The absurd media organization called CNBC today asked the question today, is Icahn boxed in to HLF? I didn’t bother to read it, because, well, the premise is inane.
Then Icahn responded by talking mad shit about Ackman.
“If anyone should feel boxed in, it’s Ackman,” Icahn said in an exclusive interview with CNBC.com.
“Ackman is an astute student of the market, as I am, and I think he would probably agree that there is very rarely, if ever, a company with the short interest, as it was just announced of 27.2 million shares of the 92 million shares outstanding. Of the 92 million, there are 20 percent to 25 percent that are closely held.”
“The only time you see the ratio very close to that is in companies that are on the verge of bankruptcy,” he added.
“Obviously, Herbalife is not anywhere near that position, and is in fact growing dramatically in countries such as China.”
“I don’t believe any professional short-sellers would ever take a position in a company with these numbers,” Icahn said. “As the old saying goes, fools will go where angels fear to tread.”
So my question to you is this: who’s boxed in, the guy with a net worth of $20 billion and permanent capital, up big in HLF, or the guy beguiled by high profile, humiliating losses, racked with terror from the specter of an Icahn led short squeeze?
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Shorting long-term is foolish for many reasons. Ackman had a chance to get out in the low 30s but is now saddled more everyday with borrowing costs on the shares.
your initial statement reeks of recency-bias
Nah, managers who short to zero are in it for the fame. Borrowing that many shares more than likely costs him extra fees daily. He wants to be a long and short guru when really his biggest accomplishment is existing after all the fuckups. If you can make even 25% on a short that’s a great trade. Theses are for longs where people can sometimes make well over 10x the investment.
Of course Icahn is boxed in. Ackman got what he wanted when the company was required to restructure the way they pay their salespeople. He was proven correct that HLF is a pyramid scheme. The company is on the verge of crumbling.
In this HLF ongoing saga, Icahn is Soros and Ackman is the Bank of England. He is gonna break that boy in two.