Jim Chanos

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Oil Becoming ‘Mundane Return-on-Capital’ Business, Chanos Says
http://www.bloomberg.com/news/articles/ ... hanos-says


Episode 6 | Jim Chanos, Larry Altman
http://wallstreetweek.com/watch/?video= ... rry-altman

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Philadelphia pension fund pulls money from Jim Chanos' firm after April losses
http://www.pionline.com/article/2015060 ... ril-losses

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Jim Chanos Makes 16 New Buys in First Quarter
http://finance.yahoo.com/news/jim-chano ... 12692.html

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James Chanos: More Pain to Come in China

Most notable bear on Chinese market says story ‘has yet to play out’

Even after Thursday’s gains in China, investors are licking their wounds from a 28% plunge in shares since mid-June.

But the most notable bear on the Chinese market has a warning for bargain hunters: More pain is ahead.

“The story has yet to play out,” says James Chanos, the short seller who runs New York hedge fund Kynikos Associates. “As long as China adds credit faster than its growth, the real story is months and years ahead.”

Mr. Chanos and fellow China bears are increasingly in the spotlight, not only because of the potential profits they might claim but also because they are now in the cross hairs of the Chinese government. On Thursday, a report by the state-run Xinhua News Agency said Chinese police were investigating “malicious short selling.”

Short sellers generally sell borrowed shares on the belief they can buy them back at a much lower price, pocketing the difference. Critics of the practice say it can fuel a market decline.

Many would-be bears say they have been wary of shorting Chinese investments. Some say it has been challenging to establish sizable bearish positions in China. Others worried about a fight with the Chinese government or were concerned about taking a stance in a market that Chinese leaders have been trying to aid.

One hedge-fund manager says he managed to do some shorting but watched in frustration as hundreds of Chinese stocks were frozen from trading Wednesday, making it impossible to tally his trading results or exit bearish positions.

The Shanghai Composite gained nearly 6% on Thursday, arresting the sharp fall from earlier in the week.

Mr. Chanos has been betting on a downturn in China for around five years, a period when Chinese shares rose steadily along with many markets around the world. Those conditions made it difficult for Mr. Chanos, and his firm’s assets under management shrunk to around $3 billion, down from about $6 billion several years ago.

But Mr. Chanos, who famously first cast warnings about Enron Corp., maintains about 20% of his firm’s global funds in bearish Chinese positions, he says. Those positions are making money, he says, though he declined to elaborate.

Looking forward, Mr. Chanos argues that the inability of Chinese leaders to stem the tumble in recent weeks will sow doubts about the government.

“I have no idea where equity markets will trade, but the Shanghai market is not the best barometer” of the declining health of the country, he says. The Chinese economy “has been on a five-year glide path downward” that he expects will continue.

Investors have itched to profit from shorting China, where valuations of mainland-listed stocks had soared to dizzying heights as major stock benchmarks doubled within a year. Last month, famed bond investor Bill Gross declared the smaller Shenzhen market the potential “short of a lifetime,” in a tweet issued by his employer, Janus Capital Group Inc.

A number of funds have made money from bearish Chinese positions, including San Francisco-based Valiant Capital Partners, according to people familiar with the matter. Valiant was founded by Christopher Hansen, an alumnus of Julian Robertson’s Tiger Management Corp., who in 2013 lost out on a bid to buy the Sacramento Kings basketball team. A spokeswoman for the firm declined to comment.

But the winnings of most China bears aren’t nearly as great as the traders wish, sparking some gnashing of teeth. And some bearish traders have been nervous about a market that until recently had been furiously rallying. Mr. Gross has said he hasn’t placed bearish trades on China for his fund, despite his concerns.

Michael Hintze is among those who wishes he had made more during the recent tumble. Mr. Hintze, who runs $14 billion London-based hedge fund CQS LLP, anticipated an economic slowdown in China, partly due to an anticorruption effort that figured to slow high-end spending.

Mr. Hintze didn’t place big bets against Chinese stocks, though, opting for other wagers that he believed would profit on weakness in China. For example, he bought credit default swaps, a derivative that provides insurance against debt defaults, on the debt of mining and resource companies and high-end luxury goods manufacturers.

But like most others, CQS’s bearish positions weren’t huge. The $3.4 billion fund Mr. Hintze runs was up 4.8% this year, through the end of June, but is down a tad so far this month, according to investors.

Foreigners can short China-focused exchange-traded funds or derivatives listed outside the country. But those that are easily traded limit investors to a broad negative wager on big Chinese companies, not the stock- or sector-specific bets that many managers favor.

Foreigners can also bet against mainland companies trading in Hong Kong known as H-shares. But it remains difficult and expensive to short mainland-listed stocks known as A-shares, part of the reason why many global funds were slow to join the Chinese rally this year.

Mr. Chanos became bearish on China around the beginning of 2010, worried about rising debt throughout the economy. Since then, his firm has shorted H shares as well as companies at risk if the Chinese economy slumps, such as iron-ore shares in Australia and gaming companies in Macau. He also bet against Hong Kong property companies, banks, shipping, cement and coal producers, and others with heavy exposure to China.

Mr. Chanos has avoided A-share Chinese companies, worried about actions by the government to prop up those stocks.

He says his firm’s bearish Chinese positions have made money for the firm since they were placed, despite the huge rally for Chinese shares in recent years.

“We’ve sold things on rallies” and taken other steps to generate profits, he says.

Mr. Chanos’s fortunes should continue to improve if the Chinese economy continues to slow, something he expects over the long term. “The omnipotence of the Communist party has taken a hit and that’s a real cost,” he says.


http://www.wsj.com/articles/james-chano ... 1436464188

[winston]

Chanos on China: 'It's worse than you think'

By Jacob Pramuk

Source: CNBC

http://finance.yahoo.com/news/short-sel ... 45836.html

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The Man Who Got China Right
http://www.nytimes.com/2015/08/25/opini ... .html?_r=0

[winston]

The Man Who Got China Right
http://www.nytimes.com/2015/08/25/opini ... .html?_r=0

Wasn't he wrong for the last 3 years and only got it right recently ?

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CHANOS: Five things the world needs to understand about China
http://www.businessinsider.com.au/chano ... na-2015-8/

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China's credit event still to come: Jim Chanos
http://video.cnbc.com/gallery/?video=3000418792


China's model broken: Jim Chanos
http://video.cnbc.com/gallery/?video=3000418791&play=1

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Even though Chanos is bearish on the outlook for China, he said he isn’t shorting the country’s stocks because the equity market isn’t a reliable gauge of economic activity. Instead, the slowdown will claim victims in global commodity and mining companies, especially liquefied natural gas producers in Asia, he said. Chanos said earlier this month that he’s betting against Cheniere Energy Inc., a U.S. natural-gas exporter.

China Heads to Japan-Like Slowdown as Debt Swells, Chanos Says
http://www.bloomberg.com/news/articles/ ... hanos-says