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Not sure Burry priced in TSLA's cryptocurrency play, which (imo) was a giant volatility hedge that will help them make their numbers, and also, oddly, an invent
by motohagiography 5y ago
Not sure Burry priced in TSLA's cryptocurrency play, which (imo) was a giant volatility hedge that will help them make their numbers, and also, oddly, an inventory liquidity hedge that could be used to bludgeon shorts trading on sales data.
Burry is probably right about the market for electric cars and TSLA's exposure to raw materials prices and china, but he's wrong about the strategic ability of its leadership.
- motohagiography 5y agoNot to self-reply, but this idea of having an opaque and highly volatile basket of cryptocurrencies on your balance sheet might be important. It's not cash, and it's not inventory, it's something more powerful. It means you can sell tranches of it to make your quarterly numbers do what you want them to, with a crypto-hammer you can use to shore up numbers wherever you want. As an accounting device, their liquidity and volatility means you could use them to obliterate shorts by uncloaking a realized massive "profit" just before an earnings call. Crypto can absorb loose cash that creates other liabilities, while carrying the value of that cash over calendar years in a super liquid asset. I'm not a corporate accountant at all, but I would wonder if these properties of crypto could be used as a superweapon against shorts.