Jim Chanos, Kynikos Associates, talks about his short position in Tesla and what he thinks about the company’s prospects for the future.
Q1 hedge fund letters, conference, scoops etc, Also read Lear Capital: Financial Products You Should Avoid?
Welcome to our latest issue of ValueWalk’s hedge fund update. Below subscribers can find an excerpt in text and the full issue in PDF format. Please send us your feedback! Featuring Point72 Asset Management losing about 10% in January, Millennium Management on a hiring spree, and hedge fund industry's assets under management swell to nearly Read More
Jim Chanos on Musk: He's making cars at not enough gross margin to make money
How much longer can you keep the Tesla short on?
Oh I think most short positions you can keep on indefinitely. There's no timeframe on them it's just a matter of price and your willingness to hold and either take temporary losses or book profits so there's no timeframe undershorts. And Jim what's your take on the fact that you know Moscow has just bought more shares is that two your conviction at all and wanting to be short and in particular his comments his actions of the last couple of months. I guess you could say his negative comments are what analysts in the media for criticizing. What's your take on all of that. Well I think it's interesting more interesting was the fact that he had an annual meeting last week and as usual for Tesla lots of predictions were made and lots of futuristic shall we say hype. But but somehow the company and its leader could not see the immediate future and see the layoffs that they are about to announce a few days later. So again it's it's often this matter of it's about it's about the future. It's about keeping investors focused on. Some point out in the future when they hope the company will be profitable. But the fact of the matter is as the company is not profitable from operations the company will pull out all the stops will do a lot of one time items we believe to show a gap profit in the third quarter but they are just that one time items and the basic problem is is that he's making the cars not enough of the gross margin to make money.
And that's before the competition rolls out which is late this year and early next year.
Chanos: China Happy To Take Up Any Leadership Mantle The US Gives Up
Jim Chanos, Kynikos Associates, talks about his short positions, tariffs and dealing with China.