In what was perhaps the most uneventful Ira Sohn book-talking conference in years, some of the biggest hedge fund names came, and as expected, talked their book. There were few surprises, perhaps with the exception of David Einhorn who may have pulled an Ackman and revealed his disdain for Pioneer Natural Resources, which sent the name and the fracking sector lower if only briefly. Indicative of the broader state of the “market” Einhorn was also the only person who pitched a short.
Einhorn’s problem, perhaps in line with all those who hated Chesapeake in 2012 is that he still thinks fundamentals matter when in reality a money-losing corporation can exist in perpetuity if it merely finds enough yield-starved junk bond investors – those who bought the Greek 5 year bonds a year ago shoud suffice – to fund the endless cash drain with other people’s money.
It remains to be seen if the Pioneer will now surge in an attempt to force squeeze Einhorn, the way Icahn did with Herbalife over Ackman’s infamous short.
This post was published at Zero Hedge on 05/04/2015.
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