Don't get me wrong, David Einhorn has made a lot of money (so I've heard), however, that doesn't mean he's that smart, nor does it mean his tactics are very ethical. The mafia makes money and so do drug dealers, but that doesn't mean their business practices are something beneficial for society.
Do we really need Einhorn's activities? I don't know, but all I can tell you is that he has a long history of conducting speculative attacks against healthy firms. He shorts companies then works with his buddies in the media to disseminate negative stories so that these stocks fall. I don't see how that brings anything of value to society. It may bring a lot of value to Einhorn, but not to the rest of us.
I'll leave this discussion for another time, but if you are interested you can read this article; it shines a little light on the way Einhorn operates.
Einhorn was at the Ira Sohn Conference in New York today. That's where a bunch of big investors get together and talk about what they like and don't like in front of a live audience. Here are a few of the things he mentioned:
Einhorn says, "Norway is the only country in the world which can finance itself."
This is a totally idiotic comment. What does he mean, finance itself? Sure it can fund itself, it has its own currency. But that's not what Einhorn meant; he believes that Norway's fiscal surplus is the reason that it's the only country that can finance itself. In contrast, Einhorn believes the U.S. has run out money. Run out of dollars. This is an incredibly stupid comment.
Einhorn says China is misunderstood and is not an investment opportunity because it "doesn't have enough money to feed the economy."
Same, stupid, claim. What money does China not have enough of? Yuan? They don't have enough? Really David?
Einhorn said he didn't like Japan for reasons spelled out by that "brilliant" mind, Kyle Bass (the guy who's sucking major wind on his gold position) and Andy Xie reasons. The latter says Japan is going to become insolvent and the yen is going to crash.
The Three Stooges.
By the way, Einhorn did say he loves Apple (shocking!) and is long nearly $1 bln worth of the stock.
Apple's probably a major short!