John Paulson: Villain or Genius?

That's the subject of my latest Portfolio article, which is online here.

In the context of an in-depth profile of John Paulson, I discuss the role of short-selling in the recent calamity. Note Jim Chanos's account of a conversation that he had with Alan Schwartz of Bear Stearns (BSC) just before Bear went belly-up.

According to Chanos, Schwartz tried to get him to go on CNBC to say that "everything's fine."

Schwartz denies the account. Who do you believe?

UPDATE: Portfolio's Felix Salmon follows up and says that he misread the article as an attack on shorting (quite an amusing thing that would be, coming from me). As I told Felix, I don't think Paulson did anything wrong.