Tuesday, September 29, 2015

The Shkreli Put

Martin Shkreli is a product of the Jim Cramer Mad Money scam machine. That right there raised a giant red flag for me. Shkreli created a hedge fund, MSMB Capital Management. He got into biotechs. Who knows how deep into it he actually got. I do not have dollar amounts. What I do have is an interesting theory. Keep in mind that this is pure speculation on my part. I have no evidence, it is only a theory. It is called the Shkreli Put.

What you do is you buy a small drug company, and you jack the price up on a single obscure drug. This creates a media frenzy, one that actually initiates a tipping point of public outrage. People see drug prices exploding across the board. They see biotech stocks in a massive bull market. It is quite clear to the masses what is going on here. Greedy companies jacking up prices to line the pockets of rich biotech shareholders. Its a pretty cut and dry thing. But why would he do it? Why jack up the price of a drug to such blatantly outrageous levels? It's simple really, so the theory goes. He did it because perhaps he is short biotech? And by short, I mean massively short, with leverage. We're talking John Paulson level of short. So short that perhaps he stood to make billions off a collapse of biotech stocks? Perhaps? Perhaps one day we will find out.


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