Investor Sentiment: Shorts Giving Up?

Echoing a theme I highlighted in the weekly look at investor sentiment, here is an article from MarketWatch on David Einhorn, head of hedge fund firm Greenlight Capital.  It seems as though Greenlight Capital closed a significant number of short positions in quarter 1 not so much because of fundamental reasons but because the market only goes up.  

In an April 29 letter to investors, Einhorn wrote that "we are in a particularly difficult environment for shorting stocks,”and that “much like Charlie Sheen, who seems to believe that all publicity is good publicity, recent market behavior suggests that we are in the part of the cycle where ‘all news is good news.’”

So once again I ask: "Why bet against the market when it only goes up?"  My answer: this is a prevailing attitude that is a sign of complacency, and while investors are expecting the market's rise to be a sure thing, my experience is that there is nothing ever certain about the markets.

Einhorn's letter to investors is below.
Green Light