Growing up, my best friend’s father was a pilot for Ozark Airlines. He seemed like a pretty happy-go-lucky guy who loved flying and golfing when he wasn’t flying.

His demeanor changed markedly when Carl Icahn’s backed TWA bought Ozark. I didn’t understand it much then, but I heard terms like ‘corporate raider’ and ‘asset stripping’ at the time.

To my friend’s dad, Icahn was a true villain who borrowed money to enrich himself while ruining the companies he bought and sold. I didn’t have much of an opinion but knew better than to say as much when I had dinner at their house.

I didn’t pay much attention to Icahn after that, except when he got into a 30-minute fight on CNBC with another activist investor named Bill Ackman in 2012.

At the time, Ackman sold short stock in Herbalife, a company he claimed was a Ponzi scheme. Short selling is a way to profit from a stock’s decline.

An investor who wants to short a stock borrows it from an investor who owns it and pays them some interest for the privilege. The short seller then sells the borrowed stock to the market. The short seller then hopes to repurchase the stock at a lower price and return the shares investor that they borrowed them from.

A short seller buys low and sells high, but not in the usual order.

Herbalife was a multi-level marketing company selling shakes and vitamins through people encouraged to sign up their friends as salespeople and become distributors.

Ackman sold the stock short and then went on an extensive media campaign to lower the stock price. For reasons I don’t know, Icahn thought Ackman was off base and took the other side by aggressively buying the stock, hoping to hurt Ackman (since a higher price makes it more expensive to repurchase the stock).

The fight between Ackman and Icahn is fun to watch (you can see it here on YouTube), and the journalist in the exchange, Scott Wapner, ultimately wrote a book about the episode.

Herbalife is still in business, and as far as I know, both Ackman and Icahn claimed to make money on the stock even though they were on opposite sides.

In recent weeks, though, the table turned on Icahn because a prominent short seller, Hindenburg Research, published an article saying that Icahn’s company, Icahn Enterprises, was vastly overvalued and accused Icahn of running a ‘Ponzi-like economic structure.’

Some of Hindenburg’s other shorts have worked out, so Icahn Enterprises fell almost twenty percent two days in a row (yep, 20 percent on both days) and is still down by about half.

Icahn is now 87 years old, and the falling stock price cut his net worth by billions of dollars and forced him to scramble to preserve his empire.

I love Wall Street soap operas: I don’t have a dog in the hunt, it involves enormous personalities, and it’s unclear how it will turn out.

And, to me, it’s a reminder that short sellers are a vital part of the investing ecosystem.

When we first launched Acropolis, short seller Jim Chanos was taking down Enron. Chanos researched the company, realized it was a fraud and profited from his insights.

In addition to scoping out fraud, short sellers help our bottom line in two ways.

First, the funds we own – Vanguard, iShares, and the others – all loan stock to short sellers. We’re the ones collecting interest on the stocks that are held in the funds that we own.

Second, short sellers provide liquidity to the market at times when others may not. When a stock has an incredibly high valuation, short sellers sell it because they think it will fall, which might help contain the valuation.

If the stock falls, they’re out repurchasing it when others are trying to sell. They’re doing the opposite of the overall market, which provides liquidity.

Short sellers are often portrayed as villains beyond the dinner table at my friend’s house. Some people think it’s un-American to bet on stocks falling, and there is a little manipulation when someone builds a short position and then talks the stock down in public.

Investors do it on the long side, though, as does company management when they talk about how bright the future is for their company.

You can bet that I will keep watching what happens with Icahn Enterprises, including buying the book that will inevitably come out when the drama concludes, and there are clear winners and losers.