In their recent episode of the VALUE: After Hours Podcast, Brewster, Taylor, and Carlisle discussed Michael Burry Shorts $AAPL. Here’s an excerpt from the episode:
Tobias: Burry’s Short Apple?
Bill: Who is?
Tobias: Mike Burry.
Bill: Oh. Got to be an easier short out there than Apple.
Tobias: Yeah, I don’t know if I’d be. I don’t know it’s going to be shorting.
Bill: Fine. I get it. Smart, fine.
Tobias: To hedge the rest of your book?
Bill: Yeah, I don’t know. It just seems like–
Jake: That’s got to be cheaper and easier to just like short the S&P 500– [crosstalk]
Bill: Write or something. I don’t know.
Jake: What if he is really long Berkshire and then that’s a little stuff–? [crosstalk]
Tobias: Just hedging out the Apple.
Jake: That might make some sense.
Bill: That would make a little bit of sense to me. I could dig that, but just straight up saying, this is the company to short seems that one’s tough for me.
Tobias: When I look at the big tech names or the big names in the index, then that’s the one thing that makes me think that the– [crosstalk]
Jake: Oh, no.
Tobias: Oh, let’s give it away.
Jake: Peek behind the curtain.
Jake: Like the telescope.
Tobias: Yeah. The telescope still back there. Makes me think that maybe the index isn’t that expensive. I don’t know. Every other long run indicator of the index is the index is really expensive until I drill down into those top five, or six, or 10 names and I don’t think it’s too bad. But then the problem was doing– [crosstalk]
Jake: But this is the story of history, though. It’s always been businesses that were working really well-
Tobias: That’s true.
Jake: -that were indomitable, that were– [crosstalk]
Tobias: To be fair, though, it has been like Exxon. Exxon stretched to the top, whereas these are better businesses than Exxon.
Bill: Yeah. My bias is to say the index does fine. I think it’s the internals of the NASDAQ that could cause some snap.
Jake: Does that mean it’s a stock pickers market?
Bill: I don’t know. I’ve been saying it forever. The index been kicking my ass. So, it’s probably just an indexers market is probably the answer.
Jake: [laughs] Oh, man.
Bill: It wins again.
Bill: But I don’t know. It’s probably, an ETF out there that people could find that’s better than the index. I have no idea where they would find such a thing.
Tobias: I think that those things exist. I just don’t know that it’s mattered that much. Mike Green flows thing seems to have been– I don’t personally agree with Mike’s thesis, but I do think that it is explaining what is occurring. I know that doesn’t make any sense, but I do think it’s going to be right until everybody decides no longer to flood the spy or smash the bid on the spy.
Jake: Flows before bros.
Tobias: It flows before bros, yeah.
Bill: Well, his thesis gets interesting when people stop flooding the spy. That’s when you want to have cash if you believe that stocks are actually fractional ownerships and businesses.
Tobias: That’s ongoing, right?
Jake: If it that’s a bet?
Bill: [Laughs] Yeah. Obviously, it’s all just arrayed straight. I get that.
Tobias: Well, there’s a flow. Well, the flows are to the index. It still things that are making lots of money that aren’t in the index. You don’t have to be buying them because the stock price goes up. You can’t buy them for the underlying business qualities they have. That’s still about–
Bill: That is an interesting concept. One that we should double click in next week.
Tobias: We should get into that. All right, we made it, fellas.
Jake: Oof. Drop something, Bill.
Tobias: Slid in over the line.
Bill: Oh, wait. No. No, I don’t know what we are looking at. [applause] There we go.
Jake: Yay, there it is. We got some work to do on our starboard.
Bill: I’ll have to label these.
Bill: Yeah, my bad.
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