Tuesday, October 11, 2011
Chanos and China
Jim Chanos is negative on China. He has pushing this negative story for what seems like years. Bloomberg reported that he is shorting Vale the Brazilian iron ore company and other commodity related firms selling into China. Vale reported sold 41 percent of production to China in the first quarter. This may be a more effective way to trading China equity and economic risk than taking short positions inside the country.
This has strong implications for commodity markets if other traders are going to follow the same path. Industrial metals prices will remain heavy with China growth uncertainty.