Hedge fund manager betting against Elon Musk gets box of short shorts

  • "I want to thank @elonmusk for the shorts. He is a man of his word!" David Einhorn said in a tweet Friday.
  • The short's short short-shorts joke with Tesla CEO Elon Musk began after Einhorn's hedge fund said in a letter he was "happy that his Model S lease ended."
  • Musk seized the opportunity on Twitter, retorting that he would send Einhorn "a box of short shorts to comfort him through this difficult time."

Greenlight Capital president David Einhorn tweeted Friday he got the pairs of short shorts that fellow billionaire Elon Musk promised him last week.

"I want to thank @elonmusk for the shorts. He is a man of his word!" Einhorn said in a tweet.

Einhorn added a tongue-in-cheek comment that the shorts "did come with some manufacturing defects," he said.

Musk did not confirm on Twitter that it was him who sent the shorts.

UPDATE: CNBC learned that apparel maker Chubbies were the ones who sent the shorts to Einhorn. The San Francisco-based online clothing brand offers a host of loudly-colored short designs, with most keeping to a very short 5.5-inch inseam.

Kyle Hency, one of the founders of Chubbies, told CNBC that Musk did not ask them to send the shorts, but they would continue to send them to his short-selling foes if the Tesla CEO wants.

Musk responded to the revelation that it was Chubbies with a laughing face emoji, saying, "awesome."

The briefs battle royale began after Einhorn's hedge fund said in a letter he was "happy that his Model S lease ended" and was replacing the car because of problems with the technology.

David Einhorn, president of Greenlight Capital
Andrew Harrer | Bloomberg | Getty Images
David Einhorn, president of Greenlight Capital

Tesla CEO Elon Musk seized the opportunity on Twitter, retorting that he would send Einhorn "a box of short shorts to comfort him through this difficult time."

"Tragic," Musk said in a tweet.

In the letter, Einhorn questioned Tesla investors, saying shareholders seemed to be backing the long-term growth of the company while Tesla appears to be focusing on "very short-term goals." Musk has been active on Twitter this year, fighting back against investors betting against his stock and other detractors, often with controversial comments.

Einhorn holds a short position on Tesla shares through his hedge fund but it has cost him heavily this year: Greenlight's fund dropped 18.3 percent in the first half of this year, with Tesla being the second-largest contributor to those losses in the most recent quarter.

Einhorn revealed the losses to his investors in Greenlight's letter while questioning Tesla investors, saying shareholders seemed to be backing the long-term growth of the company while Tesla appears to be focusing on "very short-term goals."

"We wonder whether surge production techniques to support self-congratulatory tweets are economically efficient ways of ramping production, or whether customers will be happy with the quality of a car rush through production to prove a point to short sellers," the letter said.

"The most striking feature of the quarter is that Elon Musk appears erratic and desperate," Einhorn's letter added.