James S. Chanos

James S. Chanos grew up in Milwaukee, one of three sons of the owners of a chain of dry cleaners. At Yale, he was a pre-med student before switching to economics because of his passionate interest in the way markets operate.

Chanos discovered his guiding philosophy in a book called “The Contrarian Investor,” according to a summary of his life in “The Smartest Guys in the Room,” a book that followed Enron’s rise and downfall.

After college, James S. Chanos went to Wall Street, where he worked at different brokerage houses before starting his own firm in 1985, out of what he later said was frustration with the way Wall Street brokers sold stocks.

At Kynikos Associates, James Chanos developed a firm focused on trading based on falling stock prices. His theories are summarized in testimony he gave before the House Committee on Energy and Commerce in 2002, after the Enron debacle. His company, he said, searchs for companies that appear to have overstated earnings, like Enron; were victims of a flawed business plan, like many Internet firms; or have been engaged in “outright fraud.”

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