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A few weeks ago, legendary short seller David Einhorn revealed that he was short Chipotle.People freaked out and Chipotle shares plummeted.
Is there anything wrong with that?
Former Chipotle chairman Mats Lederhausen thinks so. He’s the man who helped shape the company leading up to its big IPO in 2006.
We spoke with Lederhausen, who’s now growing a new concept called Roti Mediterranean Grill, about what the thought about the happenings between Einhorn and Chipotle.
He didn’t have anything good to say about short sellers like Einhorn. In fact, he was pretty disturbed by how it all went down.
“I have very little respect for short sellers. I think it should be illegal,” Lederhausen tells us. “When people take short positions and go out and bad mouth companies, I think that’s poor behaviour that’s borderline — it’s unethical.”
Lederhausen is irked by the “very notion” of short selling.
“I’m inherently sceptical about someone taking a short position and saying why [a company] is a bad idea … I don’t see the social value of that kind of speculation,” he says. “Chipotle can’t say anything about their performance. There’s SEC rules that guide what they say and what they can’t say.”
“I’m a proud shareholder of Chipotle and all this noise will not affect my desire to remain a proud shareholder of Chipotle,” concludes Lederhausen.
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