Prediction Not checkable as stated
China Will Become Uninvestable If Xi Retains His Current Advisors
“If he stays in power, which it looks like he's going to, and he's got the same people around him, the same advisors, I think China is going to ultimately become an uninvestable market.”
Prediction Not checkable as stated
Distressed Russian Assets Will Return 50x Rapidly Upon Any Regime Change
“Just a small amount of investment in those stocks, and some people can retire on it because you're going to make 50 times your money on any regime change in a very quick period of time, so.”
Prediction Not checkable as stated
Argentina Might Be the World's Best Performing Market in 2023
“Next year might be the best performing market in the world on the back of that election.”
Prediction Didn’t hold up
Citrone: US Core Inflation Has Peaked but Won't Fall Fast Enough
“I actually think inflation is rolling over. It's just going to take longer to come down to the acceptable levels, but it's rolling over. It's peaked in our view. The real risk on the headline is energy prices and maybe food prices. I mean, maybe headline can g…”
Insight
Investors Should Hold Winning Shorts Because the Best Drop 90%
“The other thing is, is shorts are working. It's tough, but you need to keep the position on. Let's say you start with a three percent short. It halves. It's only one and a half percent now. So Julian would always say, well, the best shorts go down 90%. They do…”
Prediction Partly held up
Turkey Is the World's Best Short; CDS Will Top 1,000 Bps
“We think maybe the best short in the world is Turkey right now. Turkey CDS has gone from about 400 over now to 800 over. We think it's going well over a thousand. The country is going to experience a traditional currency and credit crisis as we've seen in EM w…”
Disclosure
Discovery Capital Maintained a Short China Stance Since August 2021
“Well, we think the currency in China is a great short. So it's one of our larger positions. We're short than the CNH. We do have some individual equity shorts there. We've been short China since August last year”
Opinion
A West-China-Russia Cold War Will Crush Asset Prices and Returns
“I really think that we're in a process of moving to a massive cold war of the West against China and Russia. I think that's terrible for returns and asset prices, and it's really bad, obviously, for Chinese assets.”
Assertion Not checkable as stated
Lula Privately Signaled to Contacts He Intends to Govern as Market-Friendly
“It'll be Lula one, not Lula two in our view, and he wants to be the candidate of the market. He's mentioned that privately to people that we know.”
Prediction Held up
The Bank of Japan's Yield Curve Control Peg Cannot Hold
“In fact, I think one of the best opportunities in the world, quite frankly, is in Japan, where they have the YCC program, where they have tenure rates pegged to 25 basis points, zero to 25. There's no way that's going to hold in this environment.”
Prediction Held up
Citrone: Shorting Long-End Japanese Debt Offers 50 to 75 Basis Points
“That's one of the best fixed income shorts in the world today. He may not make a hundred basis points, but it's 50 or 75 basis points to be made in the long end on the short side there, 10 years beyond.”
Opinion
Tiger's Short Japan, Long US Stance Was a Historically Brilliant Trade
“Back then in the nineties, the big trade that Tiger had and where Julian made tons of money was a macro trade. He did it through individual stocks, but we were short Japan and long the US. And that was a massive macro trade. It was one of the most brilliant ma…”
Assertion Not checkable as stated
Soros Called Gordon Brown to Pitch Citrone's Eastern Europe Rescue Plan
“George said, what do you think is the big next problem? And I said, George, there's a big problem in Eastern Europe. And if Eastern Europe comes down, then Western European banks are going to go down, and then it's just going to cascade this crisis everywhere.…”
Insight
Effective Short Selling Requires Asymmetric Skew and Strict Sizing
“One is you got to be incredibly careful because there's unlimited loss in shorts. You don't want to ever have any of the shorts too large, but you also want to have shorts that the skew is so much in your favor. Like if you're long, you lose 10 or 15. If you'r…”
Prediction Not checkable as stated
Citrone: Macro conditions favor shorting individual stocks for a while
“You don't see as many people shorting individual stocks, but I think now is the time to be shorting individual stocks. It has been for the last few months, and I think that's going to continue for a while.”
Prediction Not checkable as stated
Reversing Globalization Will Trigger Lower Growth and Higher Inflation
“There's some tremendous opportunities going to come out of this, but it really is a problem for the world and a problem for this globalization, which was so prosperous for so many countries and so many people for so many years, I think is now unfortunately goi…”
Insight
Avoid or Short Any Tech Company Valued on Price-to-Sales or TAM
“Anytime a company's still being priced to sales or they're talking about the TAM, I want nothing to do with that company. Probably a short”
Prediction Not checkable as stated
Upcoming Recession Will Spare Services; Travel Sector Will Do Very Well
“It's going to be an interesting recession where it's not a service recession. Actually things like travel will do very well. Usually travel does terrible in a recession. I think it's going to do very well because there's so much pent up demand there.”
Prediction Didn’t hold up
Citrone: US Will Enter Mild Recession by Late 2022 or Early 2023
“I think it'll be a mild recession. I think we'll be there very quickly by the end of the year, early next year in the US.”
Prediction Not checkable as stated
Citrone: Tech Sector Will Face Severe Challenges and Yield Strong Shorts
“I think technology is going to be one of the areas in the next year is going to be very, very challenged. Probably a lot of good shorts are coming out of there.”
Disclosure
Discovery Capital is currently short the German DAX index
“We're currently short the DAX.”
Disclosure
Citrone Will Never Allow Discovery Capital to Return to $15B Peak AUM
“I'll never get back to that kind of size. It's just too large in these markets.”
Assertion Not checkable as stated
Citrone: Market liquidity is worse than it was 10 to 15 years ago
“And quite frankly, liquidity is worse today than it was 15 years ago, 10 years ago, even.”
Disclosure
Discovery Capital Credited Back Management Fees to Investors After Poor 2019
“The other thing we did in 19, we thought we had a really bad year. We gave back our fees to our investors. I basically said, look, I think we just did a lousy job. I feel terrible about that. I don't feel like I earned any of my fees. Anybody who stays, I'm go…”
