Hedge Fund Titan Steinhardt Says He Would Sell GM Stock "As Quickly As I Can"

Tyler Durden's picture

On one hand you have Phil Lebeau. On the other you have legendary hedge fund investor Mike Steinhardt. When asked whether he would sell a hypothetical allocation of GM stock, Steinhardt's response is about as priceless as it gets: "As quickly as I can. I don't think one should be a long-term holder in government securities, particularly government equity securities." q.e.d.

Fast forward to the end

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Ragnarok's picture

Awesome, the truth/common sense  is so refreshing.

ZeroPower's picture

Excellent info re converts by Larry McDonald as always... and classic Steinhardt at the end of the clip. Simple, concise... Win.

Divided States of America's picture

CNBC ran this segment a few days ago about how the retail investors cant get into the GM deal while institutional investors got allotted with most of the GM IPO. Then they said that they will expand the IPO so that other investors can participate with CNBC hyping the deal saying that its oversubscribed and that the price range has been increased. The whole reason for this is that there really is no demand from the institutions OR that the institutions plan to dump this POS (like Steinhardt mentioned) the second it starts trading and they need the retail guys to become the bagholders. Typical Wall Street games at work here.

Pladizow's picture

The old "Take Away"

No you cant have any x 100.

Oh, wait we do have here some for you.

Do you still want it?

And the pigs eat the shit!

hedgeless_horseman's picture

Yes, this is good stuff.  I SWEAR I WILL NEVER BUY A GM PRODUCT

However, on a much more important note, Pladizow has seemingly accomplished what I had thought practically impossible.  (S)He has upgraded his/her avatar.  Applause.

Pladizow's picture

If by "Upgrade" you simply mean vertically higher on the female anatomy, then I agree with you.

gmrpeabody's picture

I thought those were slingshots... ;)

Aristarchan's picture

I was opting for trebuchets.

StychoKiller's picture

No matter which way you look at them (preferably up close, with slobbering!), you could put your eyes out wit those! :>D

ZeroPower's picture


The primary market always leads the secondary (stock exchanges) market.

As for the institutional demand, ive spoken with a buy-side friend who said his co has about $20MM allotted for the bonds. They can of course hedge these, as Larry mentioned on the show, by shorting the shares.

So, the demand i'd say is there, but who knows for how long.. Thats why Steinhardts AM fund has some dough it in as well. Youd be a fool not to take a few points from the offering.

Waterfallsparkles's picture

If you want a Government owned stock buy Aig, Fre, Fnm.  They are a lot cheeper.

monmick's picture

Is this the same Larry McDonald who used to play for the Leafs?

redpill's picture

This could be the most epic pump & dump ever.

Cruel Aid's picture

Pump, yes

Dump, on us. We're going to be the buyers of a failed IPO.

One way or another it will work.

Its about the Volt, a luxury Prius!

DoChenRollingBearing's picture

I have to agree about GM being a terrible stock to buy.  Actually it would BENEFIT our business if GM is able to come back, kicking butt, as there are few GM cars in Peru and we sell many of their bearings.

There is so much over-capacity in the auto production that I would buy NONE of them except for maybe Hyundai (the stocks).

Cruel Aid's picture

I would love for GM to pull their head out of their ass, but they refuse to sell anything small/mid and affordable to the average American, due to the legacy and union overhead, I guess.

Ford has been on this, while Chevy goes big. Now a $40 K Mega prius. Fix your model or your done GM.

Same old song and dance.

I drive a 3/4 ton Silverado. I have been puzzled by GM's model for years. My wife doesn't like driving a tank!

gmrpeabody's picture

They got burned the last time they went small. They were confused by thinking economy meant chintzy. Japanese ate their lunch. Have been ever since.

NotApplicable's picture

It will be interesting to see how many failures to deliver it takes to keep the price propped up.

tony bonn's picture

i'm trying to find out what happened to all of that equity in east german and soviet automakers. that might give us a clue as to what will come of the amerikan government automakers.

Cleanclog's picture

Or the Yugo.  Skoda still exists as does Lada.

Joe Davola's picture

Good to know, but what happened to Tinkywinky?

StychoKiller's picture

The target audience (children under 4!) wouldn't know or care about such things. :>D

economessed's picture

Why stop there?  Why not sell every stock as quickly as you can?

cowdiddly's picture

Sorry Steinhard. 1000s of HFT computers will beat you to sell this POS once Goldman gets out of their MOTHER OF ALL PUMP AND DUMPS of course.

And, todays headlines from AP states that they are raising the IPO price due to invester demand. AAAAAHHHHAHAAHAHAHAHAHAHAHAHHAHAHAHAHAHAHAHAHA.

StychoKiller's picture

What if you threw an IPO and nobody bought?  Chrylser actually builds vehicles the wife and I bought:  Jeep grand Cherokee and Dodge Dakota pickup (1990).

Cleanclog's picture

Absolutely.  Can their be anything worse than holding government equity paper at a time governments are going to be unable to service their obligations, even while they continue to buoy banks.  Look at Ireland.  Would you buy their Waterford stock?  Oh, you can't.

unwashedmass's picture


that was hysterical...i was watching....really solid, solid work pumping their brains out for the IPO, even projecting a fast three buck gain on the open to get all the pigeons in and holding fast....

and Steinhardt nukes it. glorious.

Poundsand's picture

You could just see them all deflate like the auto-pilot in Airplane.  And here they were expecting Steinhardt to bend down and blow as well and then ... ssssssssssssssss

Blano's picture

Thank you for today's laugh.

redpill's picture

You can always tell when the yammering heads hear something they don't like because for one brief second they actually stop yammering as they have a little temper tantrum in their head that their guest didn't say what they wanted them to.

Sam Clemons's picture

hahaha, i loved that too.  the other guys are talking about all these different metrics to measure the potential success and then Steinhardt says one sentence only and everyone shuts up.  classic.


F looks like its about to get slammed too.

Mr Lennon Hendrix's picture

Government equity sucurities.

cougar_w's picture

The churn on the GM IPO is going to be epic. Record breaking. Nobody is going to hold that crap. The HFT algos are simply going to go ape-shit with it. My guess is it will rise like a Saturn V rocket for the first few days with a billion shares traded -- the same shares over and over -- and then it will crater.

ZeroPower's picture

Yup, probably a few days of bliss, maybe a week, to catch the weak retail shorts after ex-3 for shorting expires.

Cognitive Dissonance's picture


I'm very impressed with your creative writing skills my friendly feline. You mentioned you're working on a chapter about Diamond taking down a bank. Are you thinking of publishing or are you just playing with the catnip?

Either way, it would help to get some exposure and I suspect the bank robbery story would fit in nicely here on ZH. I could guest host your piece. The one you showed me from yesterday was brilliant. Please post that link again for the crowd to savior.

cougar_w's picture

You are too kind.

Yes Fortran and Diamond will shortly knock over a bank. It's actually kinda funny. And a "deserving person" will be (ever so slightly) set on fire, so that's pretty cool.

The story installment from yesterday:


I like Diamond a lot, she's fun to write for, but she sometimes scares the crap out of me.

Cognitive Dissonance's picture

It's often scary channeling the inner feline when we've been taught all our lives to repress it. With the human animal, the inner female is the dominant position regardless of whether we recognize it or not. I suspect this is the reason we males have been repressing our females for thousands of years. We must destroy that which is closest to us, beginning within if we are to continue to deny what we are. This is the true human Achilles Heel.

It's always interesting to see how males like to destroy what the females have created, meaning life itself, be it human or nature. I can't help but be deeply saddened as I watch how our females have grown in social influence while being conditioned to reject their female side and join the boys club. The only thing worse than a male repressing his inner female is the female repressing her inner female. This turning point is where humans have recently gone full retard.

carbonmutant's picture

I think that most of that behavior is age dependent.

Cognitive Dissonance's picture

I would be interested in hearing you expand on your thought. But I've found that insanity isn't age dependent. Our inner sociopath just mellows a bit with age.

carbonmutant's picture

Humans are driven by hormone dependent decision systems.

And those hormone levels change with age; esp. the testosterone/ estrogen ratios. As males age the testosterone levels drop thereby increasing the ratio of estrogen. After menopause the opposite happens in women when their estrogen levels drop, which is why estrogen replacement therapy is so popular in women.

The end result of these hormone changes is a change in behavior. Younger males with higher testosterone levels are much more aggressive than older males or females. Testosterone gives them the confidence to take risks… some they shouldn’t take. But without people taking those risks we’d still be Neolithic. Obviously hormone ratios can have wide variations in the same gender.  Some males have much less testosterone and some females much more than normal.

It's much easier to acknowledge your inner female when your testosterone levels taper down to more manageable levels.

Interestingly enough all humans are born female. It's the release of testosterone by the mother during fetal development that causes the male to drop his ovaries.

This might make interesting reading. The genders are wired differently.


Cognitive Dissonance's picture

There is no doubt the sexes are wired differently. And I was very aware of the hormone levels. When I tell people that all fetuses start as females, most women are aware of this and most males are almost insulted when they are told for the first time.

Just goes to substantiate my basic premise, that males are mostly in denial of their female side and go to great pains to repress it. Right down to male posturing and excessive/aggressive shows in order to mark their territory and prove they are all male.

ibjamming's picture

We don't ALL start as females!  Males have an X and a Y chromosome...they're males from the first split of the fertilized egg/cell.  We LOOK female because that's how we develop...those aren't OVARIES ready to drop in males...they're BALLS!  They just developed where the ovaries develop.  It's easier to start with 1 basic form and modify it later.


Not trying to be a prick...just setting the record straight! 

kiwidor's picture

I think you've been reading too much BS.  Read this to reset the organ;


If you really want to see the unregulated, unrepressed woman...come to NZ.  There's plenty of them, please take as many with you as you can.


cougar_w's picture

The equality-theory (as I will call it) is not embraced on the grounds of any startling facts which have only lately come to light.

It needn't even be a theory. Occam's Razor is very much in play here; the obvious point to start from is simply the proposition that men and women are of equal intelligence, there being no obvious reason to assume otherwise. The same applies to people of color, people of different regions, the people's of other historical eras, and people of difference occupations. There being no obvious reason to assume otherwise. That right there is the key.

I think that if I could hazard a generalization, then it would be that people who think of themselves as intelligent think a lot about intelligence. And people who don't worry about such relative things don't dwell on the topic at all. But doing so or not is itself not an indication of intelligence as much as it is ego. And there is nothing wrong with that either, it's just how people are. It is always useful to understand how people are.

Intelligence itself is actually a red herring. I've yet to see a convincing argument that someone has uncovered the one, true measure of intelligence. And I've heard quite a few arguments. Intelligence as a human quality is elusive, mercurial and highly subjective. That's not even my personal opinion, that is simply how intelligence is, and people possessing any significant amount of life-experience will tend to agree and then laugh and move on.

That's just how it is. You don't have to be a genius to get to that point of acceptance. Though I suppose I'd have to admit, it helps.

ibjamming's picture

Some groups sure as hell do a lot better than others...there's got to be SOMETHING different about them...right?  Personally, I think there are HUGE differences between men and women and the races...but that's just real world experience talking...nothing official.

Cognitive Dissonance's picture

So your only measure of males and females is intelligence? LOL! Did you know that knuckle dragging is tough on the knuckles?

I never once used the term intelligence nor did I infer it in any way, shape or form? There are many different ways to see the world and intelligence is often the least important of them.