Did somebody call? Skeptic here. I first heard of Jim Chanos in about 1984 when he was a Duff & Phelps analyst in Chicago. A client asked me about an annuity which would yield 10.5% annually. I told him don't touch it. He asked why. Because AA corporates yield 12%. If it costs the insurance company even 1.5% per year to run the annuity, it can't pay off. The product can't work. The client was furious, "But the salesman said ... " I said, "Of course. He's got a commission on the table. What's he supposed to say"? Chanos went further and realized the company offering the product, Baldwin-United was insolvent. Had I only thought about the issuer instead of the product I could have made a beautiful short sale. I have followed Chanos' career ever since. I believe the "Macquarie model's" biggest risk is political: how long will localities let Macquarie raise fees to use its assets? This seems to be what lets Macquarie work: it gives politicians cover to raise user fees. Whenever you see a new financing "innovation" ask: what operational changes will the new owner make the old one couldn't?
I disagree with Chanos about one thing: inflation is a more efficient way to legally relieve investors of their money than Macquarie could ever hope to be. As a world renowned expert in relieving investors of their money said, "The way to crush the bourgeoise to to grind them between the millstones of taxation and inflation". Who was he? Lenin.
That "every smart young Australian" wants to work for Macquarie, I see as a very negative indicator. The kids are usually behind the curve.