We obtained a copy of James Chanos’s presentation at the second Virginia Value Investing Conference that took place from October 22 to 23, 2009. The title of the presentation is “Ten Lessons From The Financial Crisis That Investors Will Soon Forget (If They Haven’t Already!)”
Now who is James Chanos? According the conference website:
Mr. Chanos is the Founder and Managing Partner of Kynikos Associates. As the largest exclusive short-selling investment firm, Kynikos provides investment management services for both domestic and offshore clients. Through investment funds, partnerships, corporations and managed accounts, both domestic and offshore, Kynikos Associates maintains private portfolios of securities for clients. The funds, Ursus and Kynikos Opportunity, attempt to profit from the unusually high alphas found on the long and short side of the U.S. and non-U.S. equity markets.
Mr. Chanos opened Kynikos Associates in 1985 to implement investment strategies he had uncovered while beginning his Wall Street career as a Financial Analyst with Paine Webber, Gilford Securities and Deutsche Bank. Throughout his investment career, Mr. Chanos has identified and sold short the shares of numerous well-known corporate financial disasters, among them, Baldwin-United, Commodore International, Coleco, Integrated Resources, Boston Chicken, Sunbeam, Conseco and Tyco International. His celebrated short-sale of Enron shares was recently dubbed by Barron’s as “the market call of the decade, if not the past fifty years.”
Born and raised in Milwaukee, Mr. Chanos currently lives in New York with his four children and is active in many charitable foundations and educational institutions. Mr. Chanos received his B.A. in economics and political science in 1980 from Yale University.
These are the ten things James Chanos wants us to learn and remember:
1. Borrowing Short and Lending Long is Still a Bad Idea
2. Accounting Matters…A Lot!
3. Conflicted Rating Agencies: Still Not Unbiased Observers
4. Regulate the Activities Not the Actors5. ‘Value at Risk’ May Put Your Firm at Risk
5. Messrs. Glass and Steagall Were Right After All
6. Too Big to Fail = Too Big to Exist
7. Capitalism on the Upside and Socialism on the Downside is Bad Policy
8. Quantitative Easing (‘Helicopter Finance’) Has a Cost
9. Insurance Without Reserves is Not Insurance
10. Shooting the Messenger Does Not Change Reality
James Chanos explained what he meant in details in the presentation.
P.S. If you attended the conference and have notes and presentation that can be shared with us, we certainly appreciate.
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