Melvin Capitals, Gabe Plotkin, Warren Buffett discussed on Networth Radio
Because theaters were shut down, right? And they're going to lose $5 this year. So last year was $33 loss this year $5 except they're losing $5 a quarter in the most recent quarter, and, of course, there's almost no revenue. And there's dead. The debt is 400% of capitalization, or it's 400% of equity. It's a E. I mean, bankruptcy is a good option for a company like that, right? Yeah. And There was they raise some capital, which started this back to your point. So it was about 300 million in a convertible unsecured bond. This is a Warren Buffett move on the part of a private equity down. So they loaned him the money with a call option. Of course, they've are with a convertible option. Like like a warrant, like a Warren Buffett warrant. And Of course, they decided to exercise you know there. Yeah. They probably got their warrant at Less than $3. And when I got to 15 of it, they were like, Hey, it's there. So AMC was one of them. If you can't play it like that, then it's probably not worth You know, betting a turnaround. There were a lot of people that called us on J. C. Penney. Ah, and that didn't work. Longer Term. Yeah, There's some people that Had some pretty strong conviction that G. C. Penney would turn it around. And, Yeah, sounds good trading lesson Read. It's Wall Street bets, message boards. That's a new force in trading, okay? Yeah, it is it. Here's Here's the zero hedge article. Okay. Okay. So first casualty of the big short squeeze. Melvin Capital. They've got picture of Melvin right here. Okay. Melvin capitals, Gabe Plotkin. We'll just call him now that he's famous now, uh, in a bad way massive losses on its shorts set to receive a $2.75 billion capital injection. From Citadel, one of the big guys and 10.72 investors. It's a bailout s o. He could pay is margin call. Which okay so alternative investing sometimes doesn't work. Um, and the long short strategy. Think is dead for a long time, because the results weren't that good for the category, right? Um they weren't that good. You know, the high yield index was better. If you take it is a category and now it's proved to be extraordinarily dangerous because you've got a whole group that realizes if a bunch of people bet the stock goes down in short, it Then then, here we go. Um, this is interesting. Neo AMC plug power, Blackberry bed bath and beyond. Papa Dean mentioned bed bath and beyond. He was He was having some fun with this, By the way, was he? Yeah. I don't know how much I don't know how it how he did. We can ask him because he'll be on later in February. Okay? Okay. We don't have to ask him because he's had that for for awhile. Had me Yep. That Z. Well, and he had done. He had done something with options, but I don't want to. Well, I don't know if you want to talk about if he didn't make money at it, Okay, You know, maybe he does. I don't want I don't want to scare him off. Okay? All right. What's next? Michael Burry calls game stop. Unnatural and insane. The rally. Okay, so next economic growth. Let's get to some. Let's let's get to some economic news here. We've got important forecasts, too, so economic growth came in at 4%. Atlanta Fed was wrong, They said. It could be a size 11, but you had the additional shutdowns. Yeah, now. California, New Yorker reopening Well, I think you get first quarter numbers and they're probably 10 or 11. Okay, Well, that's good. Yeah, OK, but that's coming off a pretty weak comp. If I look at last year's Q one and cue to actually mean we're gonna We're gonna get some pretty good numbers, I think. And so that says, first two quarters. Good. Yeah. Okay, So let's get to John Hook on institutional research source. Yeah. Somebody who's a lot of fun and He's been on the program from his Manhattan We'll call it a penthouse. I don't know if it's pretty house or not. But anyway, you get gets a lot of money for his research, and he was spot on on this thing so Um, give us the takeaways, and then we'll take him apart. All right. Dominant force for stocks is likely that the stimulus near record large rally for at least two quarters. Then he says, crash later, probably from inflation, He said. What crash from inflation from inflation? Yeah, it's a bold statement. Well, I'm not email him right now and say OK when Uh, exactly what.