"If you looked at the performance of the banks over the last two years...they have been great shorts," billionaire short seller Jim Chanos said during an interview on CNBC. "They have been going down — they're down 30 percent over the last two years." He said they continue to be shorts.
Chanos sees political instability in China as adding to problems for the Chinese banks.
"In China, remember, the the banks are arms of state policy. They loan because the local party official or regional party official tells them we need a new stadium. They are instruments of state policy."
"Some people have dubbed the party 'The Family,'" said Chanos, comparing the communists to the American Mafia. "We're seeing more than a peek behind the curtain, we're seeing a real struggle."
Personally I see shorting as risky at the best of times. In an inflationary environment I would rather just be long gold, silver and oil.
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