The Twitter Files, Bill Ackman edition

Most people on Wall Street know Pershing Square Capital CEO Bill Ackman as a daring shareholder activist, a hedge fund manager who once famously vowed to go to the ends of the earth to take down a foe. But after experiencing multi-billion dollar failures on that front — with Herbalife and Valeant — and rebuilding his reputation with a $2.6 billion short bet during the early days of Covid-19, Ackman gave up that form of activism. Last year the 56-year-old even relinquished his role as chief investment officer at Pershing Square to one of his younger partners.

Now, as his recent policy prescriptions surrounding the failure of Silicon Valley Bank suggest, Ackman is embarking on another chapter in his life — as a political activist on Twitter. In fact, Ackman’s such a fan of the social media site and its new owner that, as he recently disclosed on a little-noticed Twitter Spaces broadcast, he invested alongside Elon Musk in his leveraged buyout of Twitter. He thinks the social media site is “much better” under Musk’s ownership.

From Ackman’s perspective, sharing his views on what he calls “macro issues” is nothing new; he first did so in 2007, with his presentation on bond insurer MBIA, “Who’s Holding the Bag.” Ackman’s MBIA short made his reputation — and his first billion dollars. “I don’t view my job as just being a stock picker,” Ackman told Institutional Investor. “I view my job as finding great companies we can own but also being aware of what’s going on in the world.” He said that includes hedging “black swan and other kinds of risks” as well as trying to exert influence “when I think the country is going in the wrong direction or the central bank is making a mistake.”

What’s undeniably new is Twitter — and the constant bombardment of Ackman tweets on any number of politically charged issues, from the war in Ukraine to Kyle Rittenhouse and Sam Bankman-Fried to the presidential election — and the unfolding banking crisis. On Twitter, Ackman, now 56, can take his phone out of his pocket and comment at length, directly to the public, in real time — without having to answer questions from pesky journalists.

After the 2008 financial crisis, Ackman rarely spoke publicly on matters beyond his hedge fund’s positions. Covid changed that. Ever since he went on CNBC to warn the country that “hell is coming” while pleading with Trump to shut down the country in March of 2020, Ackman has been moving into the Twittersphere, often with controversial takes that have been met by long-term friends and fans with surprise — and occasional chagrin. Not all of his commentary can be termed a “macro” issue either.

Ackman’s most contentious take occurred last December when he tweeted in support of Bankman-Fried after the FTX founder was interviewed by Andrew Ross Sorkin at the New York Times Dealbook Summit, a few weeks after his crypto exchange went bankrupt. “Call me crazy, but I think @sbf is telling the truth,” Ackman tweeted — to a storm of blowback. Even Ackman’s longtime friend Whitney Tilson disagreed with Ackman. “I told him SBF in my view is Elizabeth Holmes times two,” Tilson said, referencing the convicted biotech fraudster. “Bill will listen, he will not hold a grudge against you, and sometimes, God bless him, he will change his mind.”

You can read the rest of my story at Institutional Investor here:

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