Jim Chanos on Who's Getting Caught Swimming Naked
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What is the opening premise about “swimming naked” and why does it matter now?
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Bloomberg Audio Studios Podcasts Radio News.
Hello and welcome to another episode of the Oddlots podcast. I'm Joe Weissenthal.
And I'm Tracy Alloway.
Tracy, I guess one good thing about market cr I don't know if it's even good, 'cause I like when lines go up no matter what. But you know, people always say, Oh, this can't go on forever and they're talking about some specific trend or here's a scam or here's a bezel in the economy that will exist as long as the lines go up, things get revealed in a downturn. Things that were unsustainable are shown to definitively be unsustainable when the downturn hits.
Right. What's that old Buffett quote when uh you don't see who's swimming naked until the tide starts to go out? And I I think I think we are probably at that moment. And I gotta say, in terms of who likes uh when lines go down, you know who likes when lines go down?
Yeah.
Short sellers.
That's right. They definitely do. Especially when it's been like fifteen years since the line has gone down and so many short sellers have had such a uh brutal time. Maybe we'll put swimming naked in the headline of this. Instead
of uh dead bodies floating to the top? Floating to the top.
Maybe it's a little well we'll have to figure out. Anyway, let's just jump right to it. We've had him on the show in the past. Someone we always enjoy talking to. He is going to tell us about what bodies are going to float to the surface. And those bodies happen to be naked too. He's gonna tell us what naked bodies are floating to the surface. Jim Chainos, founder of Chainos and Company, longtime investor, short seller. Uh thank you for coming back on Odlots.
No, thanks for having me. It's my pleasure.
I only recently learned that uh Scott Bessant I say I only recently learned is if I looked this up, I heard it from you as you were walking into the studio. He worked for you.
Yeah, he was my first analyst.
Incredible.
I taught him everything he knew up to a point, I guess. Up to a point. Okay.
All right, I'm just gonna ask basic questions to start, but what has the past week or so? Let's see, we're recording this on April ninth
at eleven twenty eight AM.
Yeah, we have to be that specific on the time now because things change so quickly. What has the past week been like for you?
Well, I uh we're not in the business of running outside money anymore. So that ended a couple of years ago, but we do advise clients and and of course run our own money. So um uh since nineteen ninety six we've always been hedged. But uh we've seen obviously substantial alpha in the last couple of weeks. Uh the i.e. the stuff we're short has gone down much more than the market. We tend to be long the market passively. And that usually happens, right? Uh when the market uh shifts gears, a lot of the the more questionable story stocks, frauds, hypes uh begin to underperform. Yeah. And and that was not the case until really about the tariff, uh the Liberation Day. And now it's really kicked in.
If I'm a uh equity if I'm an asset allocator, is that why I allocate to someone who specializes in short selling? Not because they are going to give me positive returns month after month after month, but that it allows me to be more comfortably long risk assets in my other investments because I have this knowledge that I'll get outside return outsize returns from you when they go down.
Yeah. I mean in our business model over forty uh forty years, um basically it it morphed into the the idea that fundamental shorts allow you to be more long. Yeah. And and and that's that's really at the end of the day, your shorts are financing your long portfolio.
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Chapters
8 chapters
1
What is the opening premise about “swimming naked” and why does it matter now?
0:00–5:37
2
How does Jim Chanos explain the role of short‑selling in today’s market volatility?
5:37–11:19
3
What recent market shifts (tariffs, “Liberation Day”) are causing story‑stocks to underperform?
11:19–17:13
4
Why are AI‑driven data‑center plays losing steam and what should investors watch?
17:13–23:31
5
Is Elon Musk’s Tesla still a viable long‑term bet or is it a bubble?
23:31–29:48
6
What are the hidden risks in private‑equity and Medicare‑Advantage investments?
29:48–35:26
7
Which historical analogies help us understand today’s macro‑economic turbulence?
35:26–39:43
8
What final insights does Jim Chanos leave listeners with about market cycles?
39:43–42:17
Speakers
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