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When an investor goes long on an investment, it means that he or she is buying a stock with the belief that its trading price will rise in the future. Conversely, when an investor goes short, he or she is anticipating a decrease in share price.
Muddy Waters founder Carson Block is betting against commodities supplier Olam International Ltd (16 percent owned by Temasek Holdings) because it believes the firm is at risk of insolvency and has been too aggressive in booking future so-called biological gains. Latter allows it to record future gains from plantations and dairy farms i.e. book earnings not yet realized. Like what Enron did with its gas futures, this accounting practice and debt exposure can turn ugly in a hurry.
- http://singaporedesk.blogspot.sg/2012/12/shorting-our-future.html
Muddy Waters founder Carson Block is betting against commodities supplier Olam International Ltd (16 percent owned by Temasek Holdings) because it believes the firm is at risk of insolvency and has been too aggressive in booking future so-called biological gains. Latter allows it to record future gains from plantations and dairy farms i.e. book earnings not yet realized. Like what Enron did with its gas futures, this accounting practice and debt exposure can turn ugly in a hurry.
- http://singaporedesk.blogspot.sg/2012/12/shorting-our-future.html
