David Einhorn. REUTERS/Mike Segar
David Einhorn reminded investors, "Not every startup that is unprofitable is the next Amazon."
Greenlight Capital boss says crypto is too complicated and uncertain to be his.
Einhorn attributed some of the product shortages to underinvestment in stale businesses.
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David Einhorn, a hedge fund manager, cautioned that not all startups that lose money will become the next Amazon. He also complained that too few investors are looking at company accounts and predicted stubborn inflation in this RealVision interview.
Greenlight Capital boss, who also lamented the trend of people investing on market sentiment rather than fundamentals, said that cryptocurrencies were too complicated and uncertain to trade.
These are Einhorn's top 10 quotes from the interview. They have been lightly edited and condensed to make them more concise.
1. Amazon is the poster child of the bubble debate. Amazon was an unprofitable company with no margin prospects, but it eventually became a profitable business. As a result, there are many companies that are getting the benefit of doubt."
2. "America Online wasn't the dominant company it used to be. It is possible that there are companies that might be equally dominant or potentially dominant today, and that these companies might become America Online-like in 20 years.
3. "People have given up on critical accounting analysis. It is not something anyone is interested in. Companies with ethics are able to accurately account for their assets. Companies that do not have ethics aren't doing their accounting correctly. "There is nothing that can limit that."
4. "The current discussion isn't necessarily about the viability or sustainability of a business. Financial analysis is not something that many people do. It's easy to say, "Hey, people will buy the stock and they'll hold on for dear Life."
5. "Companies can release stupendous news, and have very little share-price reaction. The stocks aren't hated, but there isn't anyone listening. There is no one on the call, nobody doing analysis and nobody recommending the stock. The stock is not available for purchase.
6. "I am not part of the temporary-inflation crowd. All the money is being allocated by the private sector to fast-growing software companies that are eating the world. It isn't allocating money for companies that make products and offer other services that people find less interesting, so there is a shortage of these things right now.
7. People have not invested enough to create shortages in the economy. Copper, coal, natural gas and oil are all in short supply. It's the result of the market just refusing to put a reasonable cost of equity on firms that are a little bit more boring than the software-as-a-service companies. They are truly starving."
8. "There are so many things happening right now, I'm just putting it in the 'too difficult' bucket. Crypto is difficult for the moment, at least for me. It isn't regulated. It is unlimited. It has real appeal. It is a sign of the society's deterioration. It's either a huge waste of time or a great opportunity.
9. Some people believe that this is the right place to be, so these are the things you need. They will rise in value and you should have them. It's hard for me to understand why these are good investments. Because they own things that should be owned now, those people have done better than me.
10. 10. If that happens, I think that I will do well.
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