First with Financial Comment from Arabia

Shorting king to speak about China in Oxford

with 2 comments

Hurry along to Oxford on January 28th if you are in England and want to hear why the king of shorting financial markets has now turned his attention to China.

Jim Chanos, president and founder of Kynikos Associates, has the kind of short- trading record to make disbelievers gasp. From Enron to sub-prime he has got it right. And now he is shorting China.

How can that be? Everybody knows China is the global power house of the future where nothing can go wrong. Just like Enron was going to become the world’s biggest energy trading company, or nobody could lose by buying a house!

China fans like Jim Rogers are up in arms and say Mr. Chanos has got it all wrong. But has he? His argument is not that China does not have an amazing future. It is rather that Chinese asset prices are massively over-priced due to a stimulus package equivalent to half of national GDP last year.

With the benefit of hindsight he will be seen to have been so obviously right, just as he was on sub-prime mortgages. (click here for a more detailed story)


Written by Peter Cooper

January 11, 2010 at 9:16 am

2 Responses

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  1. Might the short king be trying to talk it down in order to make a fast few hundred million? Naw, he wouldn’t do that.

    Bill Simpson in Slidell

    January 12, 2010 at 2:25 am

  2. Here is my guess. Asian markets will continue to climb until Chinese New Years comes around. Notice how the Chinese government passed a law allowing shorting to take place after Chinese New Years. After Chinese new years is when all hell should break loose with shorts shorting the market and the governments in China and the US pulling out their stimulus funds from the market. I am seeing this as perfectly timed.

    I could be wrong but this is how I see it happening so until then they will pump share prices as high as they can before the big dump.


    January 11, 2010 at 8:09 pm

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