The Golden Age of Fraud in Finance

Jim Chanos, the president and founder of Kynikos Associates and well-known investment manager talks to Rob about the post-pandemic financial system, which has become more steeped in a casino culture than it has been in a very long time, and whether China's financial situation serves as an example or as a warning.

[tuberific]

I recall a conversation I had with someone in 2016 who believed that Trump was incorruptible because "he has his own money to campaign with." So while I agree with this vid's premise that "a lack of confidence in the system" led to Trump, I think of equal importance is a lack of understanding about the system itself. The Financial Crisis Commission Report concluded that deregulation was the core driver of the 2008 crisis. The SEC was blocked from regulating the speculative instruments that allowed banks to abandon lending standards. Trump didn't run on an oversight platform, and in fact exacerbated deregulation along with passing massive tax cuts for the wealthy that created no new jobs. So, clarifying the narrative of what actually causes financial turmoil from a textbook standpoint is a significant hurdle that should be overcome.

[fabiodeoliveiraribeiro]

There was something very interesting about Don Quixote's journey. While he roams the world in search of adventures whose main characteristic is the difference between what really happens and what the sad figure knight perceives to be happening, there is NO economic concern. Only Sancho Panza really cares about amassing a fortune. Eventually he succeeds in doing so, but that is not the main theme of the story. The beauty of Cervantes' work actually emerges precisely from the fact that Don Quixote wastes his energy and resources in crazy, illusory, ridiculous and therefore comic and tragicomic combats. Originally, capitalism valued the pragmatic Sancho Panza: he accompanies Don Quixote, but tries to save some money and never loses sight of his petty personal interests. But now everyone (including ordinary Americans who are supposed to emulate Sancho Panza) has gone berserk and is acting like Don Quixote. At the end of his journey, Cervantes' character regains his senses just before he dies. I suppose millions of Americans will die without realizing the bad trip and tragicomic journey they jumped on.

[tomkarnes]

Outstanding discussion more of this please

[VickiNikolaidis]

China also raised its impoverished out of poverty. The people still have work to do, but the improvement can't be denied. That's the shovel digging in the ground literally.

[coryc.]

I hadn't thought about single payer healthcare saving social security before. All those savings plans would be inherited instead of going to healthcare, nursing and end of life care.

[annamaedevlin]

Two words ring true! MONEY POLITICS! NO REGARDS FOR US!

[theabominable]

“God wasn’t born in Detroit or Pittsburgh but he ended up vacationing in Davos” brilliant from Chanos

[staninjapan]

I am not sure which is more disconcerting, the conversation about the potential loss of (presumably civil) freedom if/when the digital/crypto currencies are further brought into line (not that I feel they should be), or the calmness and and acceptance displayed during the conversation.
A very interesting conversation, about which I understand too little.

[GimbloBlimfby]

Some phenomena are so important that they cause very different people to transcend personality and ideological differences. Worth watching to the end.

[Mhm]

45:10 forward brilliant and interest point to investigate and understand.

[terriej]

When it comes to our politics these days, things are always worse than what we think they are, unfortunately.

[mikelixx]

Great discussion. Thanks for sharing. Just the item on the chinese issue is strange. Some are really good insight and some really off the chart.

[BobQuigley]

Interesting that China's two sessions happening now is featured on CGTN China's YouTube channel. Watched bits here and there. The main focus seemed to be education, more engineers,

[craigwilson]

Very educational presentation Rob. While austerity tears 180 million working class families apart, the financial sector, Black Rock, Vanguard and Safe Street continue to make trillions for their shareholders in what is clearly an attempt to one day become the only and wealthiest private equity firm on earth. The financiers of this abominable, class war being perpetrated upon the working poor and the environment is unsustainable, and the $31 trillion national debt along with the $200 trillion dollar corporate and household debt is unserviceable.

[BobQuigley]

US has been involved in over 240 conflicts including three hot wars over last 25 years. Iraq was an illegal war. Would argue US has been externalizing forty years of bad decisions blaming others. Endless movies etc attacking our enemies dujour. China needs massive quantities of fossil fuels, Russian friendship in spite of hundreds of years of hate and animosity inevitable

[patbyrneme]

Why does Jim Chanos recommend that China move on to the Western economic model which is failing so badly to deliver growth and subject to so much fraud as Jim so eloquently explained. The Chinese model has been peforming spectacularly with certain exceptions such as in the real estate sector which ironically happened because of lack of regulation. The latest crackdown on tech moguls is a very healthy development as it is workibg against the new wave of monopolisation which is now undermining America's economy.
Last but not least, China's debt is not the same as Japan's was. Jim Chanos conveniently forgot to mention that a major proportion of China's debt has arisen from public investment in infrastructure, innovation, etc. all of which is generating major benefits to China's economy and society.

[peetsnort]

Money changers
Money launderers
What's the difference
All play with other people's money

[Ukrainianbankaccount]

Chanos is so overrated. Chanos & Company isn't doing well. In terms of AUM from $6 billion in 2010 to $405 million in 2020. Chanos does seem to be able to charm journalists because I never see them ask hard questions about his fund's poor performance and track record since Enron of a lot of bad calls. He has been predicting calamity for China since 2009.

[swedesam]

Jim Chanos, one of the few sane investors with solid analysis in this market.

[BobQuigley]

How does US book $$$Pentagon money? Does $31 trillion US debt have any consequences?