Bearish pros leaning bullish?

Everyone knows the story of David Einhorn and his bearish bets on Lehman. He won't tell anyone if he covered, or if he is still short. But he did tell this to the FT:

David Einhorn, the hedge fund manager whose Greenlight Capital invests about $6bn, is eyeing investments in distressed debt but is waiting for prices to fall further.

“We’re not there yet,” Mr Einhorn said in a video interview with the Financial Times. “We have not yet begun purchasing distressed debt.”
http://www.ft.com/cms/s/0/44241740-5c0f-11dd-9e99-000077b07658.html

Last week it was John Paulson, who personally made $3.7 billion last year after he bet that mortgage bonds would blow up. he's looking to start a new fund to invest in banks.

John Paulson, who recorded what was thought to be the single biggest profit in the history of the hedge fund industry last year by betting on a financial collapse, is planning a new fund to provide capital to cash-strapped banks.

Mr Paulson’s New York-based Paulson & Co plans to open a new hedge fund by the end of the year to buy into financial institutions raising cash, although the plans have not yet been finalised. Investors said they expected to see documentation for the new fund next month, assuming it went ahead.

The move suggests Mr Paulson is preparing to call the bottom of the market for financials, a shift likely to be closely watched by other investors. Mr Paulson was the flag-carrier last year for a group of hedge funds that made enormous profits – estimated by investors at more than $12bn for Paulson’s funds – by shorting, or betting against, subprime mortgages.
http://www.ft.com/cms/s/0/488558bc-58f9-11dd-a093-000077b07658.html

You can get bearish by the headlines, or you can use the headlines as an opportunity.

These guys see an opportunity, and they've been the most vocal of the bears.

But Wall Street wants you to believe that the rally in the financials was just a "short squeeze."

It makes sense of course. Wall Street missed the entire collapse, why wouldn't they miss the entire recovery?