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Elon Musk vs. Short sellers
- Thread starter jesselivenomore
- Start date
ValueAnalyst
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You would be surprised at how many people do actually click on a link included in an article or a tweet, let alone read it, let alone join the platform.
Short-selling subtracts exaggerated upward movement. It is well established that short selling is a way to bring information to the market (i.e., the stock price) when that information is had only by people who are not long. They bring that information to the market by borrowing, and then selling the borrowed shares. Now the market has that information. The supply of the shares goes up, the price goes down. The market benefits from that information by averting a bubble -- more accurate market prices have positive externalities.
The short sellers in the case of Tesla have had two functions: one good and one bad. To some extent, they have averted a bubble in Tesla shares: even if Tesla succeeds wildy, its discounted future cash flow isn't infinite, and therefore its current stock price should have some cap. The short sellers help inform that cap and help moderate the rise as future projected cash flows are converted to real cash flows over time.
The second function that some short sellers do is bad -- they try to manufacture and exploit misinformation. Sometimes they do it based on a hunch of actual information or suspected accounting misdeeds, but then to drive their thesis, they manufacture more misinformation. That part of short selling is bad, is well described in the OP, but it isn't intrinsic to short selling -- It is just a common artifact and practice of some people who engage in dishonest selling either long or short.
See https://cowles.yale.edu/sites/default/files/files/pub/d14/d1413.pdf
persuasively showing and then concluding "We have shown that short selling serves a socially useful function, whether the market operates rationally or is dominated by noise traders. Generally, then, regulators should permit short sales to the same extent as “longs.” Regulation may be needed to prevent market manipulation and panics, but any constraint on short sales should be narrowly tailored to these concerns and should also apply to long positions."
Honest short selling brings price information to the market, averts bubbles, and results in less volatility.
But the temptation for so many short sellers to engage in misinformation or outright stock manipulation and interference with business relations is too great for some -- especially when they are staring into a dark abyss of covering a rising stock.
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MODERATOR:
Yes, this thread has been derailed. This Mod is as culpable as others, and will clean it up...probably...later today.
Yes, this thread has been derailed. This Mod is as culpable as others, and will clean it up...probably...later today.
This thread has officially gone off the rails.
Blame Elon, the baddest shitposter of them all
You’re aware that your screen name revolves around ‘elon’, don’t you schonelucht?Blame Elon, the baddest shitposter of them all
Blame Elon, the baddest shitposter of them all
@schonelucht IS Elon............Off topic....yes...but Audi has not done clean up yet.
Me thinks when Elon references a thread is deserves to descend at least a little bit in chaos.
The question is, was Montana acting for himself or his boss. This is an older article about Stewart.
It's also not clear how the connection was made, though the description matches.
Guns, Girls And Sex Tapes: The Unhinged, Hedonistic Saga Of Billionaire Stewart Rahr, 'Number One King Of All Fun'
The Stewart J. Rahr Foundation
I knew his identity back in June . Apparently, many other people did too. I will just say that Seeking Alpha contributed to his downfall.
Also, my original post need to be amended.. Montana does have oil connections and he is not harmless.
The real question for me is why Seeking Alpha allowed him to write dishonest pieces with verifiably false statements of fact under an assumed name without disclosing his conflicts of interest. Does not speak well of Seeking Alpha. It's obvious why he was using an assumed name: didn't want his mudslinging to affect his career.
i would suggest we move on as montana is an object of the dimly receding past, a footnote of a dying industry, thrashing about
I haven't read most of what he writes. But he writes from the perspective of a litigator who's client is the Tesla short position.
As a blogger he can write what he wants as long as he stays away from liable. If he was a competent attorney he certainly considers the potential blowback from what he writes.
The majority of SA articles have verifiable errors. But I don't see the issue with Montana as so much errors but extreme spin and fallacy. On the flip side the same thing happens on TMC forums hourly. But its done within forum rules so it is acceptable.
And I think that is expected of short sellers. I mean, what do you do after placing a huge bet that a company will fail? You are not going to sit idle and hope that it will happen. You need to work towards your goal and that means spreading rumors and outright lies through established media channels and social media. And the journos of these outlets - CNBC, Bloomberg, Business Insider, Seeking Alpha, et all are ready to pimp for them. They will pimp for anyone, even for Elon if he is willing to part with his money for advts.
Simple. Clicks that gets ad revenue. They will print anything as long as it gets clicks.
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