David Einhorn thought 2017 was bad. He thought, perhaps, that it couldn’t get worse. After all, he got divorced, hammered by redemptions, mocked and ridiculed, and was forced to watch the continued deification of a man he knows to be a charlatan and fraud.
But he was wrong. Sure, the Mets weren’t as bad in 2018 as in 2017, but somehow they felt worse. Elon Musk had a series of public meltdowns, and it didn’t—and doesn’t—matter. Aspirin gave him a headache. His best idea of the year was shorting a mid-sized bond insurer. Oh yea, and in 2017, he actually made money. In 2018? Not so much.
Greenlight Capital's main fund lost 9 percent in December, bringing its decline for 2018 to 34 percent, the worst performance since Einhorn started the firm in 1996…. Einhorn's hedge funds underperformed the market drastically — the S&P 500 ended 2018 down just 7 percent.
After 2017’s disappointments, Einhorn pledged to stay the course, no matter what the cost. Now, however, those costs have been tallied, and they are, uh, quite high. Einhorn has, in effect, said a portfolio that lost a third of its value last year is who he is. We’d say he might want to consider hanging them up and going back to the poker tables, but that’s not working out so well, either. Has the Green Lantern reached his nadir? Or are there further depths to plumb before a triumphant rebirth (or not)? We watch with growing concern.