• Knave Dave
    05/23/2016 - 18:16
    This past Thursday marked the one-year anniversary of the US stock market’s death when stocks saw their last high. Market bulls have spent a year looking like the walking dead. They’ve...

What Happens When A Hedge Fund Hotel Explodes

Tyler Durden's picture




 

Sometimes, when one desperately chases alpha at any cost, all one needs to see is a somewhat credible asset manager, in this case Bill Ackman's Pershing Square, invest a massive amount of cash in a given company, to decide to invest alongside. In this case the company is JCPenney, and the amount in question invested by Ackman being $1.3 billion (at last check his third biggest positions after GGP and CP). Usually this strategy, elsewhere known as herding, 13F chasing, or alphacloning, works, until it doesn't. In the case of JCPenney it just didn't, after the company just blew up in real time dropping a tape bomb, missing on the top and the bottom, cutting the forecast, and for good measure also eliminating the dividend. End result: Ackman just lost nearly $200 million after the stock imploded by nearly 15% after hours, and all those who blindly piggybacked along without doing their homework (such as Whtiney Tilson whose 4th largest cash position is JCP), went for the ride.

Full list of JCP holders below.

 

Is it finally safe to say that the artificially propped up (no mortgage payments for ever... or until a point?) consumer discretionary tide is now over? And how long before we shift from retailers to those selling other iconic fads which now have a 6-9 month product cadence and are starting to self-cannibalize? Because, shockingly, it appears that unlike the Fed, US consumers just can't print money...

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Tue, 05/15/2012 - 16:45 | 2428878 YesWeKahn
YesWeKahn's picture

Nice crash, it is about time.

Tue, 05/15/2012 - 16:49 | 2428911 Rakshas
Rakshas's picture

today's theme for the ol' portfoolio:

 

http://www.youtube.com/watch?v=PHFveRxXfM4

Tue, 05/15/2012 - 17:03 | 2428972 sunaJ
sunaJ's picture

I think I have solved this whole European crisis thingy.

Check it:

First, the Greek PM, appearing to finally take charge of feeding his people, starts a nationwide baking campaign.  Stocks go up as fear goes down.  When Draghi comes looking for his money, Greek PM looks at him surprised and says, "Oh, I thought you say you want 400 Billion CHURRRRROS!"  This way, Greeks can feed themselves, "print" their own money, Germans can get angry (but only temporarily, for who does not love a good churro!) and we can reflate Greece's economy with an exchange rate of 1:1 EUR/CHU (which is just about right, anyway!). 

Whaddya think?

Tue, 05/15/2012 - 17:10 | 2429003 Rynak
Rynak's picture

I think i want you to post more often :-)

Tue, 05/15/2012 - 17:34 | 2429071 Au_Ag_CuPbCu
Au_Ag_CuPbCu's picture

It's not 400 Billion CHURRRRROS...it's 400 Billion Gyros. A Gyro for a Euro...makes perfect sense and gets you to that much vaunted 1:1 EUR/GYR....:)

Tue, 05/15/2012 - 17:39 | 2429092 Marginal Call
Marginal Call's picture

Considering a Churro retails around a $1-1.50 and a Gyro goes for $6-10 depending on filling, I think the Churro is a closer value-the gyro would be too strong a currency for the.   Under this plan  the Greeks would need to import a high volume of Mexican labor to produce authentic churros, because a bad churro is worthless.

 

Italy's situation will be more stable when they switch to the Canoli plan, because only Italians can make a good canoli.

Tue, 05/15/2012 - 17:45 | 2429127 strangeglove
strangeglove's picture

If weuse Soylent Green in the Gyro we can get that price down doncha think?

Wed, 05/16/2012 - 08:46 | 2430992 mendolover
mendolover's picture

Only on ZH!

Tue, 05/15/2012 - 19:46 | 2429563 BidnessMan
BidnessMan's picture

Yeah!  Gyros make much more sense.  Greek restaurants all around in Greece, right?  Get all those gyro meat round cooking thingys spinning around, slice off some gyro, and done.  And the Greeks could shave the gyros in smaller than regular slices, and debase the gyros just like the Roman emperors used to shave coins.  One or two less slices in the gyro but keep the german tourist price the same (easy to spot the German tourists - the people wearing socks with sandals). Who would notice?  A sharp knife, a careful eye - it could work!  Those 400 billion gyros could be paid off with debased gyros no problem.

Tue, 05/15/2012 - 17:49 | 2429134 bankrun
bankrun's picture

But can you eat it?

Tue, 05/15/2012 - 18:05 | 2429180 a growing concern
a growing concern's picture

I'm sad I can only give you one uptick.  And I'm strangely craving some sort of warm, cinammon-sugary goodness... if only there was an easily transportable food item that fit that description...

Tue, 05/15/2012 - 17:02 | 2428977 whatsinaname
whatsinaname's picture

Could be the go it alone strategy that JCP is taking ? No coupons.. no sales...

Backfiring ?

 

Tue, 05/15/2012 - 17:37 | 2429086 greyghost
greyghost's picture

well well well, who would have thunk that a company that went out of it's way to piss off 98% of their customer base would end up here? who would have thunk that a board of directors who hired an ex apple executive, who knows nothing about running a clothing store, would end up here? who would have thunk that hiring a spokesperson of the lesbian kind would drive the customers away? who would have thunk that a company that runs an ad with screaming women, even driving women away from the tv, would end up here? who would have thunk that after a poll, 67% of those polled didn't know what the company was doing with their ads, would end up here? who would have thunk that a company so hell bent on social engineering would litterly drive their customers into the waiting arms of the competition, of which there are many? well, i did and have bought my puts on these clowns running this company, sadly maybe even bankruptcy. can't wait for the action tomorrow. really tho, saddens me to see how some clown with an agenda can destroy so many jobs and peoples lives. ron johnson doesn't care he already has his!

Tue, 05/15/2012 - 17:44 | 2429111 Bizaro World
Bizaro World's picture

Ron Johnson!?  He was great in Miami Vice.....Oh, oh oh, you wrote Ron, not Don.....actually Don probably knows more about clothing stores

Tue, 05/15/2012 - 17:46 | 2429130 greyghost
greyghost's picture

damn...i needed that!!!!!! your right don johnson could have done alot better!!!!! thanks for laughs

Tue, 06/19/2012 - 11:00 | 2539443 Blue Horshoe Lo...
Blue Horshoe Loves Annacott Steel's picture

They should hire Philip Michael Thomas (Tubbs) as the replacement CEO. He & Don wore cool clothes. Or maybe Edward James Olmos (Lt. Castillio)? Get Jan Hammer to do the music for the commercials...

Oops.  It's "Ron" Johnson.

Tue, 05/15/2012 - 18:53 | 2429378 Larry Dallas
Larry Dallas's picture

Absolutely love this comment.

Besides the lesbian spokes model (who besides lesbians want look, dress and attract members of their own sex,; a big taboo for the earning group of young professional woman who want a man), now what makes JCP any different than Marshalls or TJ Maxx. Other than the fact that Marshalls has lots of brands and not just JCP's proprietary shitty brands (like Christie Brinkley's bomb "Sag Harbor", or" St. John's Bay")?  Do people wear that shit?

When you think of JCP, everyone now thinks "lesbian wear". Its true. Look on Twitter.

If you want to dress like a Latina Fashionista, you could buy Sofia Vergara's crap at Kmart (Mexican market targetted correctly).

My point: Look at other big boxes like Best Buy and others where the same thing is happening. Digital shopping has hit the inflection point and is moving so fast that retailers and shopping center owners are not going to be able to react fast enough. Continuing to deny the trend and saying we heard it all before about online shopping is just putting your head in the sand.

And I'm sure Ellen was a discernable "blip" to their balance sheet.

Tue, 05/15/2012 - 20:33 | 2429698 azzhatter
azzhatter's picture

You mean that Ellen chick is a lesbian? Jesus what is this world coming to

Tue, 05/15/2012 - 20:33 | 2429700 HungrySeagull
HungrySeagull's picture

Newegg rules. No taxes either.

It is literally cheaper to whistle up Brownie to deliver to your door than to DRIVE down to Best Buy or some shit place... to get a item.

Save the gas and hassles. Click order and wait a day.

Tue, 05/15/2012 - 21:01 | 2429770 dolly madison
dolly madison's picture

Wow Larry, you know much more about women's fashion than I do.  JC Penneys is actually one of the few stores I shop at, but I buy so little in recent years that I'm probably no help for them.

They sell many home goods too, but with less households forming and with people being worse off financially, I suspect that part of their business has really dropped off.

Tue, 05/15/2012 - 22:16 | 2430014 FlyoverCountryS...
FlyoverCountrySchmuck's picture

Looks like the Million Moms Boycott of JCPenney is having an effect, though our largely-gay Mainstream Media will NEVER admit it.

Gays may make up 50% of the Media, but they are only 2-3% of the General Population. What MORON thought hiring Ellen Degenerate as the spokesman for a retail chain targeting families and children was a good idea? The media all praised and trumpeted Ron Johnson's "BRAVE!" choice of spokesperson, but I guess the CUSTOMERS didn't care for it, much.

 

And yeah, I know about the price changes, and the "No Sales" idea, but REALLY???

Tue, 05/15/2012 - 17:36 | 2429083 jus_lite_reading
jus_lite_reading's picture

LOL@imbecile hedgefunders... I discussed JPC a few weeks ago and that the company is a dead man walking. Little by little my chosen ones come home...

Now, I ask again: who the hell "invests" in a brokeback mountain company? YOU little shits GET what you deserve!!

You ain't seen nuttin; yet!!

Tue, 05/15/2012 - 16:45 | 2428881 schoolsout
schoolsout's picture

Is that QE I smell in the air?

Tue, 05/15/2012 - 16:49 | 2428913 mayhem_korner
mayhem_korner's picture

 

 

Uncle Warren just bought 10 million shares of Govt Motors.  So QE must not be far off.

Tue, 05/15/2012 - 17:42 | 2429106 AldousHuxley
AldousHuxley's picture

he tends buy trying install confidence into markets, but market collapses anyway....and then he is bailed out by QE.

Tue, 05/15/2012 - 18:26 | 2429264 SeattleBruce
SeattleBruce's picture

Uncle Warren really is in cozy with TPTB, isn't he? (but, but, he's a kindly old gentleman from Nebraska...)

Tue, 05/15/2012 - 19:11 | 2429454 prole
prole's picture

A little bird told me that Ford and Trabant (GM) are, against all logic, starting to make good cars and may beat the Japanese companies in the upcoming high-mileage car scene,  getting introduced into the US market. YMMV

Tue, 05/15/2012 - 22:21 | 2430035 Tijuana Donkey Show
Tijuana Donkey Show's picture

Drop Gm, and that statement might be correct.

Tue, 05/15/2012 - 16:55 | 2428922 CPL
CPL's picture

And hyperinflation to be met with stagflation.

 

More pain coming for those still holding paper.   Pardon...frog being boiled slowly...people have just started to notice food prices...wait until there is no mistaking what happened at the super market.

 

Plant a garden is my suggestion.

Tue, 05/15/2012 - 16:56 | 2428947 HoofHearted
HoofHearted's picture

The people here at ZH are all terroristic, garden-planting, chicken-keeping, gun-toting, PM-hoarding, libertarians who believe in that archaic and foolish document known as the Constitution.

Hi, I'm HoofHearted, and my government considers me a terrorist.

I'm also short the financials, so I'm the worst kind of bastard out there, according to Uncle Sugar. Yes, I know QE365 and bailouts will probably burn me, but it is only fiat. And I hope to be smart enough to get out before it all goes wrong for me. We'll see...

Tue, 05/15/2012 - 17:02 | 2428968 tocointhephrase
tocointhephrase's picture

.

Tue, 05/15/2012 - 17:19 | 2429026 Piranha
Piranha's picture

:)

Tue, 05/15/2012 - 18:05 | 2429183 CPL
CPL's picture

I concur wholeheartedly.

Tue, 05/15/2012 - 18:12 | 2429195 blunderdog
blunderdog's picture

Fuck that.

Libertarians are just anarchists who lack balls.  They expect the big bad gummit they hate so much to help protect "their" money from the rabble.

They do so love to plot and scheme, but you can't get the better end of a deal with the devil.

Tue, 05/15/2012 - 19:13 | 2429458 malikai
malikai's picture

No. Libertarians are anarchists who have grown up.

Tue, 05/15/2012 - 19:36 | 2429536 blunderdog
blunderdog's picture

I used to call myself a libertarian.  Then I spent a few years working with financiers. 

They're wannabe "government."

Good luck with the scheming, though.  I suspect you'll end up scalped like everyone else.

Tue, 05/15/2012 - 19:45 | 2429567 malikai
malikai's picture

They'll have to find me first.

Tue, 05/15/2012 - 19:22 | 2429500 ClassicalLib17
ClassicalLib17's picture

Hello,  I'm one of the rabble who just happens to be libertarian.

Tue, 05/15/2012 - 18:28 | 2429282 SeattleBruce
SeattleBruce's picture

"so I'm the worst kind of bastard out there, according to Uncle Sugar."

Funny.

Tue, 05/15/2012 - 19:32 | 2429521 BidnessMan
BidnessMan's picture

 

"The people here at ZH are all terroristic, garden-planting, chicken-keeping, gun-toting, PM-hoarding, libertarians who believe in that archaic and foolish document known as the Constitution....."

Not that there is anything wrong with that ....

Tue, 05/15/2012 - 22:07 | 2429991 Nobody For President
Nobody For President's picture

I DO NOT have any fucking chickens!

Tue, 06/19/2012 - 10:51 | 2539414 Blue Horshoe Lo...
Blue Horshoe Loves Annacott Steel's picture

Throw in that U believe "9-11 was an inside job" & the DHS is watching U like Rockwell said.

Tue, 05/15/2012 - 16:46 | 2428882 mayhem_korner
mayhem_korner's picture

 

 

#Winning.

Tue, 05/15/2012 - 16:54 | 2428938 JP McManus
JP McManus's picture

Bingo, I'm here to collect.

Tue, 05/15/2012 - 16:48 | 2428896 101 years and c...
101 years and counting's picture

but, what about the short squeeze cnbc promised?  absolutely pathetic.  but, hilarious to me:)

http://www.cnbc.com/id/47432219?__source=yahoo%7Cheadline%7Cquote%7Ctext%7C&par=yahoo

Tue, 05/15/2012 - 18:13 | 2429203 Osmium
Osmium's picture

I can't believe that link still works.  You would think they would pull that bullshit story following the after hours dump.

Tue, 05/15/2012 - 16:49 | 2428899 Dr. Engali
Dr. Engali's picture

So... The economy is on sound footing, no?

Tue, 05/15/2012 - 16:49 | 2428903 duo
duo's picture

Unfortunately for JCP, their customer base, the US middle class, is doomed.  Nordstrom on the top, WMT on the bottom, and Amazon to serve the niche markets.

Tue, 05/15/2012 - 16:51 | 2428904 Christoph830
Christoph830's picture

Target, JCPenney....what's next Bill?  Please let us know so we can take the other side.

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