Always liked Chanos. The quarterly call with Enron where he asked the tough question that prompted Skilling to – on an earnings call! – unload on him with the A word is in itself enough for lifetime glory.[Self-correction here: Chanos didn’t ask that question on the call, as I’ve learned from digging around in “The Smartest Guys in the Room” book just now. That was another short-seller. However, Chanos was the source who gave reporter Bethany McLean – a reporter for Fortune – the basis for her Enron story that was the first critical coverage of the company (and then morphed into the book and documentary film). It is his research that showed something to be very wrong with Enron and its impossible-to-read financial statements. He says that he didn’t know at first it was a fraud, just thought it was a bad business, but he went way short on it. Then he watched as it all unraveled. I was thinking of deleting my post above, because it was wrong, but it’s clear my mind just conflated two shorts and gave credit to Chanos because he really does deserve credit for detecting the fundamental problems with Enron’s accounting and taking down the company. Apologies for the initial garbled version. Btw, the book has a long history of Chanos’s record before that, which includes some other impressive calls. But being the first Enron short, when everyone else thought it was the future, has to be his best.]
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