Whitney Tilson Says Bitcoin Heading Towards Zero

Lumber Liquidators LL Tesla Whitney Tilson K12 Questcor Pharmaceuticals QCORWhitney Tilson

Whitney Tilson is back after a long hiatus. According to an email sent to investors, Tilson is only short seven companies currently. He discusses two of them below, LL and WRLD. Tilson also discusses bitcoin, which he is not a fan of. The cryptocurrency has been on a big downturn, but had a huge gain before that, starting almost to the day Tilson called it “an obvious scam“, as the chart below demonstrates. It sounds as though Tilson is calling for bitcoin to go to zero.

See Tilson in his own words below.

I’m only short seven stocks currently, but there’s news on two of them:

1) The Environmental Investigation Agency is out with an update on its initial 2013 report, Liquidating the Forests, which detailed how the Russian mob is illegally harvesting hardwoods in protected areas of Siberia, home to the last 500 Siberian tigers in the world, and smuggling it across the border to mills in China, one of which processes it and sells it to Lumber Liquidators. The latest news is:

Senior executives of the Russian timber company “Beryozoviy,” which supplied high value timber to Lumber Liquidators, were found guilty by a Russian court in December 2014 of 15 counts of illegal logging occurring between 2010-2012 and of participation in a criminal network.

This company must be a MAJOR bad actor for executives to be caught, convicted and sentenced in Russia, which isn’t exactly known for this… EIA’s update is below and be sure to watch this two-minute video EIA posted at: https://www.youtube.com/watch?x-yt-ts=1422503916&x-yt-cl=85027636&v=y2mFvvPaDO0

2) Speaking of scummy companies doing evil things, World Acceptance, the most predatory lender I’ve ever seen, reported weak earnings this morning (see below) and the stock is down more than 7%. The fundamentals are deteriorating rapidly – and once regulators act, I think it will pretty much put them out of business and the stock will be a zero.

3) Lastly, speaking of zeroes, it’s good to see bitcoin collapsing toward that mark:

Bitcoin is proving a big disappointment. The virtual currency is down 33 percent against the dollar in 2015, and 71 percent in the last year. There is almost certainly more bad news to come.

The electronic token has lots of enduring problems. As a store of value that is not subject to government intervention, it lacks the support of authorities and is always in danger of being banned.

The market was illiquid to begin with and is becoming even more so, increasing the risk of abuse. Bitcoins generate no income, so they count as collectibles – more like artwork than a few shares of Google. In these matters, beauty and value depend on the fickle eyes of the beholder and potential buyer.

Lumber Liquidators LL Tesla Whitney Tilson K12 Questcor Pharmaceuticals QCOR

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5 Comments on "Whitney Tilson Says Bitcoin Heading Towards Zero"

  1. It would be like comparing Gold to the Internet – the Internet is much more useful than Gold.

  2. I hope it goes down to 1cent. Then I can buy millions of them!

  3. Natoshi Sakamoto | Jan 29, 2015, 10:54 pm at 10:54 pm |

    Do not discard bitcoin yet, it has been declared “dead” many times before (see: http://bitcoinobituaries.com/). The blockchain/bitcoin technology is here to stay, it is the greatest invention since the internet, and just like it will have a bumpy start, since the powers that be/governments are fighting it, same as they did to the internet (and continue doing now trough legislation against net neutrality), but decentralized/distributed systems will always prevail, since they can’t be killed, only delayed, there is no single point of failure. Don’t worry about the bitcoin price right now, but look at the fundamentals, just like gold and silver, the bitcoin ecosystem/start ups/applications/VC investments around the blockchain technology has continued growing at an ever faster pace since its creation in 2009, while the price continues spiking and “collapsing” in cycles/”bubbles” at an ever increasing scale, first on the $.10’s, then on the $1’s, $10’s, $100’s, then spiked over a $1000, now “collapsed around $200’s, just waiting for the next cycle: Spike over $5000 or $10,000 when the pending bitcoin ETF’s come out and Institutional/Corporate/Wall Street money starts pouring in. Bitcoin will rise again, as always, you need to understand its cycles. Buy now that is cheap, just like gold and silver also. Fundamentals remain strong in bitcoin, beyond price manipulation, can’t you see the similitudes? Bitcoin is also of limited supply.?

    Bitcoin is backed by mathematics, cryptography and the most powerful and secure decentralized distributed computational network on the planet, orders of magnitude more powerful than google and government combined. There is a limit of 21 million bitcoins (divisible in smaller units). Dollars are not backed by gold anymore since long time ago, they are printed by the trillions out of nothing by the private institution called “Federal” Reserve.

  4. Artwork? It has all the same functionality of all the worlds Banks, Credit Card companies, Treasuries, and so much more. Artwork usually isn’t very useful.

  5. Those that look at Bitcoin purely from an investment standpoint generally don’t understand it.

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