Having already made his millions on credit-default swaps, David Einhorn wants to see a last call on the controversial derivates.
In his recent speech to the Value Investing Conference, the Greenlight Capital founder lambasted CDS, blaming them for a whole array of social problems and calling them a slippery slope toward Stalinism. What to do with such a social virus? Stamp it out.
“I think that trying to make safer credit-default swaps is like trying to make safer asbestos,” Einhorn said. Quite a statement from one of the hedge fund chieftans who earned the ire of many a Wall Street CEO during the height of the financial crisis, in effect agreeing that CDS are un-American.
Un-American and deeply red, the Cold Warrior claims. Even a CDS clearinghouse won’t do the trick, because that would simply create “socialized risk.” And with socialized medicine on the horizon, we can’t afford to turn Wall Street over to the pinkos.
Hammering home the point that CDS are simply the back door to the U.S.S.A., Einhorn calls them “anti-social,” and he should know. Investors like him “have an incentive to use their position as bondholders to force bankruptcy,” rather than some more capitalistically constructive end.
Posted by guest , Nov 06, 2009 5:10PM
Agreed. Ban all CDs. Go back to cassette tapes - "Party Mixes" were so much cooler when they took time and effort, rather than just creating an IPOD playlist . . .
Posted by guest , Nov 06, 2009 5:11PM
photo fail
Posted by Anal_yst , Nov 06, 2009 5:15PM
did einhorn go soft? what a p*ussy.
Posted by red light capital , Nov 06, 2009 5:19PM
You can see his whole speach here: http://www.scribd.com/doc/22181407/Green-Light-Capital-Einhorn-s-Speech-at-Value-Investing-Conference-Oct-2009
Posted by guest , Nov 06, 2009 5:19PM
CDSs may yet prove to be capitalism's bane.
Just keep on doing what you're doing Wall Street, and eventually, you will put the death f*ck into the harlot who spawned you.
The Guy from Delaware
Posted by guest , Nov 06, 2009 5:19PM
Sazar,
Watch out, you're going to feel the ire of the Wall Street limousine liberal brigade in 3..2..1..
Posted by guest , Nov 06, 2009 5:21PM
The graphic rawks!
Posted by guest , Nov 06, 2009 5:22PM
Greg
I'm taking a little time off, but reachable by cell and checking my e-mail from time to time. For urgent matters, please contact the real Jeff Macke.
Not Jeff Macke but a fan of his work
Posted by guest , Nov 06, 2009 5:23PM
@4 this was from an investor letter, not a presentation.
Posted by guest , Nov 06, 2009 5:27PM
"At quarter end, the six largest disclosed long positions in the Partnerships are Arkema, CIT Group debt, Ford Motor Company debt, gold, Lanxess and Pfizer. The Partnerships had an average exposure to equities and fixed income (excluding credit derivatives, gold and foreign currencies) of 99% long and 59% short."
Posted by guest , Nov 06, 2009 5:29PM
Funny, but while people have been bitching for a few years about the CDS market, it seems to have quietly fixed itself without regulation and is functioning fine . . .
Posted by Tax Chick , Nov 06, 2009 5:31PM
My theory is that Einhorn has come up with CDS lite and is planning on eviscerating his competitors by baning CDSs and using his own version to suck the marrow out of the market.
Posted by Anal_yst , Nov 06, 2009 5:34PM
@tax chick
I'm with you here, there's definitely no benevolence here, no selflessness whatsoever.
Posted by red light capital , Nov 06, 2009 5:41PM
@9 sorry kiddo, but it was from his speech at the value investing conference...check the transcript
Posted by guest , Nov 06, 2009 5:42PM
Finkel and Einhorn...Finkel and Einhorn........Einhorn is finkel. Finkel is Einhorn. Einhorn is a man. EINHORN IS A MAN!
Posted by red light capital , Nov 06, 2009 5:44PM
@ 9 -- seems we are both right. Well, it's nice to know the guy recycles (words).
Posted by Subprime All Star , Nov 06, 2009 5:54PM
The only furniture store with CG's imprimatur:
http://www.romafurnitureli.com/index-5.html
Posted by Jimmy , Nov 06, 2009 6:06PM
Bond puts?
Posted by trojan , Nov 06, 2009 6:13PM
@6
open up the dictionary to "Sarcasm"
Posted by Tax Chick , Nov 06, 2009 6:17PM
@trojan - have to come up with an exotic name:
debt arbitrage notes (DANs)
reverse equity securities (RESs)
contra arbitrage notes (CANs)
CANs will probably win with this crowd.
Posted by trojan , Nov 06, 2009 6:47PM
@tax chick
i like your CANs
Posted by guest , Nov 06, 2009 9:22PM
Bess has sex 10 times a month.
.
over/under -- Discuss
Posted by guest , Nov 06, 2009 9:57PM
@22, Bess doesn't have sex you idiot, sex has her.
Posted by guest , Nov 06, 2009 11:21PM
@22 over.
-guy who would know
Posted by guest , Nov 07, 2009 11:25AM
Einhorn?
Pitching coach for the Yankees?
A World Series and he's had coitus with Bess?
That's big. Really big.
Posted by merkin capital partners , Nov 07, 2009 1:51PM
@16 This makes at least the 3rd time. He gave the same speech (verbatim) at the Dallas Great Investors Best Ideas forum on Oct 6th.
Posted by guest , Nov 07, 2009 6:23PM
@25 uh what?
Posted by guest , Nov 09, 2009 11:46AM
Wait, wouldn't a safe version of asbestos be a good idea?
Posted by guest , Nov 09, 2009 12:26PM
@18, that's crazy talk!