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Chanos Bullish on Cisco, Bearish on China, Greece

Thursday, 4 Feb 2010 | 10:32 AM ET

James Chanos, the well-known contrarian investor who runs the hedge fund Kynikos Associates, joined the "Squawk Box" team, offering his perspectives on Cisco, China and Greece.

Chanos, a short-seller who bets against companies, made his fortune by foreseeing the collapse of Enron and other highflying companies whose stories were too good to be true.

Chanos Shares Short View on the Markets
Famed short-seller James Chanos, president of Kynikos Associates, shares his market insight.

Bullish On Cisco

“Cisco’s obviously on the cutting edge of this stuff… They were early on in figuring out that the consumer was going to drive the technology upgrades in this cycle to a great extent. To (CEO John) Chambers’ credit, they saw this ahead of the curve better than most, so I think they’re probably the best positioned.”

Counting on the China Bubble

“The bubble that’s going on in commercial and residential construction, infrastructure construction and manufacturing construction is unlike we’ve ever seen. This is a fixed asset investment boom and it is of staggering dimensions… It is clearly a bubble in the property markets and construction markets. That’s what we’re pointing out.”

Chanos' Parting Shots
James Chanos, president of Kynikos Associates, shares his parting shots.

China’s Banking System

“There’s almost 70 billion in square feet under construction in high rises in commercial, residential and light manufacturing. And we estimate about 30 billion square feet, and that’s with a ‘B,’ is commercial, that we would just consider office space. To put that in perspective, that’s a 5x5-foot cubicle for every man, woman and child in China. These are really staggering, staggering numbers… The banking system is the problem. The banking system is loaded with bad debts. Remember the state controls the banking system there, and the assets of the banking system are suspect.”

Chanos' Market Insight
James Chanos, president of Kynikos Associates, shares his market insight with CNBC.

Debt Crisis In Greece

“Greece is always said the country of my ancestors has long been a society of many chiefs and no Indians as someone once said. They’ve got some real problems that they don’t even want to fess up to themselves. Whether the EU does anything to help them out, I don’t know.”

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