Near-Record Trulia Shorts Crushed After Zillow Acquires Incomeless Company For $3.5 Billion

Tyler Durden's picture

What a difference a weekend makes... After offering $2 billion for Trulia last week (and seeing its share soar), Zillow has decided that $3.5 billion worth of its bubblicious paper money-stock is the right price for its real estate marketing and income-less competitor Zillow. Of course, on the back of near-record short interest the stock has exploded higher once again this morning and is now up over 60% from before last week's offer. We suspect the word 'synergy' will be used heavily (and not the word 'layoff') but in the interests of helping our fellow man, we present the combined firm's income statement...

They are paying this...


For this:


... and because of this (near record short interest)


This happened...


Sorry First Western Capital Management, but it is your fault you didn't realize the market was permanently broken some time in 2009...

Remember what we have said since 2012: the only strategy that actually works with unprecedented consistency in this broken, centrally-planned market is to go long the most shorted names. Today: another case in point.

Meanwhile, while shorts are the biggest losers, here are the biggest winners. Congratulations Stevie Cohen's Point72 who added to his position, as well as Tiger Global and momo expert JAT whose 4.6% and 2.2% stakes in TRLA, respectively, are both new positions as of the latest quarter.

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jubber's picture

short at will after the pop?

GetZeeGold's picture



Short the bubble before it pops......what could possibly go wrong?

Occident Mortal's picture

Nice to see Steve Cohen is no longer relying on...


Manthong's picture

Bernie Madoff is shaking his head in amazement..

Pool Shark's picture



It's the new math:

0 + 0 = "To Infinity, and Beyond!" 

NoDebt's picture

"short at will after the pop?"

Have you not been paying attention?  DO NOT SHORT ANYTHING!

It may look like a free lunch, but just wait until Google or Facebook steps in a few weeks from now and buys the whole shootin' match for twice this ridiculous price.

Bangin7GramRocks's picture

Efficient markets doing what they do........

yogibear's picture

Brings back memories of the DOT COM days. The Federal Reserve has succeeded
in bubblizing almost all assets. It's created a financial fantasyland.

RiskyBidness's picture

I guess alot of folks BTFD!!  HaHa

buzzsaw99's picture

the fed's gonna tighten any day now. bwa ah ah

yogibear's picture

"the fed's gonna tighten any day now"

LOL, Like with it's experiment called Japan. It's been going on for years. When Japan blows the Federal Reserve will see it's future, only a  much larger implosion.

GetZeeGold's picture



the fed's gonna tighten any day now. bwa ah ah


Double dog dare'm.

Whoa Dammit's picture

I have no income either, and I am willing to sell myself for a mere $3 billion.

d edwards's picture

EEEWWW! Crushed shorts sounds PAINFUL. :-D

Vendetta's picture

But in this 'market' you wear your shorts backwards....

toros's picture


toros's picture

correction $3.5M/employee

Screwtape III's picture

That's before the layoffs...

SickDollar's picture

is it too late to join the party and start using the stock market  as a full time job?????

NoDebt's picture

No.  There has never been a better time to buy stocks.

SamuelMaverick's picture

OK NoDebt, now that is some funny shit !!!



ceilidh_trail's picture

@sick- Nope. You too could be like "lawsofeconomic" and make $9500/week working at home on your computer. But, you'd only have to work 15 minutes/week putting in a buy order or two and then hit the pool as trading is so yesterday...

Mrs. Cog's picture

On a separate but related note, Zillow was a great tool to help locate the right rural property with search criteria for well water, independent septic systems, wood stoves and all the creature comforts that can be self sustained away from urban populations. Trulia had better photos of many of the properties we scanned through. I recommend taking advantage of these free resources before their virtual front doors are shuttered too.

Notsobadwlad's picture

Yup, the NSA (or whatever is behind them) is very good at databases.

Hobo Sapien's picture

As a former real estate photographer whose employer was bought in 2007 and subsequently destroyed, (2 weeks before xmas we were informed that we had been overpaid somehow and the difference they calculated would be subtracted from the next check - 4 months later both companies were gone, nobody got their last paycheck), I approve of your post.

And +1000 for your avatar; probably not one in a hundred people here know what it means. =)

dvfco's picture

The Squatting Man! Quite a symbol, no?

Hobo Sapien's picture

Yeah, seems like he was trending world-wide around 10,000 BC. Roland Emmerich could have made a much more interesting film with that title.

Notsobadwlad's picture

No conspiracy to defraud here .... "move along, move along".

Kina's picture

Smart money never learns huh

CaptOveur's picture

Joey, you ever seen a Trulia short naked? Sorry, down here in muppet hell all you can do is laugh. 

pragmatic hobo's picture

i call the top in housing market.

homiegot's picture

You are going to be famous.

Kreditanstalt's picture

Endgame: what happens when absolutely everyone's "business model" is predicated on selling advertising?   And no one atually PRODUCES anything anymore...?

yogibear's picture

The goal is to go from producing goods to producing debt.

Production of infinite debt is the goal of the central banks.

Ban KKiller's picture

Zillow and Trulia will ultimately be owned by the banksters the same way the banksters own the title companies, get it? The forgery and fraud works better when you control all the facets of the crime scene. Oh, the fewer the owners the easier the fraud. See Mortgage Electronic Registration Systems, Inc and how they cheated your county out of millions in recording fees. 

Death, by law, to banksters and their criminally inept attorneys. 

Yes We Can. But Lets Not.'s picture

FWIW, sold my home in DC area 2 weeks ago, and first site to show/reflect he sale was Redfin. Sold it FSBO at cost of $90, saving $20+k. Had 2 contracts, sold for more than what I was asking. Guy down the street has his home listed free on zillow, but that does not get the property on the MLS.....

zipit's picture

All these takeovers of heavily shorted stocks smells like someone has figured out a way of either fleacing people and/or bailing themselves out and/or just making themselves some sort of windfall profit.

Kreditanstalt's picture

There must be an absolutely craven, DESPERATE, utterly grovelling need for paper dollar YIELD out there on the part of big funds, hedgies, insurers, and mutuals...if not why do they keep shorting stock in a market which is COMPLETELY manipulated?

I guess when you promised your clients payouts in the 6-8% range and there's next-to-no real "growth" anywhere, you do reckless things...again and again and again...

yogibear's picture

Companies losing money should all be IPOing right now. Plenty of people looking to give their money away.

pound the vix's picture

I wonder if Morgan Stanley advised on the deal???

novictim's picture

Both Zillow and Trulia benefited from the court ruling in an antitrust case that allowed them to gain access to and print MLS listings.  That was a big deal, right? They basically have the ability to provide everything a Real estate agent would provide minus the "great company".

So the potenial to charge fees for access is real.  THe only problem is that ANYONE can now do the same as Zillow is doing.  Buying Trulia in no way protects them.  And as Zillow tries to earn a fee then people will flock to the competitors.

Well, one other path to riches could be that, for a price, Zillow helps manipulate the displayed listings to direct people to buy certain listings .  In other words, they can engage in fraud as a business model.

Hey, who is going to stop them?  The DOJ?  The FCC?  Fraud encapsulates the entire system that we are living in today.  From GDP numbers to uneployment numbers to Gold prices, this is a house of cards and fraud is growing that house, card by card, day by day. 

Don't sneeze!

Boxed Merlot's picture

and fraud is growing that house...



You make some valid points.  I can remember laughing at the "values" on these sites to properties in my neighborhood and thankfully didn't "buy" their "estimates".  But how many have, do and will?  "Mark to market" indeed.  These are just more tools for their "shareholders" to ramp up their derivative portfolios even higher. 

They have taken the Homes of the US middle class and turned them into the ultimate device to manipulate monetary policy.  Who needs revenue when the true worth is an unbridled control of setting the “values” of their holdings at whatever they want?

While having competition in this field would be welcomed and sought, who would use it if the “standard” set by these truly TBTF entities benefits local tax bases with ever rising (inflated) tax receipts year after year?  Or better yet, the threat to lower / reduce those receipts if some independent minded jurist should ever think of exercising justice?




Arthur's picture

Hmm,  I am liking Zillow at the moment.  

Said my house value and rental is about 10% over what I think and I am renting out the house.  Kinda like retail pricing.

Would also say that Zillows assesment has become much more accurate over the last few years.  Which is what you would expect as they gather more data.



Boxed Merlot's picture

Zillows assessment has become much more accurate over the last few years.  Which is what you would expect as they gather more data...



What part of "past performance is no guarantee of future results" is not resonating?  If every property in my neighborhood could be had at the same particular moment in time any of these services claim, the overall values most assuredly would not even be close to what's being claimed.

These money changers have learned from their failure in their MERS foray to even go further upstream in order to gain access to and hypothecate beyond reason the traditional US middleclass' go to bedrock of security / faith / credit and simultaneously weaken / destroy the structure at it's very foundation.

Once the rule of law, i.e. uniform laws of bankruptcy, was circumvented, all bets were off and we’ve been off to the races.  Now, whose horse is going to come in “first”?



scraping_by's picture

One almost feels sorry for traditional investment firms using the analysis tools they learned in business schools on the current market. All the textbooks say a company with revenue less than expenses, big debt, no hard assets, and many competitors is a surefire short. While that may have been true in a market of many individual investors making independant decisions, it's completely out of touch with a market defined by the world's central banks printing to inflate to a big number goal.

Definitely Dot Com 2.0.


mastersnark's picture

1999 called, it wants to investing strategy back.

Apocalicious's picture

I'm old enough to know how little I know, but investing today seems to look something like this.


Disregard fundamental investing. Then pick from below.


1) This one is really simple - get long what the overlords are A) long themselves or B) explicitly supporting. B is slightly riskier. 


2) You can attempt to find pockets of value which others have not yet found. This is riskier still, and increasingly difficult. Lots of smart people doing this. The return on effort compared to A above is low.


3) You can short things that the overlords are not A) long themselves or B) willing to allow collapse. However, both carry the risk that some fool engaging in number 2 above may come in and wipe you out. There are certainly thousands if not millions of fools with more money than you, dumber thay may be. 


Other than the dollar, I struggle to find things the overlords actively want to kill. 


There are no "markets" anymore. 

gcjohns1971's picture

$3.5 Billion in return for NOTHING implies that the value of $3.5 Billion in real terms is ...NOTHING.