I've ironically lost more money the more closely I've paid attention to my investments because I was naively confident in the market's ability (or as I've come to suspect, willingness) to react to evidence of fraud.
The amount of deceit put out into the world and gobbled up, on purpose, in business is obscene and seriously depressing. The magnitude of damage to psyches and thus economies that anyone acting in a fraudulent manner in finance creates is far-reaching and immeasurable. Punishment for financial crimes should be calculated based on the average lifetime earnings of a citizen -- if your victims are folks earning at or below the average wage, and you've scammed 100 lifetimes worth of average earnings, it's as if you've murdered 100 people.
Hindenburg's reports were a true pleasure to read, and their track record proves their positive contribution to society. Many self-important people online are quick to pounce on short sellers as being evil, and that will forever be a serious red flag to me thanks in no small part to Nate Anderson and the folks at Hindenburg Research.
Keep in mind, fraud isn't necessarily a big deal for the shareholder, not all fraud is Enron-tier. For example, I fully believe they were right about Adani, but it was basically just skimming money off the top. If Adani is an embezzler, but also good and funneling bribes to get gov't contracts, then the overall effect on profits may just be breakeven or even positive. The losers would be the Indian citizenry. The company isn't doing so well now possibly due to a culture of corruption, but that kind of long-term culture analysis is hard for traders. But generally, fraud isn't severe enough to enough to endanger the company, it's just taking some money out of shareholders' pockets, but dispassionate traders don't usually sell out of retaliation.
True. Small frauds are common. I know people that have gotten away with pump-dumps. I know people that have raised obscene money for terrible ideas. I even helped close one customer while at one company, and then when I moved to another company, I had to meet the same buyer and he chewed me out in front of my rep because of the shady deal from my last company. And I even had a customer that kinda defrauded us! And when I was younger, I saw a lot of tiny behaviors that might be considered fraudulent if looked at from the angle of a transaction. I had to stop working for a while because it was destroying my soul. Nate says there was no danger or specific reason to close, but I very much doubt this.
The market can remain irrational longer than you can remain solvent. The market will tolerate infinite BS for arbitrary periods of time.
Which also means being careful of short selling. It can put you at unlimited risk even if you are absolutely right.
> Which also means being careful of short selling.
There are a number of businesses I know are badly run and will eventually fail, but I cannot find a way to monetize that safely without knowing the timeline for failure.
> It can put you at unlimited risk even if you are absolutely right.
The risk is in borrowing, not short selling. How many momo jockies out there think about the "unlimited risk" from buying Tesla on margin? In that case, you're shorting USD, but no one talks about that because it always will be fashionable to short USD.
Just like it always will be fashionable to short JPY, for carry and more. Until it's not.
You can short USD by buying Bitcoin or a similar non-correlated asset but how could buying a usd correlated asset (TSLA) be shorting?
Stocks are generally not considered tied to currency- if the company has some fundamental value, that should be inflation proof.
So technically buying almost any stock can be a way of shorting the USD in that you are selling it now and will buy it back later.
The risk - besides that of the company itself- I suppose is that if you have massive deflation you will end up with less USD. I don’t think anyone is worried about massive deflation of the USD, since the Fed can and would prevent that.
This is a common thing among investment professionals especially in areas where you need strong domain knowledge such as biotech. Your conviction can become stronger the more you learn and collect supporting data. Conviction is a dangerous thing. This also extends to what’s broadly happening today in increasingly data-rich environment because we make data-dependent decisions.
I won't name names but a very popular so called "app growth king" launched recently and it's just full of dark patterns. Even going so far as giving out a "free month", when it's just a way for the user to lock into a yearly plan after a one month trial.
Isn’t that virtually every (mobile) subscription app in existence…?
> Many self-important people online are quick to pounce on short sellers as being evil, and that will forever be a serious red flag to me thanks in no small part to Nate Anderson and the folks at Hindenburg Research.
Credible arguments can be made however that short-selling itself, especially naked short selling, is an unethical thing to do as the pure possibility of short-selling makes some forms of crime possible in the first place, such as a criminal shooting up the road bus of a German soccer team to profit from falling stock prices [1]. Especially in the era of anything being credibly fake-able with widely available AI tools, short-selling can look to criminals as a very profitable way to make money.
Also, short-selling incentivizes large stock holders to be lazy and not do their jobs. Imagine a huge ass pension fund - they can (and do) make money as the counterparty in short-selling deals. Some see this as a necessary part of stocktrading life (because it provides liquidity), but personally I think that it removes incentives for the pension fund managers to do their job and audit the stock they hold for their shareholders in turn themselves.
Besides: enforcing securities code and auditing companies should not be the job of vigilantes. I applaud the efforts of ethical short sellers, but in an ideal world, that job would be done by the authorities.
[1] https://de.wikipedia.org/wiki/Anschlag_auf_den_Mannschaftsbu...
1. Naked short selling basically doesn't happen anymore. To the extent that it does happen it's a mere technicality and the borrow is found after a couple of days.
2. There is very little money in shorting. Pumping and dumping by making up positive news is much more lucrative. "to the moon" has been a trope for years, and there is no equivalent on the short side. Even the world's most successful short seller Jim Chanos was successful because the short portfolio functioned as a hedge that enabled a leveraged long position on broad indices. It's pretty hard make money net short when the market goes up for two straight decades.
3. The authorities don't have the resources nor the dogged inclination to hunt down fraudsters. The authorities can't and shouldn't base an exhaustive investigation on vaguely shifty CEO behavior. Short sellers can and do start their investigation based on gut feeling.
I completely agree about the dangers and am disgusted by the story you shared and others like it.
In an ideal world nobody would commit a crime. Sadly we're far from an ideal world, and the US authorities in my experience are not well funded enough to adequately cover the ground they're responsible for. We also have a populace that voted for a felon who hates the IRS and has cronies who have floated dismantling the Consumer Financial Protection Bureau, so short sellers will have to do.
And the betting markets like Polymarket are worse. They had bets as to whether the fires in LA would be contained by certain dates. You can imagine the perverse incentives that creates.
Truly perverse incentives such as one the one you linked aside I think it's mostly fine. Naked short selling is already illegal and the deck is heavily stacked against short sellers to begin with. A position betting on growth is by far and away the safest investment, the market directly incentivizes "irrationality" on the side of prices not going down, and it's infeasible to hold a short position for very long making it (mostly) noise to long term investors which are the ones we typically care about.
"just feeling like it" seems insufficient explanation for dismantling a successful organization rather than transitioning it
they just completed their "pipeline of ideas" with "the last Ponzi cases" - seems like a surprisingly clean and abrupt end for an investigative organization
the team members are "brilliant" and "family to me" but heis disbanding rather than transitioning leadership
He mentions some team members are starting their own research firm but he "will have no personal involvement" That emphasis seems noteworthy
Claims there's "no particular threat" but takes pains to emphasize this multiple times
instead of maintaining the organization and training successors directly, he's planning to release videos and materials about their methods
No mention of the firm's financial position or client relationships
Not buying it, there's a story but it doesnt seem like he wants to tell it
Honestly? That feels like a more genuine explanation. Business say they reasons for doing things, but I've not seen a high level decision maker that isn't eventually just "going with his gut."
At least they're honest here.
Is this a decision to avoid litigation? I’ve seen people post analyses that disprove Hindenburg’s claims. And recently Supermicro’s independent auditors didn’t find the same issues Hindenburg claimed. Is it possible they’ve basically got rich from misleading attacks on stocks and are now shutting down to avoid something bad? Basically cashing out on their short positions?
I got the same impression.
I assume they have a good reason to have done it this way and I hope everyone on their team is safe.
I'll just pipe in as a reply to your comment that, despite never having known this org until now (unfortunately for me, they seem cool as hell), the statement reads as a bit inexplicable.
The first connection my brain made was to the moderator of /r/IAMA who, thirteen years ago, in the midst of its massive success, randomly and unilaterally decided to shut it down [1] (although on a retrospective reading, I actually understand their reasoning more than Hindenbergs).
[1] https://old.reddit.com/r/IAmA/comments/ju5cf/goodbye_iama_it...
> In May 2022, Hindenburg took a short position in Twitter, Inc. following the announcement of its acquisition of Twitter by Elon Musk. After Musk's attempted termination of the deal, Hindenburg took a significant long position on Twitter, betting against Musk on the acquisition to close.
Something about that individual coming to power along with the other oligarchs? The coming political climate looks to be one where money is more important than the rule of law (even more so than usual), which might be bad news for a business like that.
I’ll always remember them for exposing the Nikola motors fraud: https://news.ycombinator.com/item?id=24436721
Wow, this made me really emotional. And even though I definitely did not expect a chill Bali DJ set as the motivational link, it also resonated with me in some way.
I can't think of a more honorable way to move through life. I liken the act of closing shop at this point for Hindenburg to the legend I know of Cincinnatus, the Roman emperor who did the job of emperoring and went back to his fields when it was done.
It also moves me how the team is described, as being from whatever background, but all moved by the same fire. I wish that I could be a part of something like that. What the hell am I doing with my life?
Did he... link the wrong URL at the end of the post? I thought for sure it was going to be some sort of heartfelt speech, or motivational message, or something. But it's an instrumental DJ set which seems totally out of left field
> P.S. If you are chasing something you think you want or need, or are doubting whether you are enough, take a minute and give this a listen. It had a big impact on me at a pivotal time.
He shared something that helped him at a pivotal time. Your expectations are your own. :)
The right music at the right time can be transformative.
I remember listening to the theme song for "The Social Network" often when I was frustrated at work about 12 years ago in a different job in a different state in a different life.
Scala & Kolacny Brothers -- Creep
It's a haunting choral cover of the Radiohead song.
The Social Network soundtrack is essentially mandatory to listen to when coding, I've heard it thousands of times by now.
Ha I guess that's fair. Were you expecting a DJ set?
I did have a guess that it was musical. I did not guess it was of the genre haha.
And the highlighted comment on that video (because it's got a lot of upvotes) is "Who's here because of Hindenburg?"...
I suppose all the research work, that comment, and the 750+ thumbs-ups, and my cynical meta-comment all brought value to the world. But I'm only sure of one of those things.
I actually skimmed through looking for when the inspirational talk starts.
I had the same idea. Maybe it's a subtle message?
Everyday, at the same time, in the same place, play that instrumental DJ set and with a blank document write down whatever comes to you.
Let me know what you find.
I was pretty amazed to see him link this particular Lee Burridge set from Bali. I’ve watched/listened to it many times over and it never fails to put me in a happier state of mind.
I was fully expecting [1] but then I just listened for a while and honestly, I get it.
I can't explain, but yeah.
He only uses that one when he's getting short squeezed
the psychedelics are implied
For myself at least that was a wild behind the curtain reveal; for a group that's had such a profound impact exposing some of the better kept secrets of some of the worst people and companies, Nate presents himself and his associates as surprisingly ordinary day to day types armed with grit and determination.
In my experience, people tend to grossly overestimate the scale of publicly known organisations; the more publicly known, the vaster and more faceless people imagine it to be.
They are short sellers, were you expecting roided out pro-wrestlers with tats and wild hair or something?
Absolutely, it's well known that Jane Street and other major traders draw heavily on the former WWW stable for their short staffing.
Good.
After the details of the sources on the absurd hitjob they did on Super Micro came out recently, they should be deeply embarrassed.
The whole thing was basically just the claims of a disgruntled sales manager, of very dubious character, fluffed up to seem like there was some legion of internal whistleblowers.
Not to mention relying heavily on mixing in details of long settled previous issues at the company to lend credence to the dubiously evidenced current claims of malfeasance. Shameful profiteering on the part of Hindenburg there.
They should have nipped that report in the bud instead of sloshing it out the door.
Yea the Adani report already had me skeptical but the Supermicro hit job, and the fact that multiple independent auditors haven’t found the same claimed problems in their accounting, has made Hindenburg look a lot more shady. This to me looks like an incompetent firm that profited from big short positions and potentially false reports, now closing shop so there’s no assets to claim in a lawsuit.
The impact this organization had was incredible. I doubt they would have been able to do this work if they were based out of any other country, which makes me wonder how the US legal system, regulators and law enforcement in general are not extremely corrupt. What reasons or incentives make the system work in the US? Of course there are many instances of corruption and injustice, but in comparison to almost any other country, it seems to work surprisingly well.
There are many reasons for this but primarily its simply that it is a wealthy country with a functioning legal system. US courts are generally fair; if biased. This has changed with many recent rulings by the SCOTUS. But there exists a culture of generally respecting laws (and an apparatus to enforce those laws).
They published about Carvana 13 days ago and now are disbanding... https://hindenburgresearch.com/carvana/
Getting out while they are ahead is a smart move, especially considering multiple governments have started to take a closer look at their shorting tactics.
Can someone give me the context please? I’ve never heard of this organisation before. What do they do and what are they known for?
Their "shorting tactics" ? You mean doing extensive well sourced research that convinces other people that their position is correct?
I'm assuming when he says "governments taking a look at" he means like the Indian government and it's more of a Mafia-type "taking a look at" than a serious inquiry with any actual merit. A strongarm type thing
I think its brought attention to numerous cases of accounting and other shenanigans.
What I've noticed, casually, is that they often target companies or management with a pattern of fraud and abuse, and surprise they keep doing it.
VP of Sales gets slapped on the wrist for illegal tactics?
A few years later he goes on to be promoted to CEO and.... does the same thing!
Amazing.
I’m interested in the materials they open source.
I wouldn’t be surprised if the sum of it is “has the company been caught doing fraud more than once and haven’t been shut down? They’re still doing fraud”.
Pretty big allegations without any source.
But the Indian regulator was going after the short seller suggesting they used non public info. Turns out India is corrupt which we already knew as a fact and one of the chiefs owned the stock.
The source is their research. Much of which was publicly available.
You can draw your own conclusions but a company worth hundreds of billions of dollars being audited by a mom and pop shop is more evidence than anyone needs that their books are made up.
The fact that the Adani group couldn’t refute any of their claims was pretty telling as well.
Yeah not like Hindenburg researched a large Indian company with close ties to the BJP.
https://www.aljazeera.com/economy/2023/3/1/modi-govt-allowed...
Stone cold assassins indeed. We need more people like him.
What no one touches is that he used to unmask the devil and also let the regular folks (if they trust him) take short positions just like he did. Sort of Robin Hood with weak reference.
That's not how that works. They take out short positions and then release the info to profit off the drop when they announce. Announcing publically is how they make their profit, not them letting you in on it. Informational advantage is their entire strategy.
Damn thats clever.
Apropos user name ;)
I mean that's the whole business of a short seller.
Take a big short position, then spread the bad news. Hopefully, it's true: the stock drops, and you make a mint. If you fail to spread the news, or you don't get the facts right, the stock goes up and you lose.
Thank you for all the great work. Big respect.
Has anyone else publicly copied the Hindenburg investigation/financial model? It's not proprietary AFAIK.
It's a hard business to make money in. Shorting tends to be intrinsically harder because the market goes up over time and Americans are generally optimists. Plus the last 2 years we've seen 20+% market moves upwards.
Despite it being a necessity for functioning markets, when you are short, seemingly everyone is against you - business management, regulators, media, etc.
Not surprised to see them bow out. Chanos did so last year.
This is one of the reasons frauds go on so much longer than you'd expect - no one wants to hear the truth.
People have this idea that short sellers are market manipulators who conspire to wipe out innocent day traders' life savings and trigger mass layoffs with the stroke of a pen (hence the term "financial terrorism," which is absolutely comical in its hyperbole but used with complete sincerity by the anti-short crowd), but like tines said, it's a risky business that requires lots of research that frequently goes nowhere with limited upside and uncapped potential losses. The amount of times they and other short sellers publish damning evidence on a company only for the stock to shoot back as soon as the company releases a "nothing to see here" non-response really shows the difficulty in making money in the space (and how much people want to bury their heads in the sand).
Given the regulatory environment we are heading into, I expect short selling will become an even riskier business since the SEC isn't going to be prosecuting fraud anymore (or rather, they'll be doing even less than they are now), making it much easier to sic the lawyers on firms like Hindenburg. Even though this isn't their stated reason for bowing out, I wouldn't be surprised or hold it against them if it was a factor.
I think the prospect of an impending SEC or other investigation is only one factor in stocks losing value.
They highlight inflated sales and financial irregularities like a chain of companies that engage in self-dealing, but are portrayed as independent to hide their real ownership, and so on.
If you believe what they say, your faith in the company is shaken because they're pulling a con job on you to invest in them and believe their story. If the SEC investigates that just supports the claim that it's a con.
If they don't investigate - for whatever reason - it doesn't mean that it's not a con and you won't lose all of your money believing it.
So a change in the regulatory environment is only one element.
For example, the Modhi/Adani thing is outside the reach of the SEC. And after watching a piece on it, apparently shorting it was amazingly tricky, and they had to go through some Singaporean markets to arrange a short position.
SEC Commissioners turn over slowly. It is not quite as independent as Fed, but more independent than most agencies.
I’d wager a big part of how they make money is as SEC whistleblowers. It’s not as huge of money as shorting is - but it’s typically a single digit percentage of the recovered fines. Considering these guys nailed a company that defrauded people of $3 BILLION dollars, they’d net $30 mil from turning that company in even if the payout is only 1%.
The SEC has a policy of paying out part of recovered fines as bounties to whistleblowers to align incentives. If your company is doing something sketchy, you get a payout by doing the right thing.
I’m not a lawyer but I think that mechanism works just as well if you’re an external reporter of fraud. SEC makes money and pays you for your diligent forensic auditing.
Do you have any evidence/links that discuss this? I'd be surprised that they'd get any whistleblower fees, because they themselves aren't actually the whistleblower. E.g. a whistleblower usually refers to actual insiders with private knowledge that then "blow the whistle". In Hindenburg's case, they basically just did research anyone is capable of doing (although in many cases, after they became known, they did have whistleblowers reach out to them).
This bounty program doesn’t require being an employee
Astute observers and outsiders - doing the same thing prolific short sellers do - have received some of the biggest bounty payouts
The source is on the SEC’s bounty payout page
Its 10% to 30%
where did you get 1% from, its a really good bounty system to clean up the markets and you get to be anonymous if you use a lawyer, the trick is to get the SEC to prioritize it. They are now inundated after some large payouts made the news in financial circles
Large indeed - there was a $279 million payout to a bounty hunter in 2023:
Matt Levine always has the good stuff, but he had commentary on a profile of Jim Chanos (the lesson not necessarily being specific to Chanos) that always sticks with me. The profile that discussed the idea that the real sort of 'secret sauce' was that the combination of Chanos' main funds were like 190% long, and then 90% the short stuff he wan known for.
On its surface, nothing crazy for long/short funds, the notable part was that basically all the effort was on the short side, and the long side was implied to be very humdrum. And the short book had like negative returns over a long period. It just struck me as a really elegant (if extreme) example of what uncorrelated returns can do if you do somehow have some edge over time.
And I'm not sure what Hindenburg's holistic picture is, but whether rightly or wrongly now I usually assume most of the kind of very public shorts operate similarly. I was never really on board with the "short sellers are evil" train of thought, but I did believe, "oh these very public short sellers only short things, they just go around all the time thinking everything is awful". And my assumption now is that they are like, kind of really theatric long/short funds.
Matt had some line like if you extremely good at something, you can get rich doing it, even if it loses money. As long as it's not correlated.
> Shorting tends to be intrinsically harder because the market goes up over time and Americans are generally optimists
Also, with shorting the best you can do is double your money (if the stock goes to 0), while you can lose an unlimited amount (as there’s no cap on a rising stock); whereas with going long, you can only lose all your money (again, if it goes to 0), but you can gain an unlimited amount.
Except for leverage... but the general point remains that the upside is capped and the downside in theory is not.
This is incorrect. The way shorting works is you borrow a stock (and keep paying premium for the duration) and sell it
Premiums are usually small, so you can make many multiples of paid premium
And since their business model is releasing the findings, which in turn makes the stock drop, they can time their short position very well and don't need to pay premiums for long
I think you misunderstood what I meant by "your money" in "double your money" (and I was unclear). You can only earn the value of the stocks you borrow. When trading long, the gain is unlimited.
According to Investopedia, "the Federal Reserve Board requires all short sale accounts to have 150% of the value of the short sale at the time the sale is initiated" so it's the same principle as going long with margin. You can leverage yourself but there's a limit.
Yes, but borrowing short is fundamentally leveraged. As long as the stock doesn't increase in value, you don't need much of your own cash to secure it - because you're holding the cash from selling it.
But, of course, that gets ugly when the stock goes up; that's when you have to start putting your own money in against the borrow.
You borrow 10 shares that are currently worth $10 each. You immediately sell and get $100.
The price drops to $1 per share. You spend $10 to buy those shares and return your loan.
So you spent $10 and made $90. That's a 9x gain.
Yes you cannot make more than $100. But of course you can! Do the short on 1000 shares instead of 10.
The more confident you are of the share price going down, the more shares you borrow. Unlimited upside.
Isn't this a bit like arguing that you can make infinite money by borrowing infinite money and going long? You have to maintain margin requirements which limits how many shares you can borrow so again, you can really only double your money (not even double, iiuc your account has to have 150% of the value of your short), unless there's something I'm not seeing.
See put options.
The song remains the same - the stock can only go to zero. The upside of a put is effectively capped at (strike price minus stock price) * 100. Going long via shares or calls is unlimited.
Right, but the price of the put is much less than the price of the stock, and the price of the put is the denominator.
Right now, Walmart is at $91.34, and you can buy a put at $88 expiring on 24th January for $0.18 [1]. If you buy one, and the stock goes to zero by then, you spent $0.18 and gained $88, a 488x return. January 2026 at $86.67 is $5.35 - a mere 16x return.
[1] https://www.nasdaq.com/market-activity/stocks/wmt/option-cha...
> Shorting tends to be intrinsically harder because the market goes up over time and Americans are generally optimists.
... and the market can stay irrational longer than you can stay solvent.
I remember once I tried shorting a stock, of a market leader in my area. I knew the field well enough to see that they were trying to fudge some numbers and their quarter was _not_ as good as they had claimed it to be.
But sadly the market didn't see this and the stock went up. E*Trade started pushing me to cover my positions, and eventually I ended up losing a 5-figure sum (nothing earth-shattering, but still a good chunk of my cash).
After I had bought it all back, slowly the market realized what I had seen and the stock dropped as I had expected. Unfortunately I did not have the deep pockets to stick around long enough; all I was left with was a hole in the wallet and a hard lesson learned.
Somebody say the thing please
They are planning to release their methodology. Buried in the article:
> Beyond my own desire for relief, it also feels selfish to keep the knowledge we’ve accumulated trapped within our small team. I have more than enough. In the past several years we’ve been flooded with thousands of messages from many of you asking how we do what we do, or whether you can join the team. I read them all and I’ve been trying to figure out how to respond in a way that can answer everyone—so over the next 6 months or so I plan to work on a series of materials and videos to open-source every aspect of our model and how we conduct our investigations.
Aside from the obvious risk of short selling is the tornado of lawsuits and threats that arise from targeting shady companies.
Just because some company is accused shenanigans or breaking the law doesn't mean they won't try to litigate you out of existence.
Or that they don't have associates with baseball bats who might visit you in the night to discuss your "bad choices".
It takes some real minerals.
What they do isn't anything new or revolutionary. Short sellers have existed ever since public markets have existed. See Muddy Waters Research, Citron Research, Kynikos Associates, Pershing Square (famous for their crusade against Herbalife), Gotham Research, all of the Big Short folks. And these are just the active ones.
There's quite a lot of short sellers that publish their research.
I believe Andrew Left and Citron Research were the first.
Take a look at Scorpion Capital.
Hindenburg Research shorts going strong!
From their About page
"...Hindenburg Research specializes in forensic financial research.
...we believe the most impactful research results from uncovering hard-to-find information from atypical sources. In particular we often look for situations where companies may have any combination of: ... • Undisclosed related-party transactions..."
I would love to see whether Bayesian inference can be applied to quantitatively establish when "there's a there there' in any given situation. When is the unlikelihood of a coincidence transcend beyond the level of background noise?
Literally every time I shorted (our bought puts) I lost money. One particular short of Beyond Meat (via puts) I was right about eventually, just not in the timeframe needed. I knew Beyond Meat was BS but unable to sustain the losses as it kept climbing in a complete bubble.
I'm so confused – I thought these guys were the absolute best in blowing the whistle on scammy corporations.
There were - nothing in the article counters that.
wow! I've always thought of them as some ruthless finance people with huge egos. This piece made me think differently. Very moving read!
In an upcoming age of oligarchy, regulation will be adapted to suit business owners. As an example, it seems that Gautam Adani is friendly with Trump.
What will be the impact on the SEC? What are future scenarios of fraud enabled by weaker regulations?
But this is a regretable, but wise move. Love the fact that he linked a DJ set.
Godspeed, Hindenburg folks! I started to really appreciate your work, when I read Dan McCrum and the other Alphaville writers at the FT.
> In an upcoming age of oligarchy
oligarchy has been going on for a long time, regardless of political affiliations.
to see why i say this, look at (no relation) https://quiverquant.com , and you'll see professional politicians with sub $180k salaries worth tens of millions of dollars, for just one example.
'X has been happening for a long time' is an old tactic to hide bad things behind some undefined excuse of inevitability, and discourage any action. Corruption has been happening for a long time, but that doesn't mean it can't get much worse or, through our action, much better.
What does it even mean? What does it matter if it's been 'going on for a long time'?
Hindenburg Research and Muddy Waters are like heroes to me. It's one thing to have an opinion about corruption, another to maybe be a whistleblower or activist, but to take levered bets against corruption and win is next level.
Almost every time I see a dark pattern in tech I think there should be an opportunity to bet against it. Certain companies I can think of who appear to be faking their MAU numbers with "urgent notices" to login to obviously abandoned accounts, or who won't let you close an account even though there's no way to get the balance out to close it, both seem like opportunities. Still others, who appear to gamify their notifications to drive DAU numbers seem as bad as twitter's pre-musk bot problem.
part of the case for breaking up some of the platform companies is that they protect some shitty practices from the market by having a behemoth to bail out products that wouldn't survive on their own, and they create a huge barrier to market entry against desirable products.
the page seems to be hugged to death, but whatever the case, congratulations. they are, and should be an inspiration to others.
38 seems young to quit. Is there another story here?
Given the number of ultrarich and powerful people that already hate the Hindenberg folks... my guess would be that there is some calculus here about the incoming U.S. presidential administration's enmity towards whistleblowers and their prior statements about changing libel laws in the U.S.
Um, yes.
Starting next week, it's open season on suckers. It's going to be like the glory days of the Tel Aviv binary options scammers, who at one time were 40% of the Israeli finance sector and had good political connections.[1] Crypto deregulation is coming. No more CFPB enforcement! No more SEC enforcement!
There are still people who haven't lost money in crypto yet who can be targeted. They're all little people. No one will help them. Just pay off some influencers and start up your scam.[2]
[1] https://www.timesofisrael.com/topic/binary-options-fraud/
Hindenburg exposes hucksters and frauds. Hucksters and frauds have now taken over the highest office. He just sees the writing on the wall and needs to get out now.
There is a very fine line between investigative journalism and market manipulation. They treaded it pretty carefully so far, but were bound to slip up sooner or later. Especially now that they are prominent enough that HFT bots are instantly shorting every company they mention in new posts. Quitting while they are ahead is a good move.
Off the top of my head the reporting about Block - CashApp was disgraceful and Hindenburg got sued for it. Not sure how that's going to play out with disbanding the "company."
I don't think Hindenburg is scared of being sued, otherwise they wouldn't have been in the business in the first place. Their investigations are extremely thorough, with everything fully documented, mostly from public records, for the specific purpose that if/when they show up in court, they can be confident of the basis of their findings.
https://www.reuters.com/legal/government/adani-group-threate...
P.S. where did you see Block suing Hindenburg? The closest thing I can find is 'Block said it intended to “explore legal action” against Hindenburg, who sought to “deceive and confuse” Block investors to “profit from a declined stock price.”' which is just PR speak
How do you explain their report on Supermicro? It seems nothing was wrong there after all. From https://www.morningstar.com/news/marketwatch/2024120275/why-...
> the committee confirmed previously stated findings that there was "no evidence of fraud or misconduct on the part of management or the board of directors."
>I don't think Hindenburg is scared of being sued, otherwise they wouldn't have been in the business in the first place
They should be. If doesn't matter how well everything is documented or how above-board the company is when the courts turn into kangaroo courts for a thoroughly corrupt administration. They're right to get out now while they still can.
Would that really be a factor? It's hard to call it slander when you agree to pay the fine.