Some reader comments about David Einhorn

We get a lot of good comments on here, and I appreciate how it is always constructive discussion of ideas.

I threw out the question of who is this Davod Einhorn.  Some interesting replies..

JMP:

Einhorn is one of the smartest guys on Wall Street — and not smart in a “rip off the little guy” sort of way.

Rather, what the story of Allied shows is that this is a guy who saw through the BS and recognized that a company that people were falling over themselves to praise was really built on smoke and mirrors, and so he bet heavily that the company would eventually go down. He reached this conclusion by studying the company’s financial information, and supported that conclusion with evidence.

More recently, he was also in the financial news today because he called for Microsoft CEO Steve Ballmer to step down. Einhorn has a bit of say in the matter, as the fund he runs is the second largest Microsoft shareholder.

The key to the “less than a million dollars” line is not that he started from nothing. He clearly started from a family with some means, but not ridiculous wealth. Rather, he was able to take that initial sum — whatever the exact figure — and turn it into over $6 billion. Any idiot (like Jeff Wilpon) could take billions from his father and turn it into millions. It takes real skill to turn a million dollars (or less) into several billion.

The really important thing to know about Einhorn is that he does not spend money on something if he doesn’t perceive value in the investment. If he’s spending $200 million of his own money on a stake in the Mets, he has a real belief that it will eventually be worth a hell of a lot more than that. It’s also pretty likely that his deal with the Mets includes a clause specifying that if the Wilpons decide to sell the remainder of the team (or if they’re forced to do so), that Einhorn would have the first shot at buying it. That would be very good news.

The baseball owner closest in temperament and skillset to Einhorn is Stuart Sternberg, owner of the Tampa Bay Rays. The Mets could do (and have done) a lot worse than having management like the Rays…

Patrick weighed in on my Jeff/David rivalry theory:

I don’t think it will matter. I think as I always did that this first stage of a sale is simply the first phase of the Wilpons soft landing. Bud Selig is orchestrating a soft landing and in return gets an ownership transition that he and the other owners will find pleasing to them.

Right now the Wilpons retain saved face, and then over the course of the next two to three years they will talk of being weary of the duties of owning a team, yada yada yada, and Einhorn will bring in additional investors. Perhaps he will be the majority owner, perhaps not. Either way Jeff Wilpon ends up with a courtesy luxury box and a remaining lifetime of what if.

I think you’re dead on about the saving face/Selig theory.  What are the odds of Bud Selig’s neighbor coincidentally buying the Mets?

I’m wondering if he’ll do a session with the bloggers..and if so what the heck I should ask him?  I’ll let the other guys ask the grown-up questions and probably ask about June 15, 1977 (Kingman trade) unless of course Greg Prince beats me to it.

I know I’ve become a higher-up in the War to Ditch The Black but I really don’t want to be a cartoon character on the calls…”so new owner guy can we get rid of black yet, huh?” is kind of lame.