Debtwired!
Muddy Waters deep-dive short ideas explored with Carson Block
Feb 14, 2024
CEO of Muddy Waters, Carson Block, discusses short selling trades in credit, European real estate risks, and challenges in implementing short trades. Examples of trade ideas and manipulation of real estate valuations are explored, highlighting the difficulties of short selling in a market with reduced liquidity and legal risks.
16:20
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Quick takeaways
- Actively short sellers like Muddy Waters focus on historical information to project potentially worse future outcomes.
- Real estate sector risks are linked to subjective valuations, susceptible to manipulation for financial gain.
Deep dives
Activist Short Sellers' Focus on Historical Information for Trade Selection
Actively short sellers like Muddy Waters focus on historical information that differs from the market's understanding or reveals misrepresentation by companies. The emphasis is on past data to project a potentially worse future outcome. An example provided was the Group Casino short trade in 2015, highlighting unnoticed leverage in the company's financials.
