Prominent Tesla Short-Seller Issues Major MicroStrategy Warning

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As a seasoned investor with a knack for recognizing market trends and patterns, I find Mark Spiegel’s analogy between Michael Saylor and the Hunt Brothers intriguing, to say the least. The silver market fiasco of the 1980s serves as a stark reminder that when one entity controls such a significant portion of a commodity, it creates an unstable market situation.

Investment specialist Mark Spiegel, renowned for his significant bet against Tesla, has raised concerns with a pessimistic outlook regarding the rapidly growing business analytics company, MicroStrategy.

On a recent Thursday social media update, Spiegel shared his viewpoint that Michael Saylor, the captivating co-founder of MicroStrategy, resembles the Hunt Brothers in terms of their influence on the silver market.

I might one day find myself in a position where I need to sell all my Bitcoins, only to realize then that I was essentially the entire market.” (Spiegel’s warning)

In a notable attempt, Nelson Bunker Hunt, the eldest offspring of oil magnate H.L. Hunt, joined forces with his siblings William Herbert Hunt and Lamar Hunt in an endeavor to control the silver market.

Using funds from wealthy Saudi Arabian sheiks and other lenders, Hunt began purchasing vast amounts of silver. By January 1980, the Hunts had amassed a staggering 150 million ounces of this precious metal. At that time, the value of silver soared to $52 per troy ounce. Essentially, they held the lion’s share of the privately-owned silver market at that moment.

Nevertheless, as the price of gold plummeted, speculators began cashing out their silver profits. The banks assisting these speculators found themselves requiring repayment following President Jimmy Carter’s implementation of a credit crunch.

On “Black Thursday,” which took place on March 27, 1980, the cost of silver plummeted drastically. The Hunt conglomerate suffered losses amounting to approximately $2 billion in just one day.

After facing various lawsuits, the Hunt brothers ended up declaring bankruptcy in 1988.

According to U.Today’s report, MicroStrategy has declared its intention to secure a massive $42 billion loan for the purpose of further Bitcoin purchases.

In order to meet its lofty fundraising target, MicroStrategy plans to sell up to $21 billion worth of shares, borrowing a strategy from Tesla.

Many Bitcoiners view this as a bullish development, but there are also some concerns about MicroStrategy making broader corporate adoption less attractive due to its massive holdings. 

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2024-10-31 21:26