Time to take stock.  As I write this the movers are dismantling my elegant, penthouse offices here at 1 Hedgefund Tower.  Soon, I will be forced to work remotely from one of my homes in the Hamptons, Big Sky or the Caymans.  I’d say the Caymans is looking like the choice … that is, unless Steve Cohen returns my calls.

I still can’t understand what happened.  My team had shorted the shares of a relatively obscure retailer with an outdated, pre-covid business model.  I ask you, “Who still goes to the mall to buy and trade video games?”  Per established practice, we flooded the media with stories about the retailer’s imminent demise.  We weren’t manipulating the stock price, mind you, we were performing a public service.

Then the doormen let the barbarians into the clubhouse.

The nerve of those yahoos. Market neophytes are not supposed to concern themselves with our short sales positions.  John Q Public should be happy investing in mutual funds with high front end/back end fees and below average returns.  After all, that’s why such funds were created.  (OK, that and to pay people like me excessive management fees.)  But for these newcomers to use social media and call options to orchestrate a run-up in a company’s share price, well, that’s manipulation.  Pure and simple.  There should be law against (non club-members) doing such things.

Most disturbing to me is the fact that these Johnny-Call Option-Latelys have seriously harmed the club’s image.  My fellow members and I have spent decades and untold billions touting the fact that the markets are incredibly efficient.  Why no Covid-driven stock decline?  The incredibly efficient markets had already taken such a pandemic event into consideration.  Now, these cell phone toting, Reddit stock jockeys are making market efficiency sound like an oxymoron . . . kinda like clean coal.

So, here I am packing up a lifetime of memories.  Reminds me of how we used to repackage non-performing mortgages into sure-to-fail, mortgage backed securities.  Oh, but I digress.  Still, I can’t help but think that were my current firm publicly traded I would short it.

Ponder that, Reddit.  You couldn’t beat me on that one.


Peter Dragone - Co-founder of Keurig.