Morning Brew Daily
Short Seller Hindenburg Closes Up Shop & Bezos Enters the Space Race
Fri, 17 Jan 2025
Episode 499: Neal and Toby talk about the sudden closure of famous (or infamous) short-seller firm Hindenburg Research. Then, Jeff Bezos’ Blue Origin has officially entered the space race as it sends its first rocket into orbit. Meanwhile, MBAs are looking like they’re losing their prestige as even Harvard MBAs are having a tough time landing a job post-college. Plus, Nintendo is the Stock of the Week, while UnitedHealth Group is the Dog of the Week. Finally, Scott Bessent, Zyn, Tubi, and Duolingo are in the headlines. Subscribe to Morning Brew Daily for more of the news you need to start your day. Share the show with a friend, and leave us a review on your favorite podcast app. Checkout public.com/morningbrew for more Listen to Morning Brew Daily Here: https://link.chtbl.com/MBD Watch Morning Brew Daily Here: https://www.youtube.com/@MorningBrewDailyShow All investing involves the risk of loss, including loss of principal. Brokerage services for US-listed, registered securities, options and bonds in a self-directed account are offered by Public Investing, Inc., member FINRA & SIPC. Cryptocurrency trading services are offered by Bakkt Crypto Solutions, LLC (NMLS ID 1890144), which is licensed to engage in virtual currency business activity by the NYSDFS. Cryptocurrency is highly speculative, involves a high degree of risk, and has the potential for loss of the entire amount of an investment. Cryptocurrency holdings are not protected by the FDIC or SIPC. Alpha is an AI research tool powered by GPT-4. Alpha is experimental and may generate inaccurate responses. Output from Alpha should not be construed as investment research or recommendations, and should not serve as the basis for any investment decision. Public makes no warranties about its accuracy, completeness, quality, or timeliness of any Alpha out. Please independently evaluate and verify any such output for your own use case. Learn more about your ad choices. Visit megaphone.fm/adchoices
What happened to Hindenburg Research?
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Check out public.com slash morningbrew and get some alpha from Alpha. Paid for by Public Investing. Full disclosures in podcast description. Our first story goes out to all the short kings out there, and I'm not just talking about height.
Nate Anderson, the man behind the famed short-selling firm Hindenburg Research, tossed in the towel saying he was closing his firm due to the stresses of the job.
Hindenburg made a name for itself by going after the giants of the corporate world, including the Indian conglomerate Adani Group, the once high-flying hydrogen truck startup Nikola, and household names like Carvana, Icon Enterprises, and Jack Dorsey-owned Block. Between Block, Adani Group, and Icon Enterprises...
Hindenburg's deeply researched reports knocked as much as $173 billion off their market value. It's not easy to destroy that much value amidst one of the best bull runs U.S. equities have seen in decades, but Hindenburg's approach created a loyal following that allowed it to punch above its weight. Not all of its shots hit its target, though.
Since publishing a report about Roblox in October, the children's game platform has seen its stock rise 50%, and shares of its most recent target, Carvana, have recovered and are up about 5% this month.
Still, it's going to be weird living in a world without a Hindenburg report randomly dropping from the clouds and causing a ruckus kneel and shows that activist short sellers are increasingly becoming a dying breed.
So our first thought when this news hit the wires on Wednesday was that financial regulators are knocking at his door because short selling is not for the weak stomach. He launched this firm in 2017 and immediately was sued by three of the firms that he was targeting. There are legal challenges facing other short sellers as well.
Andrew Left, who's a very prominent short seller, is now was indicted for manipulating stock. So I'm not speculating at all. It's just this is the first thing that came to everyone's mind here at Morning Brew because short sellers are operating in a legal gray area. And many of them have just hung up the cleats in recent years because they say it's not worth it.
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