#Tesla short-seller no longer ‘hostile’ to Elon Musk’s ‘bulls–t’

After slamming Elon Musk as a “liar” for years, short-seller Carson Block says he’s come to develop a “newfound understanding” of the Tesla CEO’s “bulls**t. 

In a colorful letter obtained by The Post — Block’s first missive to investors since starting Muddy Waters Capital six years ago — the hedge fund manager said he’s done with buying put options betting the electric-car maker’s shares will decline. Those bets went to “Heaven” after “the Fed loosened in response to COVID” last year, he said.

And while Block admits some continued disdain for Musk’s “pathological narcissism,” he concedes that he also misjudged the billionaire behind Tesla and rocket company SpaceX, including his ability to raise money from adoring fans and other investors.

“While I always admired that Elon demonstrated the viability of EVs with the Model S and has built rockets that really do innovate and work, I disdained his incessant bulls***. I felt it was an unnecessary stain on his legacy,” Carson explained of his failed short thesis. “But with what I think is newfound wisdom about the way the world needs to work, I’m less hostile.”

“Jedi Mastery is being able to set your audience’s acceptance level for the amount of bulls*** you want to deliver. Nobody embodies this better than Elon.”

Block says he still thinks Tesla’s $710 billion market cap is dangerously overvalued. But doesn’t think the sometimes questionable antics by Musk, whose tweeting has attracted regulatory scrutiny over the years, will cause the stock to decline.

“Might he fail?,” Block said of Musk. “Maybe. But look at the iterations of Elon’s image – from that of a humanity loving environmentalist to gladly letting Ted Cruz hang from his jock while flouting the law. The market cap, the luster, the elan of Elon, is still there.”

Over the years, Block has positioned himself as a gadfly who loved “f***ing with people.”

And he retained that tone in his wide-ranging and irreverent memo (he uses the f-word twice and the s-word nine times over six pages), aimed at raising money for a new fund, while also showing a new level of retrospection.

He acknowledges following the GameStop saga short-selling — the fund’s bread and butter — has come under tremendous scrutiny. After retail investors crushed hedge funds like Melvin Capital that were short meme stocks including GameStop, investors soured on investing with shorts. 

Muddy Waters’ latest venture: The Domino Fund ended up launching with around $30 million — less than the $70 million they initially had in commitments. 

Still, Block says there’s no end of short-selling opportunities and that a “torrent of charlatans” will continue to emerge and try to defraud investors.

What Block does highlight as his biggest concern is “the political dysfunction of America is the largest threat to the viability of the activist short-selling model.”

Despite the worries, he ends the letter on a confident note saying he is confident he’ll be able to “pull down the pants of the grifters in the markets” for the foreseeable future.