking that the battery play - becoming the number 1 battery supplier - will justify the…

I'd think of Tesla as of an iPhone for affluent hipsters. Teslas remain connected to the manufacturer that collects extensive info on drivers (spying, some would say) and can use it for marketing or other purposes later. Teslas can be a powerful distribution channel if Musk figures a way to discreetly advertise to them right in their cars. Teslas are a golf club in a sense: a directory of important people, except that the club has managed to install mics, gps trackers and a internet connected screen right in the members' cars.

Re: Michael Burry of ‘The Big Short’ reveals a $530M bet against Tesla

#76

Post by Shacklz » Mon, May 17, 2021, 7:18 PM UTC

turbinerneiter wrote: post #15

Teslas price is just too high. I think they will be very successful and become a big, dominant car maker. But their price only makes sense if they end up being the only car maker left. That's not realistic. Building an electric car is not that hard, especially if Tesla already did all the hard lifting for you. For a while I was thinking that the battery play - becoming the number 1 battery supplier - will justify the…

> I think they will be very successful and become a big, dominant car maker.

"Big, dominant" in the same sense as maybe Ferrari: Prestigious cars for a niche audience that are willing to pay a premium for the brand.

Re: Michael Burry of ‘The Big Short’ reveals a $530M bet against Tesla

#77

Post by cosmojg » Mon, May 17, 2021, 7:18 PM UTC

This guy has been wrong a lot recently. Admittedly, he was right once and in a big way. However, remember that success is mostly luck, and this is orders of magnitude truer for success in public markets.

Outside of entertainment, it isn't worth the time to follow celebrity investors.

Re: Michael Burry of ‘The Big Short’ reveals a $530M bet against Tesla

#78

Post by paxys » Mon, May 17, 2021, 7:20 PM UTC

tenpies wrote: post #72

paxys wrote: post #10

The only new reveal is the dollar figure. Burry has been very openly (and vocally) short on Tesla for a while now. He has been Tweeting a bunch about it since September last year. Tesla shares are up ~75% since those original Tweets. "The market can remain irrational longer than you can remain solvent" applies to both amateur traders and the most seasoned investor/genius alike.

Oh you're completely missing the nuisance of what we just learned. Sure, he's been talking short since September, but the size of his position has grown considerably since then - almost certainly timing the S&P inclusion (sorry index investors, you quite literally paid the top price for a stock that has lost almost 45% since you bought it). He's almost certainly made a killing with his position and the beauty is we d…

From the article:

> As of March 31, Burry owned 8,001 put contracts, with unknown value, strike price, or expiry, according to the filing.

So what are you basing any of this on?

Re: Michael Burry of ‘The Big Short’ reveals a $530M bet against Tesla

#79

Post by [deleted] » Mon, May 17, 2021, 7:21 PM UTC

awb wrote: post #12

It sounds like the short thesis is centered around Tesla’s revenue coming in large part from regulatory credits. If you take out credits and crypto, they look like most other car manufacturers, struggling to make a profit. > As more automakers produce battery electric vehicles of their own, ostensibly fewer will need to purchase environmental regulatory credits from Tesla, which they have done in order to become comp…

[deleted]

Re: Michael Burry of ‘The Big Short’ reveals a $530M bet against Tesla

#80

Post by epistasis » Mon, May 17, 2021, 7:22 PM UTC

tenpies wrote: post #72

paxys wrote: post #10

The only new reveal is the dollar figure. Burry has been very openly (and vocally) short on Tesla for a while now. He has been Tweeting a bunch about it since September last year. Tesla shares are up ~75% since those original Tweets. "The market can remain irrational longer than you can remain solvent" applies to both amateur traders and the most seasoned investor/genius alike.

Oh you're completely missing the nuisance of what we just learned. Sure, he's been talking short since September, but the size of his position has grown considerably since then - almost certainly timing the S&P inclusion (sorry index investors, you quite literally paid the top price for a stock that has lost almost 45% since you bought it). He's almost certainly made a killing with his position and the beauty is we d…

> (sorry index investors, you quite literally paid the top price for a stock that has lost almost 45% since you bought it).

If there's a single index investor that feels saddened by this stat, in the slightest way, they should stop index investing right now. The great joy of index investing is that this single stock is down, while on average everything else is way up...