Hayman Capital Management founder Kyle Bass is known for making valid stock market predictions. In an interview with Bloomberg News, he stated that China has a very vulnerable banking system and investors should think twice when it comes to dealing with China.
“Anyone who takes a good hard look at what’s going on with China can see the writing on the wall,” said Bass. At Milken’s Global Economic Conference on Wednesday, Bass repeated his assertions that China is not in a good place. “China is in a very precarious position. Allocating money there is just not using common sense,” said Bass.
Bass made his bones in the industry by betting against sub-prime mortgages. In fact, he made a bundle during the banking crisis of 2008 when he correctly predicted the banking collapse. Bass is so certain of China’s position that he is raising a dedicated money fund for bets.
It’s only a matter of time before they bottom out, according to Bass. “I just hope investors putting their money into China can handle 30 to 40 percent write downs.”
While some people have a great deal of faith in what Bass has to offer, a number of people deem him as one of the most odious and dishonest people in the banking industry.
According to some, the subprime mortgage collapse of 2008 was the beginning and the ending of Bass’ career. Most of his other predictions meant very little or were so far off the mark that they were useless anyway.
Critics say that Bass has not only made many recent bad calls, he is also consorting with questionable individuals like Kristina Fernandez de Kirchner of Argentina (and we all know what’s happening there)and Coalition For Affordable Drugs CEO Erich Spangenberg.
Spangenberg, in particular, is considered a con man of he highest order. His scheme is short-selling pharmaceutical stocks then challenging patents, thus harming millions of individuals who rely on the companies medications. Although Bass was warned about what Spangenberg was doing, he had no problem jumping in with both feet.
Bass is quickly gaining a reputation in the industry for being all about money, and to hell with anyone or anything that gets in his way. Bass has had a tough two years, according to financial guru Jim McTeague. “He’s lost big time. And if he isn’t careful, he’s not going to have anyone else to suck up to.” ZeroHedge writes more about Kyle, and the mistakes he’s made.