China, Says Chanos, Is a ‘Terrible Place to Keep Your Money

As a veteran short seller, Jim Chanos knows when something is a bad investment. Right now, that would be China. Being bearish on China is nothing new to Chanos—he has been a non-fan for a long time, especially about its over-built real estate.

The latest trigger for his China pessimism is the trouble with debt-laden Evergrande Group, whose Monday, helping drive down international markets. Evergrande, China’s second-largest property developer, is emblematic of a larger weakness in China, he indicated. Chanos told CNBC he was troubled that the iShares China Large-Cap ETF [exchange-traded fund] has dropped more than 12% over the past dozen years, but China’s economy has ballooned.

“It’s the only major market, as I keep pointing out, for the past 12 years that’s gone down, and over that time frame the Chinese economy has more than doubled. I mean, this has been a terrible place to keep your money as a Western investor, and I think it will continue to be,” Chanos said. “Shareholders and creditors are just not treated well in the Chinese economic model, and I think that will continue.”

The founder of investment firm Kynikos—meaning “cynic” in Greek—Associates, he gained fame for shorting Enron, a great call when the energy seller collapsed in December 2001 amid a welter of accounting fraud revelations.

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Chanos has warned for more than a decade about a bubble in the Chinese real estate market. He said he does not have a bet against Evergrande, but he is short “a couple of the larger Chinese financial institutions with what we think are pretty bad loan books.” In addition, he said, “We also short a couple of the cross-border giant banks that trade in London, with very large Hong Kong and China property exposure.”

Angelo Manioudakis

Northern Trust Asset Management has named Angelo Manioudakis as its new CIO to oversee the firm’s more than $1.2 trillion in assets under management (AUM). Manioudakis, who will start his new job on September 27, replaces Bob Browne, who retired in June after more than 12 years as CIO to become a private investor.

Manioudakis was most recently a managing partner with Lantern Harbor Investment Partners, a Boston-based global alternative investment firm that he co-founded in December 2019. Before co-founding Lantern Harbor, he was CIO of Fidelity’s Global Asset Allocation division for a little over five years. While at Fidelity, Manioudakis oversaw approximately $500 billion in assets and earned significant growth in the firm’s outsourced chief investment officer (OCIO) business, according to Northern Trust.

Prior to Fidelity, Manioudakis was head of public fixed income and derivatives at Sun Life Financial for a little over three years and before that was CIO – institutional fixed income at Oppenheimerfunds for nearly seven. He was also a portfolio manager at Morgan Stanley after starting out his career as a financial analyst at GE Capital.

Manioudakis, who will report to Northern Trust Asset Management President Shundrawn Thomas, earned a bachelor’s degree in finance from Bentley College and a Master of Business Administration from Harvard Business School. He is also chair of the American College of Greece’s endowment and oversees its investment committee.

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Manioudakis’ responsibilities will include investment performance, process, and philosophy for all Northern Trust Asset Management products. He also will be chair of the firm’s investment policy committee, which establishes investment policy for all Northern Trust groups in all asset classes.

“Angelo has a proven track record of leadership in the investment management industry spanning three decades,” Thomas said in a statement. “His experience is ideally aligned with our investment philosophy centered on compensating investors for the risk they take in all market environments.” He added that Manioudakis “is uniquely qualified to empower our investment professionals to advance our aims of delivering distinguished thought leadership and innovative investment solutions to our clients.”