The 7 most epic shorts in finance history

Jorgé's picture
Rank: Neanderthal | 2,121

Going long a security has always had a wholesome ring to it; it says you believe in a company, you see a bright future for it, you stand by its management, and you back it up by investing in it.

Going short however has the stigma of nastiness; its Machiavellian, sinister, a bit like doing the old in out to an unconsenting devotchka or watching a new Tom cruise movie. It's wrong, leaves a bad taste in your mouth, and has been called "un-American".

Unlike Tom Cruise however, going short is awesome, and often leads to interesting stories.

Without further ado, here are the 7 most epic plungers in history.

Jesse Livermore, 1929


Shorted stocks during the 1929 crash all the way to the bottom to the tune of $100,000,000. But he came home to an empty house; his wife, who heard of the crash, feared they became insolvent and moved all their furniture and belongings to the guest house. Upon meeting Mrs. Livermore he said, "I made the most money I ever had today" and then had the stuff sent back.

Paul Tudor Jones, 1987


"It's going to be Rock and Roll." "It will have Wall Street in a tizzy and it will create headlines that will dwarf anything at this point in time." Hell yeah it did, Tudor gained over 80% that October alone shorting S&P's. PTJ, who was in his early 30's then, supposedly banked $100 million for himself.

Andy Krieger, 1987


In the aftermath of Black Monday, Krieger; a vegetarian, Sanskrit expert turned cheeseburger munching FX trader at Bankers Trust, set his sights on the New Zealand Dollar. Amassing a short position larger than the entire New Zealand money supply, he caused massive losses in local industries and turned the Kiwi into "a wounded pigeon." He worked for Soros the next year but quit before getting his bonus, setting stage for...

Stanley Druckenmiller & George Soros, 1992


If Black Wednesday was a horror movie, "Go for the jugular" would have been the last words the GBP would have heard before its screams. The Quantum fund spent two days selling the Pound out of the ERM, banking them a billion and naming Soros "The man who broke the Bank of England."

James Chanos, 2001


Enron.

David Einhorn, 2008


You know when a trades going your way when the price ticks the way you want it, and even more so when you get the CFO fired. Einhorn already had a name in the hedge fund world but when he publicly took down Lehman, and saw Fuld and crew burn to the ground, he cemented himself as a heavy hitter.

John Paulson & Paolo Pellegrini, 2008


Yeah, like there's anything you don't know about these guys.

So which of these was the greatest of all?

Would you rather have made $100 million shorting the world in 1929?

Or would you rather take down Fortune 400 companies?

Enjoy your weekend WSO.

Comments (44)

Dec 10, 2010

$100 million in '29 with inflation figured in just think about it

Dec 11, 2010
futurectdoc:

$100 million in '29 with inflation figured in just think about it

Wikipedia said it would have been between 1 - 13.7 billion in today's money.

Dec 10, 2010

All I'm sayin is those are some happy lookin pants in your picture

If I had asked people what they wanted, they would have said faster horses - Henry Ford

Dec 10, 2010

Gotta go with Soros...that was so badass seeing the PM have to acknowledge the devaluation... plus he made a Bill... pretty impressive

Dec 10, 2010

squirtlez shorting tlt and bp

soros though one man stood against tyrany

Dec 10, 2010

Of the 7 most epic shorts in the world 5 were credited to MC Hammer.

Oh, wait, wrong thread.

    • 1
Dec 10, 2010

2008: Bretton James uses his private accounts to short Keller Zabel down to $3 a share and then uses Chruchill Shwartz to fucking acquire them the next day. He pillages that place so bad that he gets Lou Zabel to kill himself, it was brutal. There was a really shitty documentary about it in theaters earlier this year, did anyone else see it? Let me try to see if I can find the title somewhere...

Dec 10, 2010
Nouveau Richie:

2008: Bretton James uses his private accounts to short Keller Zabel down to $3 a share and then uses Chruchill Shwartz to fucking acquire them the next day. He pillages that place so bad that he gets Lou Zabel to kill himself, it was brutal. There was a really shitty documentary about it in theaters earlier this year, did anyone else see it? Let me try to see if I can find the title somewhere...

please do

Dec 10, 2010
blastoise:
Nouveau Richie:

2008: Bretton James uses his private accounts to short Keller Zabel down to $3 a share and then uses Chruchill Shwartz to fucking acquire them the next day. He pillages that place so bad that he gets Lou Zabel to kill himself, it was brutal. There was a really shitty documentary about it in theaters earlier this year, did anyone else see it? Let me try to see if I can find the title somewhere...

please do

Toy Story 3

Dec 11, 2010

Tim Sykes or shorttheworld...

I win here, I win there...

Dec 11, 2010
Jorge:

Going short however has the stigma of nastiness; its Machiavellian, sinister, a bit like doing the old in out to an unconsenting devotchka or watching a new Tom cruise movie. It's wrong, leaves a bad taste in your mouth, and has been called "un-American".

i love all the devotchki, lol

"Seeing this house and your fine sword and hearing how you're importing and exporting chinamen, let me guess, you must be fucking rich."
Kenny Powdersss

Dec 11, 2010

David Tepper beats them all. His shorts gained him $4billion in 09, which is a tad bit more than inflation adjusted 100 million in 1929.

I am not cocky, I am confident, and when you tell me I am the best it is a compliment.
-Styles P

Dec 11, 2010
eokpar02:

David Tepper beats them all. His shorts gained him $4billion in 09, which is a tad bit more than inflation adjusted 100 million in 1929.

Wasn't he long financials?

People like Coldplay and voted for the Nazis, you can't trust people Jeremy

Dec 11, 2010
Jorge:
eokpar02:

David Tepper beats them all. His shorts gained him $4billion in 09, which is a tad bit more than inflation adjusted 100 million in 1929.

Wasn't he long financials?

Yes.

Dec 11, 2010

Jeez. I had no idea.

Dec 11, 2010

$100 mil in 1929 would have been ridiculous. He probably could have bought a state for that much back then.

Dec 11, 2010

$100 mil in 1929 would have been ridiculous. He probably could have bought a state for that much back then.

Dec 11, 2010

Currently reading einhorn's book about ALD and it's hilarious.

I vote for einhorn, AFAIK with the exception of soros he's the only one who really had any control over his success in that he actually pushed the companies into bankruptcy.

Dec 11, 2010
breakinginnew:

Currently reading einhorn's book about ALD and it's hilarious.

Is it? Was just checking it out on Amazon but I just ordered a lot of books so I dunno.

Not a lot of love for Paulson so far, was half expecting a few people to go Paulson is da man! or something. Guess a lot really does feel that it was just a fluke.

People like Coldplay and voted for the Nazis, you can't trust people Jeremy

Dec 11, 2010
Jorge:
breakinginnew:

Currently reading einhorn's book about ALD and it's hilarious.

Is it? Was just checking it out on Amazon but I just ordered a lot of books so I dunno.
.

Definitely. I actually started reading it because someone (I think kennypowerscfa) said on here that it was a good look at a start-up type hedge fund which i was curious about after there was some discussion of what it would take to start one.

If you want to decide if you'll enjoy reading it, watch the 20 minute clip on the website of the actual speech. (foolingsomepeople.com) because while very interesting, the book is very technical--actually I read a forbes article that reviewed the book and the author pointed out that if einhorn had focused more on the personal dramas etc and less technical aspects he would have a much broader audience...he also pointed out that the level of technicality is the reason why einhorn is a millionaire (billionaire?) and he isn't :)

In the foreword written by greenblatt, he says if it weren't for eating and sleeping or something like that, I would have read this book in one sitting, so take this for what it's worth.

Dec 11, 2010

Im going with Einhorn. I just re-watched his speech about going short on Allied Capital. He turned the conference into a comedy club at Allied's expense.

Dec 13, 2010

Soros and Druckenmiller take all of these.

Apr 24, 2014

These are the success stories, I wonder how many others lost everything going short.

Apr 24, 2014

Livermore's $100mm would be worth $125bn today if it was all put into the Dow and reinvested. Unfortunately he lost 95% of that sum in the next decade and then killed himself.

Apr 24, 2014

Fooling Some of the People All of the Time
Confidence Game
The Art of Short Selling
Financial Shenanigans

Apr 24, 2014

In addition to what @Anchor said, check out Pershing and Greenlight's investor letters and speeches (i.e. Einhorn's speeches disucssing Lehman)

Apr 24, 2014

Hmmmm....a large, successful short? I'm completely drawing a blank...

The Big Short: Inside the Doomsday Machine

Apr 24, 2014

The title that jumped straight to the front of my brain.

Apr 24, 2014

Echo the books suggested by Anchor.

Apr 24, 2014

http://amzn.com/0979549701

Dude ran the "#1 short biased fund"

Apr 24, 2014

Isn't this the book on penny stocks exclusively?

Apr 24, 2014

The Greatest Trade Ever

Apr 24, 2014

art of short selling is by far the best here

Apr 24, 2014

David Einhorn has the goods in this department. 'Fooling some of the people all of the time' is a great read about his short play on Allied. The Alpha Masters is another great read.

Money doesn't change people, it shows you who they really are.

Apr 24, 2014

I don't often look at other fund's 13-Fs, but the SHS does not stand for shares held short, it is simply the title of the share class...

Short positions are not required to be disclosed in a 13F

Short OPEN, NFLX, PCLN, CRM to name but a few...

Apr 24, 2014

13-Fs generally do not disclose direct short positions, and though option positions are disclosed the information isn't really enough to determine what the play is.
http://en.wikipedia.org/wiki/Form_13F
For example, this Greenlight 13-F shows options on Allied but not the direct short:
http://www.sec.gov/Archives/edgar/data/1079114/000...
Same with Lehman in this 13-F:
http://www.sec.gov/Archives/edgar/data/1079114/000...

Apr 24, 2014
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Apr 24, 2014
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Men are so simple and so much inclined to obey immediate needs that a deceiver will never lack victims for his deceptions.

-Niccolo Machiavelli

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