Slideshow: Apocalypse How? Dire ’12 Forecasts

By Ben Steverman - 2012-01-14T03:12:30Z

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Jim Chanos

Short-seller Jim Chanos, founder of Kynikos Associates, gained fame when he predicted Enron's collapse in 2001. In late 2011, he was betting on an even bigger failure -- that of the financial industry of the world's second-largest economy. "The Chinese banking system is built on quicksand and that's the one thing a lot of people don't realize," Chanos told Bloomberg Television in late November. "The banking system in China is extremely fragile," he said, because of non-performing loans made in the late 1990s and early 2000s. On Jan. 13, a Bloomberg story cited a China Banking Regulatory Commission statement asking large banks to make "sound" business plans for 2012, and noting challenges to "a steady development" of China's economy.

(Left, students apply for jobs during a job fair at Shanghai International Exhibition Center.)

Photograph by ChinaFotoPress via Getty Images