The hedge fund manager also sounded the warning bell about the outlook for Chinese inflation.
“We’re bearish on China’s property sector and the credit sector,” Chanos told CNNMoney at the Milken Institute Global Conference in Los Angeles. “This is a country that’s in the middle of an epic property bubble and construction bubble that will end at some point and it won’t be pleasant when it ends.”
Home sales began slowing last year, he said. But the problem is construction continues to outpace demand, and that can skew China’s gross domestic product figures.
Is China faking its economic growth?
“In China’s GDP calculations, they don’t look at final sales, they look at production,” said Chanos. “So a condo being built but not sold contributes to GDP.”
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