Chanos Says Financials Have Bottomed Out

Sep 10 2008 | 3:51pm ET

With the doom and gloom surrounding Lehman Brothers, it might seem a strange time to say that financials have hit bottom. But that’s exactly what Jim Chanos has done.

The Kynikos Associates chief said on CNBC that Wall Street’s worst has past.

“We have probably seen the worst in financials,” Chanos said, adding that he has slashed his short positions in financials because most of the bad news about the sector is already out there. Instead, the $5 billion hedge fund shop is focusing on companies involved in commodities.

“We would short companies that might depend on cement prices or steel prices going up,” Chanos said. He would not say what names he is currently shorting.

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