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A SVB short seller explains red flags he saw months ago

fortune.com

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Re: A SVB short seller explains red flags he saw months ago

#71

Post by zamnos »

DeathArrow wrote: post #58
spaceman_2020 wrote: post #17

Earlier quoted context omitted.

At this point, I'd believe the conspiracy theory that Cramer saying something public is a secret signal to those in the know.

I am not from US, what is the story? Does that guy consistently make bad predictions?

The background on Jim Cramer is less about his accuracy and more about his tv show. He has this show where he just goes off on what to buy and what to sell, on a major news network, from before YouTube, and it's enthralling. If we were to do a montage scene of America and capitalism, he'd be in it, yelling BUY! SELL! BUY!

it's just so over the top! if you haven't seen it before here's a recent one https://youtu.be/RKG0Qh51Vq0

Re: A SVB short seller explains red flags he saw months ago

#72

Post by junon »

notafraudster wrote: post #42
scscsc wrote: post #28

Could anyone in the know explain how "shorting" works?

When you buy a stock, you pay money and someone else gives you a stock. Once you have it, you can hold it for as long as you want. Its value can go up or down. When you sell, you get money, which might be less or more than what you paid. If the value goes to zero, you can no longer sell and you will never get any money. When you short a stock, you are basically selling a stock you don't have. Thus you get money and o…

This is the clearest explanation I've ever read of this. Thank you.

Re: A SVB short seller explains red flags he saw months ago

#73

Post by thiscatis »

skmurphy wrote: post #65
paulpauper wrote: post #48

Bleecker Street Research, of course, has made out quite nicely from the demise of Silicon Valley Bank (The team won’t comment on how much they made off their short bet). How much could it be? 60-70%? That is how much the stock fell. The problem with these kind of stories is you don't hear about all the times these firms sold short and or were wrong or lost lots of money before eventually being right and would have be…

Regulators took over SVB: trading was halted. It's unlikely stockholders will get more than a few cents per share so it's a 99.9% drop. The story was interesting because they explained how the bank got into such a bad situation that regulators had to take it over.

What happens with short positions when something like this happens though? The firm is going to be liquidated so where would the shorter buy back the stocks to give back if they haven't exited by now (trading was halted)?

Re: A SVB short seller explains red flags he saw months ago

#75

Post by DeathArrow »

JumpCrisscross wrote: post #61
DeathArrow wrote: post #60

Earlier quoted context omitted.

In the case you short a bank, why not borrow the money from the same bank?

> why not borrow the money from the same bank? That loan is the bank’s asset. It doesn’t go away when the bank collapses.

I know, but it would be funny.

Re: A SVB short seller explains red flags he saw months ago

#76

Post by vsnf »

smcl wrote: post #64
DeathArrow wrote: post #57

Earlier quoted context omitted.

Thanks, I will short JP Morgan ASAP.

I don’t think what you should take from this is “always do the opposite of what Cramer says”. Rather that you should not consult him at all when you’re deciding how to invest your money.

See also, this amazing gem from the FT last year[0]:

> In a previous Alphaville post we may have implied that Jim Cramer’s peak-inflation call was a reverse indicator for our readers. We regret the error. It was not our intention to give Cramer’s opinions any credence whatsoever.

[0] https://www.ft.com/content/3d1601e0-62b5-4cd5-b298-67f6f1f43...

Re: A SVB short seller explains red flags he saw months ago

#77

Post by skmurphy »

thiscatis wrote: post #73
skmurphy wrote: post #65

Earlier quoted context omitted.

Regulators took over SVB: trading was halted. It's unlikely stockholders will get more than a few cents per share so it's a 99.9% drop. The story was interesting because they explained how the bank got into such a bad situation that regulators had to take it over.

What happens with short positions when something like this happens though? The firm is going to be liquidated so where would the shorter buy back the stocks to give back if they haven't exited by now (trading was halted)?

from https://www.investopedia.com/ask/answers/maintain-short-posi... When an investor has a short position in a company that gets delisted and declares bankruptcy the investor never has to pay back anyone because the shares are worthless. The short seller owes nothing. That is the best possible scenario for a short seller. Eventually, the broker will declare a total loss on the loaned stock. At that point, the broker cancels the short seller's debt and returns all collateral.

Re: A SVB short seller explains red flags he saw months ago

#78

Post by sidlls »

DeathArrow wrote: post #58
spaceman_2020 wrote: post #17

Earlier quoted context omitted.

At this point, I'd believe the conspiracy theory that Cramer saying something public is a secret signal to those in the know.

I am not from US, what is the story? Does that guy consistently make bad predictions?

It's not about his predictions, but his admitted market manipulation. I don't know how "in the know" he is now, but all you need to know about his motivations is encapsulated in the first minute of this interview: https://www.youtube.com/watch?v=8DJlogbrDcA.

He's a market manipulator, or was when he was in that hedge fund, and there's every reason to believe that he still would do this now for his own personal benefit if he could. Basically, if he's promoting a position it's probably a really good idea to strongly consider taking the opposite one, or just ignoring it (which is likely the better idea).

Re: A SVB short seller explains red flags he saw months ago

#79

Post by boosting6889 »

DeathArrow wrote: post #58
spaceman_2020 wrote: post #17

Earlier quoted context omitted.

At this point, I'd believe the conspiracy theory that Cramer saying something public is a secret signal to those in the know.

I am not from US, what is the story? Does that guy consistently make bad predictions?

60% of the time his predictions work out every time

Re: A SVB short seller explains red flags he saw months ago

#80

Post by selimthegrim »

itissid wrote: post #24
mike_d wrote: post #5

This is all you needed to know to short SVB a month ago: https://twitter.com/WatcherGuru/status/1634246217226919937

I remember how Jon Stewart on the Daily show made fun of him about getting predictions for Bear Sterns wrong and got under his skin when the financial crisis of 2008 was afoot.

He did take it very well IIRC and put his game face on
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