# How Porsche hacked the financial system and made a killing



## Rastan (9 January 2009)

I found this article on reddit and thought it was pretty interesting - about how Porsche did a short squeeze on the market. I am unsure of its accuracy, but assuming its true it was pretty darn smart. Enjoy!

http://radian.org/notebook/porsche


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## nomore4s (9 January 2009)

Pretty amazing if it's true.

Someone at Porsche will be getting a good bonus.
Pretty stupid by the shorting companies though, what ever happened to managing your risk.


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## Naked shorts (9 January 2009)

yeah its true

http://www.bankr.co.uk/2008/10/porsche-crushes-hedge-funds-takes-5-billion-profit-in-3-days/



> We buy their cars, helping them to annual revenues of £5.2 billion, we give them the cache of the uber trendy and make them mystical in the eyes of the civilian populace, and this is how they treat us. You should be aware of Porsche’s recent moves to squeeze the short sellers on Volkswagen’s shares which came to light this week.
> 
> VW Shares surge from â‚¬420 to â‚¬1005 as traders scrambled to cover their positions
> 
> ...


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## Knobby22 (9 January 2009)

nomore4s said:


> Pretty amazing if it's true.
> 
> Someone at Porsche will be getting a good bonus.
> Pretty stupid by the shorting companies though, what ever happened to managing your risk.




Great article Rastan.
Darvin accidentally did the same thing when he made his fortune.


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## MrBurns (9 January 2009)

Rastan said:


> I found this article on reddit and thought it was pretty interesting - about how Porsche did a short squeeze on the market. I am unsure of its accuracy, but assuming its true it was pretty darn smart. Enjoy!
> 
> http://radian.org/notebook/porsche




Great article , aren't there any disclosure laws over there ?
You couldnt buy that much of a company here without disclosing it to the exchange could you ?


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## maffu (9 January 2009)

MrBurns said:


> Great article , aren't there any disclosure laws over there ?
> You couldnt buy that much of a company here without disclosing it to the exchange could you ?




There are different disclosure laws in Europe then in the US/Uk/Australia (we use Common Law founded by the British)
The US/UK/Australian markets are structured in a way to give full disclosure to share markets as sharemarkets are the biggest source of investment funds.

French, German, Japanese (Use code law founded by the Romans so a different legal system) markets function quite differently as share markets are not as important in those countries and private and bank funding is more important then Equity. Disclosure to the public and shareholders is no where near as strict.


Here are some notes from my Uni subject on International Accounting:

·	In Credit/Insider countries, eg France (Govt) or Germany (Bank), there is no great market demand for audited and published financial reporting as directors are generally closely appointed by Banks or Govts who can easily obtain relevant information at any time.
·	 Annual accounting in these countries takes place so that a company’s taxable income can be calculated. In this situation it can be seen that taxation rules dominate accounting rules. 
·	There is less need for auditors, weaker legal protection of investors and more prudence and conservatism  in Creditor/Outsider countries than in equity/insider countries.

·	In Equity/Outsider countries, eg USA and Aust, accounting performs a market function, therefore accounting rules are separate from tax rules. 
·	True and Fair disclosure is necessary because not all shareholders have a direct link to the company’s directors and financial reporting  information is the basis of individual shareholders decision making.
·	There is more need for auditorsÃ  greater transparency of financial information and a stronger legal protection for investors in equity/outsider countries.


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## MrBurns (9 January 2009)

maffu said:


> There are different disclosure laws in Europe then in the US/Uk/Australia (we use Common Law founded by the British)
> The US/UK/Australian markets are structured in a way to give full disclosure to share markets as sharemarkets are the biggest source of investment funds.
> 
> French, German, Japanese (Use code law founded by the Romans so a different legal system) markets function quite differently as share markets are not as important in those countries and private and bank funding is more important then Equity. Disclosure to the public and shareholders is no where near as strict.
> ...




That's great maffu many thanks


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## So_Cynical (9 January 2009)

All very interesting...so im wondering why inst there Aussie outfits wanting 
to "borrow" shares from mum and dad (buy and hold) investor types?

Am i nuts to think this could be a very profitable endeavor?


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## Rastan (9 January 2009)

Knobby22 said:


> Great article Rastan.
> Darvin accidentally did the same thing when he made his fortune.




Cheers,

Yeh it took me by suprise - who is Darvin that you mentioned?


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## Knobby22 (9 January 2009)

Rastan said:


> Cheers,
> 
> Yeh it took me by suprise - who is Darvin that you mentioned?




Sorry Nicholas Darvis

http://searchwarp.com/swa24292.htm


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