Fascinating Conversation With Renowned Short Seller Jim Chanos

Please consider a Conversation With Renowned Short Seller Jim Chanos on Hedgeye TV.

The videocast is a bit over an hour long, but well well worth the time.

Topics

• An Explanation of His Investing Process
• China: Cyclical Recovery Pending or Secular Slowing?
• Chanos' Top Short Ideas Right Now
• Tesla and Netflix

My Notes

1. Chanos most often focuses on serious fundamental business model flaws. True fraud is rare.
2. Lots of things fail for reasons that should be obvious, but somehow aren’t.
3. Wall street has a long history of believing 2+2=5.
4. China is still the biggest real estate bubble in history.
5. No bubble or fraud is the same, but the fundamentals and parallels repeat.
6. Similarities between Japan in 1980's and China Today.
7. At the 32 minute mark, Chanos discusses Tesla.
8. Tesla remains one of Chanos' biggest short positions
9. Run the numbers on Tesla you get a stock market value of zero.
10. The rest of the car industry, notably Porsche, is catching up on technology
11. Tesla Model 3 demand Is plateauing
12. Tesla gross margins not improving.
13. Solar panel assets are really liabilities.
14. Pro-forma accounting share-based comp hiding in plain sight - In general, not just Tesla
15. Netflix has become what it once disrupted. It is now creating shows and that changes its business model dramatically. Netflix is a fraction of the digital disruption it once was.

Inquiring minds may also wish to consider Mish in the Arena with Hedgeye: Hiding Out in Gold and Treasuries