Seeking Alpha

Einhorn warns on tech bubble

  • "Our second tech bubble in 15 years," is how David Einhorn - writing in his investor letter - describes the current period. While shorting a number of high-fliers, Einhorn has limited those "dangerous" bets. “What is uncertain is how much further the bubble can expand, and what might pop it."
  • Greenlight Capital lost 1.5% in Q1, and shorts like Green Mountain and Chipotle haven't panned out. Greenlight Capital RE (GLRE) is off 7.5% YTD.
  • Earlier: Greenlight throws in the towel on Chipotle, goes long Conn's.
  • ETFs: QQQ, PSQ, TQQQ, QID, SQQQ, QLD, QQEW, QQQE, QQXT, TNDQ
Comments (4)
  • ssouligne
    , contributor
    Comments (4) | Send Message
     
    No way, a bubble?!?!
    22 Apr, 03:52 PM Reply Like
  • bgold1955
    , contributor
    Comments (1943) | Send Message
     
    Link doesn't mention any specific corps so it's difficult to even understand where he is coming from on bubble deal. Agree that there are some very high valued stocks but generally, not so sure. Perhaps he will explain subsequently.
    22 Apr, 04:24 PM Reply Like
  • King Rat
    , contributor
    Comments (571) | Send Message
     
    Indeed. Even the highest market cap stock AAPL, could drop from 700 to 400 without affecting the market much. So if only 5-10 big names are "in a bubble", then we are not talking about a systemic risk situation.

     

    If he means there are millions of highly leveraged investors betting their banks' last pennies on 300 tech companies that have no revenue and no tangible assets, and those banks have margin calls coming, well that's another story.

     

    When a man who has lost billions of dollars of OPM betting "risk-on" pedal to the medal, it is confusing to understand what he means when he suggests "risk off" is the way to go.

     

    Does that mean he has learned his lesson or just still does not know what he is talking about?
    22 Apr, 05:00 PM Reply Like
  • paulschinider
    , contributor
    Comments (2) | Send Message
     
    "Smart" (early) investors are waiting for that "stupid" money (late investors) to come pouring in on a wave of hype and fanfare. The bubble is welcomed and well-anticipated by the savvy. It's popping will once again "top-line" the industry as the inevitable consolidation begins. Rinse and repeat. Cycles. http://bit.ly/1itl6Cq
    28 Apr, 04:55 PM Reply Like
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