David Einhorn says we have reached the 'Fartcoin' stage of the market cycle

cnbc.com:

Greenlight Capital's David Einhorn thinks speculative behavior in the current bull market has ascended to a level beyond common sense.

«We have reached the 'Fartcoin' stage of the market cycle,» Einhorn wrote in an investor letter obtained by CNBC. «Other than trading and speculation, it serves no other obvious purpose and fulfills no need that is not served elsewhere.»

A crypto token called «fartcoin» exploded in popularity as the re-election of Donald Trump unleashed a storm of animal spirits on Main Street. The meme coin is now edging towards a $2 billion market value, surpassing many U.S.-listed companies.

More meme coins have emerged since the inception of fartcoin. President Donald Trump launched $TRUMP, a meme coin built on the Solana platform. Its market cap over the weekend climbed past $14 billion. The coin at one point was down more than 20% over the past 24 hours, but it has since cut its losses to around 3%. Trump's wife Melania also unveiled a coin.

«Nothing stops the launch of many more tradable coins,» Einhorn said. «Perhaps we are leaving the Fartcoin stage of the market and entering the Trump (and Melania) memecoin stage. It's anyone's guess as to what will happen next, but it feels like it's going to be wild.»

Einhorn's letter comes as investors drive equities higher, buoyed by expectations of lower taxes and deregulation from the second Trump administration. On Tuesday, the day after the inauguration, the Dow Jones Industrial Average rallied more than 400 points. The S&P 500 and Nasdaq Composite climbed 0.8% and 0.7%, respectively.

Greenlight took advantage of the craziness around crypto during the fourth quarter by betting against some popular ETFs linked indirectly to bitcoin.

The two funds the