Photo: hackdaddy via Flickr
Earlier we noted the fun fact that the only known Democrat to sign the anti-QE open letter to the Fed was Jim Chanos, a short seller.But it’s worth being more specific about how, in fact, quantitative easing affects Chanos. Bear in mind that his biggest idea right now is that China is the next Enron, and that its collapse will take down all sort of related commodities, Australia, etc. (actually, technically its not known how he’s betting on China’s collapse, but people have made pretty educated guesses).
Now also bear in mind that QE is blamed for fueling an emerging market bubble, and a corollary commodity bubble, so it really is a dead-on attack on this idea.
Perhaps Chanos really doesn’t believe QE can work, but we KNOW for a fact that it’s hurting his own portfolio, and that explains why he’s on the list.