Jim Chanos: short sellers are heroes
I just watched a great clip of an interview Jim Chanos, the famous head of hedge fund Kynikos Associates, did with the FT’s Gillian Tett (Hat tip FT Alphaville). Chanos does a very good job of arguing hat short sellers are being unfairly victimized by government. Basically, he and other hedge fund managers like John Paulson have been warning al of us for months that what we are seeing now would come to pass and that the financial services sector was over-leveraged.
Banning short selling is like shooting the messenger. It doesn’t get at the root of the problem, but rather scapegoats the very people warning us of the pitfalls ahead. Chanos also says that we are kidding ourselves if we think the Paulson plan Economic Patriot Act is going to solve the mess America is in. You have been warned.
Below is the video.