OK,
regarding shorts:
I don't have any empirical data about shorts being more successful than longs, but when you consider that they are in effect swimming against the tide (shorting requires interest, and the presumption is that any random stock will go up about 5-10% per year), you'd expect that if they're even modestly successful, they'd need to be right about their stocks going down. It may be that shorts in general do really badly, of course.
regarding RMBS:
You wrote "Look at Rambus. That was like 50% of the float. A mutual fund manager said he was telling everyone he knew to short Rambus. You can agree or disagree on whether Rambus was been a success from a business point of view, but the company is still around and doing more in sales today than in 1999. Umm..the shorts were wrong."
Not to put too fine a point about it, but dude... have you looked at a RMBS chart lately? Understand that I bought RMBS at 40, and it was easily the worst "investment" i've ever made, so I'm hardly bragging, but man alive, if that's the best counter-example you can come up with, you should keep looking. For the record, RMBS was at 23 at the beginning of 1999, and it's about 6 now (and headed for worse, IMO). Hey, the RMBS shorts were jerks, but they did pretty well (as did the momo longs who got out at the top of course, but the LTBHers got slaughtered).
regarding ELON:
Yeah, I just checked, the estimates of PE go through the roof for the next couple of years. That's nice to see, to be sure, but the negative cash flow is also relevant. I really don't know the ELON story that well, so I can't speak to the "quality" & sustainability of those earnings long term.
Ethan |
