Politics

Whitney Tilson Betting $10,000 On A Hillary Clinton, And Wants To Raise That Number

Whitney Tilson just cannot stop talking about Trump and he has another email out on the subject  tonight – willing to bet a brave Donald Trump supporter that Hillary Clinton will be the winner. This actually is a good deal for Tilson since Hillary is favored to win so with Tilson making a one:one bet he can cash in the difference on a bookie site? Some election arb? Anyway, below is the email from Tilson.

Whitney Tilson

In my last email, I wrote:

 

When I sent out my last email a few days ago, in which I took my criticism of Trump to a new level (calling him a monster, comparing him to David Duke and Joe McCarthy, and warning an acquaintance who’s publicly supporting him that “The risk that your personal reputation is materially and permanently harmed has gone up a lot”), I braced myself for the blowback that always occurs when I send out a very partisan email: angry emails condemning me for using my email blasts for such purposes, requests to be removed from my email list, etc.

 

The response so far: crickets. I was so surprised that I went back and checked to make sure it had gone out (it had).

 

Of the 3,000+ people on this email list, I’d guess 1,000+ are Republicans – and not a single one emailed me to say anything along the lines of: “Whitney, I think you’re wrong about Trump. You’re misunderstanding what he’s saying and/or he doesn’t really believe it and/or even if he does, he’ll never be able to implement it and/or as much as I don’t like what he’s saying, I think Hillary is much worse, so I’m holding my nose and supporting him.”

 

To repeat: not a single reader emailed me to argue against what I wrote. That has never happened before, and I think it speaks volumes…

 

This time, the response wasn’t crickets – I heard many arguments from my readers who support Trump – so I’m sending out one more email on this topic.

 

I will keep most anonymous, but my friend Anthony Scaramucci (aka: “Mooch”) of SkyBridge Capital and Wall Street Week said I could share publicly what he wrote, so I’ll start with that.

 

1) Mooch writes:

 

This is going to be a close election and the demonization is only just beginning. However for me this is a battle of ideas and not personalities. The left has crippled the country and hobbled its ability to grow. Welfare and poverty maintenance and the destruction of the public education system has created a permanent underclass that Daniel PatrickI respect Buffett as do you but I find a lot of his policy ideas hypocritical. He is a fabulous investor and brilliant on a lot of things. Just not policy or his view of Hillary Clinton.

 

There is an intersection of proper government function and the power of a thriving free market. We aren’t there now. So I am willing to stick my neck out for disruptive change. That isn’t crickets that in this election season is balls and risk.

 

He is going to win – and he isn’t racist. The weird thing about it, there are people right now they don’t think they will vote for him but they will.

 

(By the way, anyone who wants to make a straight-up bet with me on who wins (I obviously take Hillary) – with the proceeds going to the winner’s favorite charity (mine is KIPP charter schools) – let me know. I already have more than $10,000 of action and will take up to $50,000.)

 

2) Mooch and I are both quoted extensively in this NY Magazine article by Michelle Celarier about the “Wall Street Titans Who Back Trump” (full article here; here’s an excerpt):

Republican Party loyalist Anthony Scaramucci, 52, the co-founder of SkyBridge Capital Management, which invests in hedge funds (including Paulson’s), was a lead organizer of last night’s event. He is in the red this year, down about 4 percent through mid-June. But like Trump, Scaramucci has morphed into a performer, with a weekly cable-TV show on Fox Business — Wall Street Week — and an annual Las Vegas confab for hedge-fund bigwigs and their investors. The high-octane event also features movie stars and politicos, and Scaramucci prides himself on being able to bring diverse groups together. (Whether or not it was Scaramucci’s doing, hard-core Ted Cruz supporter Robert Mercer, billionaire co-CEO of the Long Island–based hedge fund Renaissance Technologies, was moved to attend the event and officially become a Trump donor.)

“We can all agree Trump’s comments are incendiary,” Scaramucci, who has become Trump’s most stalwart defender on Wall Street, told Daily Intelligencer. “But he’s not a demon.” Scaramucci argues that Trump will start to moderate his positions and soon will “look like the negotiator and deal-maker that he really is.” Distressed debt investor Wilbur Ross — a fellow GOP stalwart — offered the same line last week on CNBC, where he came out for Trump.

Yet, just three days after Scaramucci said that, Trump was suggesting on CBS that the U.S. engage in more racial profiling.

A more common view among elite investors, at least according to the informal sense of many well-connected Wall Streeters, is that it’s too late for Trump to change. “He’s shown his true (and abhorrent) colors,” hedge-fund manager Whitney Tilson of Kase Capital wrote in an email he sent out to 3,000 people in the investment community on Friday. “A month or so ago, one could have argued that he was just playing a role during the primaries, pandering to the far right, angry whites, etc. to win the nomination, but then, having secured it, would cleverly pivot back to the center and position himself as a pragmatic, business-oriented guy and stop whipping up hatred toward just about everybody except white men. That argument is now in shreds. It’s now clear that he has no coherent ideas or policies — he is just about fomenting hatred, nothing more.”

Tilson, a Democrat, also warned his Republican friends that supporting Trump would hurt their careers. “The risk that your personal reputation is materially and permanently harmed has gone up a lot because, while you obviously haven’t (yet) reached the conclusion that he’s a monster, that’s the emerging consensus view, so the reputational cost of tying yourself so closely to him has gone up materially.”

He acknowledges, however, that there is a case to be made for being one of the few finance people tied to Trump should he beat the long odds and win. “As one of his few supporters, you’d have great influence and could probably have your pick of a number of cabinet positions.”

3) From a reader:

 

FWIW, I am a conservative Republican who does not like Trump but will vote for him. I find comparisons of him to fascists like Mussolini to be utterly ridiculous – devoid of deep thought and written by people who have no idea or concept as to what fascism is or entails. I suspect a good portion of other non-respondents felt the same way. He is a chameleon but you don’t get to where he is in (professional) life by being mentally unhinged or insane  – “arguments” like that (and describing him as a “racist”) are canards and emblematic of those who can’t formulate a cohesive counter (noting Trump’s lack of consistent positions, articulated philosophy, etc. are legitimate, unequivocally!). I loathe and despise the Clintons – but I would never question their sanity.

 

His simplistic delivery aside, what he is advocating from a geopolitical perspective COULD make sense – the Post WWII paradigm no longer works, and he is bringing up issues that need to be re-thought. As someone who was an economics major, his diatribes on trade deals rub me wrong way – but reading articles on the Trump phenomenon by guys like Epstein and Charles Murray (and even Don Luskin’s op ed in today’s WSJ) put an interesting spin on his thinking on trade. Now, mind you – he COULD be a total unsophisticated rube, but politics are rife with those. I think the Donald is crazy like a fox – you don’t build wealth like his based on ridiculous branding without some guile. I think there is a ~10-20% chance he could be a great President that really shakes things up (whereas I think HRC’s odds of accelerating the US’s decline are a near certainty). I also think there is a 5-10% chance Trump could be a disaster – but his “expected value” is most certainly higher than HRC’s (with greater potential standard deviation). Make sense? Try reading this: http://www.mauldineconomics.com/this-week-in-geopolitics/beyond-the-current-fantasies-in-the-jihadist-war

 

4) Another reader:

 

Do you ever wonder if there is so much silence because people are essentially being told (by the media and others) that to support Trump or his ideas is to be vilified: “The risk that your personal reputation is materially and permanently harmed has gone up a lot”

 

I don’t like Trump the businessman. He has been involved in numerous scam companies. Trump University. ACN. But, you know what, as our government (even the people we are proud to support) has let the scam industry run wild, it’s not surprising that ever-more successful, rich Americans work in the scam business.

 

Trump’s a bit crude, but have you noticed that America has become stunningly crude as well over the last 20 years?

 

Trump is overly reliant on debt in his real estate business … well he’s in good company with his irresponsible use of debt in America 2016.

 

Who was it who said people get the leadership they deserve?

 

What I don’t like about all the Trump hatred is that it allows one group of Americans to say to another group of Americans that they are racist, David Duke supporters.

 

Why not stop to consider why some of Trump’s ideas resonant with them.

 

These ideas are: 1) fear that immigration is running out of control and 2) that too much of the heart and soul of our economy is being outsourced because of bad trade deals.

 

For years, no politicians would talk about these issues. They were taboo. To dislike “globalization” was to be a backward and racist.

 

If you work on Wall Street it’s so easy to embrace globalization. You get all the benefits and none of the pain. The jobs flow out and the dollars flow back in. Without the dollar as the world’s reserve currency, our economy would have collapsed. But in many communities across America that relied on outsourced industries the collapse has already come.

 

I wish Trump was a more impressive person. I wish he didn’t say stupid things. America deserves someone more impressive than him to represent it.

 

But I don’t think it helps to vilify the man (and by extension all of this ideas) because you deny the legitimate concerns of Americans who get up every day and see their country slipping away. Take a tour of America’s secondary cities and ask yourself how long life will be sustainable in many of those places. Meanwhile, there’s a nonstop party on Wall Street.

 

I have no idea who I will vote for but I think there is a downside to hurling hatred at Trump — and by extension the people who support some of his ideas.

 

My response:

 

You make excellent points. But you mischaracterize what I think and what I wrote. The issues you (and Trump) raise like the effects of immigration and trade are very real and very legitimate, and should absolutely be debated. I didn’t call Trump a monster for this. I called him a monster primarily because of HOW he raises these issues: essentially calling all Mexican immigrants rapists and criminals, all Muslims should be banned from coming to our country because they should be assumed to be terrorists, etc. He’s a terribly dangerous demagogue who whips up hated by and among various different groups of people, which is the opposite of the melting pot that this country stands for. I believe he is a monster who must be stopped primarily because he threatens the very fabric of our country, not because a few of his mostly scattered, unintelligible, poorly thought out ideas are actually legitimate. This fact does not make him in any way legitimate – and, in fact, having a racist lunatic as a messenger, it makes it easy for those with power (in both parties) to ignore the legitimate issues you (and Trump) raise.

 

Her response:

 

My concern is that people dislike Trump, the man, so much that they want to take everything he stands for and dismiss it as racist garbage. You say issues such as immigration and trade should be debated. Well, why haven’t they been? I give Trump points for bringing them up. The Republicans lost their party because they have had their heads so deeply in the sand that they forgot to notice who they were supposed to be representing and what those people actually care about. The Democrats aren’t much better.

 

As far as how Trump says things … well, for sure, I cringe at a lot of things he says but I also think the pendulum has swung too far to the politically correct side. And that shuts down conversations and tears at the fabric of the country and our right to free speech as well.

 

America spews a lot of hateful, violent garbage into the world via our popular culture but the Hollywood businessmen and women who profit from it don’t ever get called to task for being monsters.

 

I wish the solution was as easy as just hate and defeat Trump and everything will OK. America will be safe again.

 

All that said, I do understand why you despise Trump. I despise much about him too.

 

If something good comes out of his campaign I hope it will be that politicians will acknowledge that he appealed to people with deep fears about the direction of the country and that those fears are not just based on racist paranoia.

 

Then maybe we can move forward while reducing the hatred rather than deepening it.

 

5) Another reader:

 

As you know, I despise/loathe/hate Hillary and Donald. That we have come to the place where one of these two fetid simulations of a real person will lead us is horrifying, depressing, terrifying and just plain sad/pathetic. We’ve met the enemy and it is us.

 

Trump’s sins are dreadful and despicable. Sadly, our choices both reek of corruption, dishonesty and an unwillingness to deal with immensely important issue that aren’t going away just because BHO, HRC or Donald Dump don’t want to consider them.

 

I don’t think I can vote for Trump but I am also pretty certain I can’t vote for Hillary. It won’t matter here in California and I will feel bad about it. But the stench from each of them is devastating to me. And by the way, Roger Cohen got it right the other day pointing out Obama’s role in the current disaster on the international scene. He is a fool who can never acknowledge he is wrong about anything. How you can stomach this narcissistic fraud is beyond me. And the damage he has done to America is incalculable and I voted for the son of a bitch the first time, which as you can imagine I regret terribly.

 

Sad times — as Bob Dylan said more than 50 years ago, a hard rain’s a gonna fall.

 

Another reader echoed similar sentiments:

 

I can only reply that Hillary is incapable of telling the truth and incapable of not trying to cover up stuff. I get the feeling you want to give and give to those less fortunate. So do I. But how one gives is important and the liberal side doesn’t seem to care. Even if there are negative unintended consequences.

 

I view Obama as every bit as bad as Trump. He has a smooth facade but no international leader and no serious corporate manager I have spoken with has any respect. Only fear of what he may sic on them and their employees. And can he please call a terrorist a terrorist! And stop making Muslims the untouchable group. He has even had fanatics at his dinner table and consistently left our staunchest ally out on a limb. He’s a thug and a lie. He’s a disaster. So let’s not put it on trump too much.  Hillary and Obama are of the same ilk.

 

My response to both of them:

 

Based on what you send me, I think you spend many hours each day reading extreme right-wing blogs/websites (not the WSJ or even Fox “News”, but the FAR lunatic fringe) and, years of doing this has turned your brain to mush when it comes to Obama and Hillary.

 

Obama and Hillary (and I) are smack in the mainstream Democratic Party – it is you, not us, who has gone off the reservation.

 

As for Obama’s ethics, they are exceptionally high. While one can disagree with his policies, inexperience, etc., he has done nothing but bring honor to the office of the President.

 

As for the Clintons, they are slippery and have made many unforced errors. But in this way, they are smack in the center of the average high-level politician in this country. If you want to talk about crooks, I can give you a long list of Republicans (and yes, many Democrats) in Congress, in state houses, etc. who are equally if not far more crooked. Take the top three elected officials in Alabama, for example (all Reps of course), who have been INDICTED this year. Marco Rubio is owned, lock, stock and barrel, by a FL billionaire. Pretty much every Rep in this country is owned in a similar way by the Kochs and/or Sheldon Adelson. And don’t even get me started about Trump’s insanity and rottenness to the very core.

 

But I agree with you that I have to hold my nose a bit when I support Hillary.

 

6) Chaim Gulkowitz writes:

 

I’m a Republican, and the reason that you didn’t get much response is simple to all Republicans: The argument here is not about Trump, but about Hillary. We know what Trump is, and what he is not – sadly (or fortunately), it is precisely due to his faults that he is unable to hide his true nature.

 

Any support he gets is purely derivative of the ultimate disgust that Republicans have for Hillary; who is by comparison far worse.

Most Republicans feel that the country is at a moral crossroads, and that Hillary represents a continued descent in the moral fabric of our country. Trump’s brashness and disdain for politics can be viewed as “stopping the train,” which gives us a chance to regroup with a better candidate in four years.

 

In a weird way, it is his old fashioned bigotry which appeals to some who yearn for the “old fashion” America. This doesn’t justify and of his views and despicable character flaws, but it is the lesser of two evils argument.

 

Then there is the Supreme Court argument: say what you want about Trump, but as a Republican he will appoint conservative justices to the Court, and preserve (in our view) the integrity of the Constitution, etc., while Hillary appointees will likely shift the Court to the left for decades to come.

 

I will submit that Trump can be viewed as a parody for American politics. He is a clown, and immensely unqualified, but if elected, will probably not be able to hurt the country much. Which only drives home the point how ultimately useless politicians are, and at the end of the day, no politician can hold down the greatness of the American people.

 

In my view, Obama was equally unqualified, and his policies (Iran deal, Obamacare) were a best effort to hurt our country – and despite all of the political hysteria from the right, our country is still strong and prosperous.

 

7) Another reader:

 

It boils down to the devil you know. And for anyone with half a brain cell…..Hillary is a devil. Both she and her husband do not have an honest bone in either of their bodies. I do not want a President with the ethics of a snake.

 

That said, and though his personality scares me, I have yet to read anything about Trump’s ethics. What I do know is he has raised some very good children, doesn’t drink, and until this campaign, was home every night for dinner. I’m going to hold my breath and hope his big ego has something to prove to the American people.

 

My response:

 

I agree with you that the Clintons’ ethics are troubling – but I think Trump’s are far worse. I trust you saw the USA Today and WSJ articles on how he regularly stiffs his vendors (http://www.usatoday.com/story/news/politics/elections/2016/06/09/donald-trump-unpaid-bills-republican-president-laswuits/85297274/ and http://www.wsj.com/articles/donald-trumps-business-plan-left-a-trail-of-unpaid-bills-1465504454) and the NYT on how he screwed his stock and bondholders (http://www.nytimes.com/2016/06/12/nyregion/donald-trump-atlantic-city.html). And the sheer volume and audacity of his lies is truly breathtaking – see: https://www.washingtonpost.com/opinions/nobody-brings-the-crazy-quite-like-trump/2016/06/22/74ba5692-38bd-11e6-9ccd-d6005beac8b3_story.html

 

8) Another reader:

 

I cannot stand Trump, but comparing him to David Duke is a bit much. He’s an uncouth blowhard who changes his mind constantly. (I’m sure I don’t have to tell you that he has spent much of his life as a Dem…like David Duke :) If you don’t like what he says, wait five minutes and he will tell you something different. In any event, like you, I think he would be a disaster for the country.
That said, Hillary is a liar (Benghazi, her server, etc.), a felon in waiting, a Bill-enabler, a faux feminist, defended a child-rapist and laughed about it, is in the pocket of the teachers unions and is an all-around reprehensible human being.

 

As one who has always preached the virtue of voting for the lesser of two evils, I am stuck on this one. Both are hateful and equally evil. But then again, the election is still four months away, so I don’t have to make any decisions at this time.

 

9) Another reader:

 

I am no Trump fan. Nor am I a Republican. But a vote for Hillary is allowing the same old nonsense and corruption to continue. There is no more despicable person than Bill Clinton (what if Monica was your daughter?). He’s a liar! And as for Hillary – the servers – travel gate, Benghazi, etc. Hillary as a capable leader? I think Ambassador Steven’s family might have a different opinion. I sure do.

 

Whitney, I AM a card carrying member (or should I say hat-wearing member, since they don’t issue cards) of the CATO Institute. I believe as my good friend P.J. O’Rourke said “Giving money and power to government is like giving whiskey and car keys to teenage boys”.  It’s time for a big change, even if it takes an egotistical buffoon Trump to make it happen. I am betting on his ego and his image in his children’s eyes to do it. After all, Nixon and Johnson were no different.

 

10) Another reader:

 

So I guess I will weigh in, but not to support him. I just think your (and most) analysis of him and his faults are misdirected. HE is not the issue. He has tapped into an incredibly strong vein of feeling running through a good portion of the populace now (and, so has Bernie). If Trump got hit by a bus tomorrow, a similar character would pop up in his place. The folks that are scared of him, you should not be scared of him—you should be scared that half of your fellow Americans support at least some of his platform, and should he disappear tomorrow, that 50% of Americans is still there, and they still have those strong inclinations. The media is fixated on Trump and it is easy to do, given his characteristics, but really the American people should be the focus. It is no different than Nazi Germany in kind but certainly not degree—Hitler didn’t act alone, he had the support of a huge swath of the populace.  If it wasn’t Hitler it would have been someone else.

 

My response:

 

I mostly disagree. Yes, demagogues tap into pre-existing sentiments, but really skilled ones whip up passions – they bring out the worst elements in large numbers of people – that otherwise would have remained dormant. That’s why it’s so important to defeat Trump soundly. I shudder to think of the damage he could do as President to tear apart the fabric of our country…

 

His response:

 

I do agree people don’t do anything without leadership, absent someone to direct the passions nothing will happen.  My point is that there is an unending stream of demagogues.  If Trump is defeated soundly, the passions will fester more, and the next demagogue could be worse!  The question is why the passions are there and how to resolve them.

 

11) Last but not least:

 

I really wanted to vote Republican this year, but even if you took away all of Trump’s bigoted statements, I would never vote for him.  I dislike Hillary, but ABHOR Trump.  Between you and me, I think he belongs in a mental hospital.  Total narcissist, deeply insecure, no empathy or humility, lazy, uninterested and ignorant in policy matters, etc.

 

I’m still hoping that by hook or crook, Trump will be denied the nomination.  Regrettably, Trump is too much of a narcissist to drop out in the face of polls showing over half of Americans won’t vote for him.  If Trump ran a retail or manufacturing business (one with more moving parts) versus a real estate business, where one can rule by fiat, he would fall flat on his face.

 

I don’t see his hotel business doing well after his campaign.  I doubt many of Trump’s supporters can afford to stay at his hotels, and most other decent Americans will shun them.  Why would anyone choose to have a conference or wedding at a Trump hotel, when there are so many other options, is beyond me.