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Credit Markets Are Partying 'Like It's 1999,' Chanos Says
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October 22, 2025
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2:40Now PlayingChanos & Company President and Founder Jim Chanos says it's a "party like it's 1999" in credit markets. He speaks to Bloomberg's Scarlet Fu.
Carvana Co. raises “lots of red flags,” especially after the recent implosion of auto lender Tricolor Holdings, says famed short-seller Jim Chanos, who has singled out the online car retailer over the past several years.
“Given the news in the subprime auto space of defaults, bankruptcies, rising delinquencies, the fact that Carvana seems to be sailing through it with nary a scratch stretches credulity,” Chanos said during a Bloomberg Television interview on Wednesday.
Chanos, who turned his hedge fund into a family office in late 2023, pointed out that Carvana books hefty gains on the sale of auto loans. He also pointed to Carvana’s ties to its loan servicer Bridgecrest. “We just don’t have complete transparency as to what’s going on.”
The stock market’s three-year bull run has not been kind to short-sellers. But concerns about faults in the credit market have put a damper on the rally in US stocks in recent days after the sudden collapse of Tricolor Holdings. The used-car company, which once touted its end-to-end model, has raised the alarm bells over risky subprime auto loans.
Carvana shares sank as much as 13% Wednesday, the worst intraday drop since April’s tariff shock. Despite recent weakness after Tricolor filed for bankruptcy, the stock is still up more than 50% this year.
Chanos first went public with his short position in early 2022, by December of that year, the stock was trading at an all-time low. In 2023 Chanos again took aim at Carvana. Yet, the stock has soared more than 8,000% from its 2022 nadir, spurring Chanos to once again revisit the name this year after the stock’s huge rally.
A majority of the company’s operating income over the past year came from the sale of subprime loans, but the revenues from car sales are declining, he has argued previously.
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