Jim Chanos: This is Apple’s Big Problem

Jim Chanos says he’s an Apple (NASDAQ:AAPL) skeptic because the stock has risen too fast, too soon. The money manager, who oversees $6 billion at Kynikos Associates, told Bloomberg Television recently in an interview that he was worried that Apple shares had already risen 71 percent this year and that he preferred investing in Microsoft (NASDAQ:MSFT) instead.

“We’re getting afraid of heights,” Chanos said in an interview on Bloomberg Television’s “In the Loop” with Betty Liu. “It [Apple stock] has had an enormous run. Something about it is holding us back in that it’s had such a run.”

Apple has been a huge winning stock pick for Wall St. Cheat Sheet Newsletter subscribers. Don’t waste another minute — click here and get more of our CHEAT SHEET stock picks now.

Apple reached a record high of $702.10 on September 19 on the buzz created by the launch of the iPhone 5. It is now the world’s most valuable company and most analysts are bullish on its immediate future, predicting a 60 percent profit jump this year and a 20 percent growth in 2013.

Microsoft (NASDAQ:MSFT), which was the most valuable company at its peak in 1999, has seen its shares gain 19 percent this year. It is hoping to see an added boost after it launches its Surface tablet as a rival to Apple’s market-leading iPad later this year. Microsoft’s earnings grew 3.4 percent this year and are predicted to rise 11 percent next year.

Chanos also predicted further losses in natural gas producers and said government bonds may decline as the U.S. Federal Reserve starts a third round of asset purchases to boost economic growth. “You’re taking an awful lot of principal risk for very little reward,” Chanos said about Treasuries, according to Bloomberg.

Don’t Miss: Does Apple Have a Widescreen iPad in the Works?