Name: Fooling some of the people all of the time
ISBN: 9780470481547

Fooling some of the people all of the time

How far will some unscrupulous companies go to keep the truth about their dealings from the American investor? Farther than the eye can see, according to this account by Einhorn, the founder of Greenlight Capital, a long-short value-oriented hedge fund. Einhorn's firm has achieved greater than a 25 percent annualized net return for its investors since 1996, proof that Einhorn can literally put his money where his mouth is. At a charity investment conference he did just that, and told the world he had become alarmed by the practices of Allied Capital and had sold it short. The result was near-chaos for Allied, but its minions retaliated through powerful connections in Washington, resulting in Einhorn being investigated by the SEC. In the meantime, Allied continues on, making Einhorn the target of its anger.

What Hacker News says

feynmanalgoJul 2022

Fooling Some of the People All of the Time: A Long, Short Story by David Einhorn is one of my favourite books.

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ericmayJun 2022

Highly recommend Fooling Some of the People All of the Time by David Einhorn here as relevant reading.

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njessopMay 2022

two from finance:

Confidence Game: How Hedge Fund Manager Bill Ackman Called Wall Street's Bluff // Christine Richard

Fooling Some of the People All of the Time // David Einhorn

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catominorMar 2022

I really enjoyed Fooling Some of the People All of the Time by David Einhorn. He goes clearly and deeply into his suspicions about Allied Capital, a company that he thought/thinks had unethical/illegal accounting and business practices.

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ericmayMar 2021

> Sorry, should have clarified "government bonds" here.

Sure, no problem. But what about when the government does bad things and gets sued? At least something to think about.

I think some of the things you're discussing here are still fundamental government enforcement issues. You can create a "proper oversight" index but that doesn't shield individual investors. Facebook would have been part of that, for example, but now things have changed and the company could be open to liability for damages. I think the main issue here is there is too much risk for individual investors - they can't be experts in every stock or research every company - or get out if they start to see a pattern of fraud. So the only people who will own companies will be wealthy individuals and institutions that can fight lawsuits.

I also don't think this solves the concentration of wealth to the top companies. You can be a small, highly ethical company but not be able to raise capital in the public markets because investors are too risk adverse.

In my view, I think if you believe that there is a lack of oversight and a financial incentive to default, then you need to go back and look at how the government enforces rules that already exist before blowing up the entire capital markets for regular people. They seem to work pretty well, overall. Government bonds pay nothing now - if every investor had to exit the market (me and you) we'd just be stuck with useless dollars and no means to deploy them.

If you haven't read it, Fooling Some of the People All of the Time is a great, but also depressing read into this.

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KerryJonesJan 2021

^ This.

A great book on a specific example is David Einhorn in "Fooling Some of the People All of the Time". He routinely finds fraud and shorts them, in this case, Allied Capital.

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