Short sellers ridicule fund managers' vanishing attention spans
investors
entrusted with others'
money
.
The study, Short Sellers' Information Acquisition, interviews nine prominent short sellers and analyses 820 short reports.
It confirms shorts are informed and skilled, yet much of their work simply re-examines public filings overlooked by other professionals, exposing how often investing experts miss the obvious.
Their edge lies less in uncovering new facts than in presenting evidence clearly. 'The best points come first', says Blue Orca Capital's Soren Aandahl.
READ MORE
'The collective attention span of market participants is horrible and has gotten worse over time. A few years ago, I would write an 80-page short report. Today, I laugh at that. No one gives a flying rat's ass about 80 pages.'
Concurring, another interviewee says less powerful information 'dilutes the powerful information. Let's say there's evidence of fraud, but then you add some minor issues – it makes the fraud evidence less powerful'.
Reports must be concise, their points distilled to survive a skim-happy readership.
Muddy Waters Capital's Carson Block describes his audience as 'hostile … They want you to be wrong'. Shorts must 'break through this hostility and make them realise they've been misled by the company's management'.
For short sellers, the challenge is less uncovering fraud than navigating a market that can be lazy, inattentive, and too quick to trust company claims.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Irish Times
5 hours ago
- Irish Times
Jerome Powell to deliver Jackson Hole address under fire on multiple fronts
Jerome Powell's speech at the Federal Reserve's August summit in Jackson Hole, Wyoming, is always a high-stakes moment. This year, the central bank's chair takes the podium under fire – facing fierce attacks from US President Donald Trump and a growing insurgency within his own institution. Trump has engaged in a months-long assault on Powell, calling him a 'stubborn mule' and 'numbskull' for refusing to cut borrowing costs this year over concerns that the president's tariffs will inflame inflation. Now, almost six months in advance of schedule, Trump has been gifted a chance to sow more discord within the Federal Open Market Committee (FOMC) by picking a loyalist to fill an empty seat on the Fed's board. Stephen Miran, the economist he has chosen to replace Adriana Kugler following her abrupt departure from the central bank's policy-setting board, has endorsed Trump's calls for interest rate cuts. He has also pushed for an overhaul in Fed governance that would hand presidents the power to dismiss the likes of Powell at will. READ MORE Analysts expect something like fireworks inside the ordinarily staid central bank. 'Miran is not somebody who's going to be enveloped in and overwhelmed by the traditions inside the Fed,' said Steven Blitz, chief US economist at TS Lombard. 'He will be the agent provocateur representing Trump at the FOMC. And proudly so. He'll make no bones about it.' It would make Powell's job in Wyoming on Friday, when markets will pore over every word in his speech, more complicated than normal. [ The moment Jerome Powell stood up to Trump a reminder how few dare to contradict him Opens in new window ] 'We are in this uncomfortable equilibrium, where we don't know where things go next,' said Gennadiy Goldberg, chief rates strategist at TD Securities. 'The market wants a bit of confirmation from Powell on Friday as to whether he is open to cutting rates.' Miran is not Powell's only problem. Christopher Waller and Michelle Bowman, two Fed governors who both made the Treasury's 11-person longlist to succeed Powell in May, dissented and backed cuts at the central bank's July vote. [ Scott Bessent calls for inquiry into 'the entire Federal Reserve institution' Opens in new window ] Assuming Miran is confirmed by the Senate in time for the September 16-17 Fed meeting, that would leave Powell facing three dissenters from within his own seven-strong board. A schism of that magnitude last occurred in 1988 – and would be seized upon by Trump and his supporters as evidence that the chair was losing his grip. Mixed US economic data is adding to Powell's dilemma as he seeks to balance the Fed's dual mandates of maximum employment and stable prices. The Teton Range seen from the Jackson Hole valley in Wyoming. Photograph: Ryan Dorgan/The New York Times Trump's sweeping duties on trading partners have yet to produce the sort of surge in inflation seen during Joe Biden's time in the White House, but they have clouded the outlook enough to leave rate-setters wondering if they have much room to cut. Investors leapt on a relatively benign consumer price index figure last week to fully price in at least a quarter-point cut in mid-September. But insiders view the Fed's vote next month as a far closer call than markets. While a gloomy jobs report for July has raised concerns about the health of the labour market, a hot producer price index figure brought worries that tariffs were about to hit US shoppers. Torsten Sløk, chief economist at Apollo Global Management, said tariffs had created 'a stagflationary impulse' that had complicated the Fed's job 'dramatically'. [ Will Donald Trump fire Jerome Powell? 'I don't rule out anything. But it's unlikely. Unless …' Opens in new window ] Some Fed-watchers say Powell's view would depend on whether he remains focused on the unemployment rate as the prime indicator of the health of the US labour market. At 4.2 per cent, the rate remains low, suggesting the sharp slowdown in hiring this summer might be down to supply-side factors, such as a fall in immigration, which the central bank can do little to counteract. Marc Giannoni, chief US economist at Barclays, said: 'Powell warned [after the July meeting] that payrolls could be close to zero, he also said the unemployment rate may not move up much because of supply-side factors. If he repeats that, then that puts the expectations for rate cuts back closer to 50 per cent.' Bets of a September cut have edged lower in recent days, to an 85 per cent chance as of Tuesday, on the back of the PPI report and Fed officials' comments that have tempered expectations. But doves argue that, at 4.25 per cent to 4.5 per cent, the Fed's benchmark range remains in 'restrictive' territory, limiting growth at a time when the US labour market might be on the turn and the economy showing signs of slowing. More bad data on jobs would raise the prospect of the likes of Waller backing a jumbo 0.5 percentage point cut – in line with calls from US Treasury secretary Scott Bessent for more aggressive action. Trump's demands, meanwhile, remain extreme: he wants borrowing costs slashed to just 1 per cent, claiming this would save the government hundreds of billions of dollars on debt repayments. 'I don't think the Department of Finance have any respect for the tourism industry' Listen | 41:44 The big question for Miran is how he would keep pushing for such steep rate cuts while coming across as credible. He struggled in April to reassure investors during a market eruption after Trump launched his trade war, and previously wrote about the merits of devaluing the dollar and a so-called Mar-a-Lago accord to realign the global economy. 'He's there to try to see how far he can shift the Fed's 'Overton window',' said Derek Tang, of LH Meyer, referring to the concept that describes the range of ideas considered acceptable in public discourse. Miran, now chair of the Council of Economic Advisers, will not attend Jackson Hole, though his fellow council members Pierre Yared and Aaron Hedlund will be there. Ed Glaeser, who taught Miran microeconomics in his first semester at Harvard, expected his former pupil to echo the president's calls for rate cuts, but played down the degree to which he would be a disruptive force within the Fed. 'I suspect he would not be nominated if he did not believe that he should be cutting rates and he will certainly come into it with a pro rate-cutting view,' Glaeser said. 'But he will listen to his colleagues and do his best to be a decent member of this group.' – Copyright The Financial Times Limited 2025
Irish Times
12 hours ago
- Irish Times
US government investment in Intel looks bad for Leixlip
Intel is getting the Donald Trump treatment. Two weeks ago, the president of the United States called for the resignation of Lip-Bu Tan , the recently appointed chief executive of America's flagship microchip maker. 'The CEO of INTEL is highly CONFLICTED and must resign, immediately. There is no other solution to this problem,' he blasted on his Truth Social account. The reason being the connections of Tan – a US citizen born in Malaysia – to China, including the sale of chip design products to a Chinese military university by one of his businesses, Cadence. The writing was on the wall for Tan, but four days later he was invited to the White House. All talk of his resignation evaporated and was replaced by the suggestion that the US government would take a direct stake in Intel as it tries to reinvent itself, having missed out on the boom in chips to power artificial intelligence. Depending on where you stand on Trump, the proposal is either further evidence of his business acumen and deal-making skills or more proof of his erratic temperament and general unsuitability for office. READ MORE Few details have emerged of the proposed investment, but Intel shares – which have lost half their value over the past couple of years – are up strongly on the news. It's hard to gauge what the consequences of the investment would be for Intel's Irish operation in Leixlip, which seems to have escaped the worst of the cost-cutting measures introduced by Tan when he took over in March (although it was reported in July that almost 200 mandatory redundancies would be implemented this year at the Leixlip plant). [ Trump administration in talks to take 10% stake in Intel Opens in new window ] The best guide is the deal that Trump made to allow Japan's Nippon Steel take over US Steel, the iconic American steelmaker. Trump insisted on the federal government getting a so-called golden share, which gives it the right to appoint an independent director and also a veto over some investment decisions. These include the transfer of production and jobs outside of the US as well as 'certain decisions on closure or idling of US Steel's existing US manufacturing facilities, trade, labour and sourcing outside of the United States'. There are cosmetic measures such as keeping the name US Steel, but the import of the agreement is clear. It is to safeguard US jobs and maintain domestic capacity in a strategic industry in the interest of national security. It is hard to see how a significant investment in Intel – which is also being promoted on national security grounds – could come without similar strings attached, which in turn would have to militate against significant new investment in Leixlip. If the rationale for the US government taking a significant stake in Intel is to ensure that the country boosts domestic chip-making capacity, why put money into Ireland? The ability of Intel to resist Trump's overture – even if it wanted to – is limited. The company is haemorrhaging cash and before Tan's appointment was contemplating splitting off its chip-making arm to focus on chip design. This is the model adopted by more successful rivals who have wiped it eye on AI chips. Tan seems committed to staying in the chip-making business although he has made this contingent on finding customers for its two latest chip-manufacturing processes known as 18A and 14A. Both processes are based in domestic plants in Oregon and Arizona, which received billions of dollars' worth of investment under the Chips Act brought in by the Biden administration. The Act aimed to bolster domestic chip manufacturing. Leixlip has been touted as a possible site for 18A manufacturing but there does not seem to be any progress in that regard. To date, Intel has failed to find enough third-party customers for its new manufacturing processes and remains its own biggest customer. Unless it can find more customers, its business model is simply not viable, hence the weakness of its share price over the past two years. The presumption is that once the US government is on board as a shareholder – a 10 per cent stake worth about €10 billion has been touted – Trump will pressurise other US companies such as Apple and Qualcomm to become customers of Intel. They currently source chips from manufacturers in Japan and Taiwan. The jump in Intel's share price and the decision by Softbank to take a 2 per cent stake in the business on Monday reflects the obvious short-term benefits of the Trump administration bullying other US firms to become its customers. More red-blooded capitalists have warned that the US will fall into the nationalisation trap whereby a government decision to prop up an uncompetitive national champion weakens the economy long term. But if things continue to unfold in this way, it looks likely that Intel's Leixlip plant will, at best, be left to wither on the vine as future investment is focused on boosting manufacturing capacity in the US. Alternatively, Trump could change his mind in the morning.
Irish Times
2 days ago
- Irish Times
Short sellers ridicule fund managers' vanishing attention spans
A new study of short sellers paints an unflattering portrait of the professional investors entrusted with others' money . The study, Short Sellers' Information Acquisition, interviews nine prominent short sellers and analyses 820 short reports. It confirms shorts are informed and skilled, yet much of their work simply re-examines public filings overlooked by other professionals, exposing how often investing experts miss the obvious. Their edge lies less in uncovering new facts than in presenting evidence clearly. 'The best points come first', says Blue Orca Capital's Soren Aandahl. READ MORE 'The collective attention span of market participants is horrible and has gotten worse over time. A few years ago, I would write an 80-page short report. Today, I laugh at that. No one gives a flying rat's ass about 80 pages.' Concurring, another interviewee says less powerful information 'dilutes the powerful information. Let's say there's evidence of fraud, but then you add some minor issues – it makes the fraud evidence less powerful'. Reports must be concise, their points distilled to survive a skim-happy readership. Muddy Waters Capital's Carson Block describes his audience as 'hostile … They want you to be wrong'. Shorts must 'break through this hostility and make them realise they've been misled by the company's management'. For short sellers, the challenge is less uncovering fraud than navigating a market that can be lazy, inattentive, and too quick to trust company claims.
