Dr. Mark Mobius, the executive chairman of Templeton Asset Management who is known for his emerging markets expertise, is all over the financial newsscape these days. The following are a battery of links to all things Mobius:

Mobius Recommends S. African, Turkish Stocks, Palladium: Video
Bloomberg, September 4, 2008

Mobius Says Templeton ‘Sitting Tight’ on Thailand Stocks: Video
Bloomberg, September 4, 2008

“Templeton May Add Thai Stocks on Losses, Mobius Says (Update1)”
Susan Li, Chen Shiyin
Bloomberg, September 4, 2008

“Mobius picks South Africa as most attractive market”
Drazen Jorgic
Citywire (UK), September 3, 2008

“FUND VIEW-Templeton’s Mobius sees S.Africa growth”
Peter Apps
Reuters (Africa), September 2, 2008

“China and Russia Are Still Great Investments: Mobius”
CNBC, September 1, 2008

“INTERVIEW: Mobius says all to play for in Turkey”
David O’Byrne
Business New Europe (Germany), September 1, 2008

“UPDATE 1-Templeton’s Mobius likes Russia despite Georgia”
Dan Burns, Herbert Lash
Reuters, August 29, 2008

Well-known commodities investor Jim Rogers is undeterred by the recent selloff in hard assets. Bloomberg’s Rattaphol Onsanit wrote this morning:

Jim Rogers, who in April 2006 correctly predicted oil would reach $100 a barrel and gold $1,000 an ounce, said a tumble in commodities from records represented a temporary reverse in a long-term rally.

“I don’t see that it’s the end of the bull market,” the chairman of Rogers Holdings, said in an interview in Bangkok before speaking at an investor conference later today. “Until either a lot of supply comes on stream or the economy collapses, the bull market will continue,” he said.

The co-founder of the legendary Quantum Fund added:

“I am contemplating whether it’s time to get involved in base metals again,” Rogers, 65, said today. “I haven’t bought any for awhile.”

Onsanit pointed out other areas Rogers felt may have potential. He wrote:

Rogers, who moved to Singapore after selling his New York townhouse last year, said he was still optimistic about agricultural commodities and China’s economy, favoring the tourism, education, infrastructure, and power generation sectors.

Beijing Opera

George Iype of India’s CommodityOnline.com shed some more light on Jim Rogers’ latest investment outlook. Iype wrote earlier today:

The high oil prices and the pull back in some commodity prices on recession fears have not dampened Rogers’ enthusiasm for resources investments. “I am very bullish on metals and precious metals. Crude oil price will continue to rise, because there is a major demand-supply mismatch. Those who blame speculators for high oil prices do not know how the Futures market and oil market operate. Rogers is also upbeat on agricultural commodities. “I am bullish on opportunities in the agricultural commodities market. I am investing there now. The secular bull market in commodities will continue to go on now for some years,” he adds.

Sources:

“Jim Rogers Says Commodities Will Rebound After Drop (Update1)”
Rattaphol Onsanit
Bloomberg, August 21, 2008

“Why Jim Rogers is bullish on commodities”
George Iype
CommodityOnline (India), August 21, 2008

According to the mining investment news site Mineweb, billionaire investor and philanthropist George Soros was significantly active in the mining sector last quarter. Mineweb’s Dorothy Kosich wrote earlier today:

Über investor George Soros stocked up on potash mining shares during the second quarter, increased his Freeport-McMoRan Copper & Gold holdings by more than 1,600%, invested in the world’s largest uranium miner, Cameco, and dumped his holdings in Apex Silver, CVRD and Southern Copper.

Documents filed with the SEC revealed that among the gold companies in which Soros Fund Management maintained its holdings during the second quarter were AngloGold Ashanti, Barrick, and Newmont.

Soros Fund increased its holdings in Potash Corp. of Saskatchewan Inc. by 2568%… The fund also enhanced its Freeport-McMoRan Copper & Gold holdings by 1608%…

Among the fund’s new purchases was Canadian uranium miner Cameco… as well as CONSOL Energy Inc., the largest U.S. producer of high-Btu bituminous coal… The fund also initiated holdings in Intrepid Potash, the largest U.S. potash producer…

The Soros Fund reduced to its holdings in IAMGOLD Corp. by 23.3%… Soros reduced to his holdings in Alpha Natural Resources Inc., a Central Appalachian coal producer, by 46.95%…

Meanwhile, the fund sold out its holdings in the world’s largest iron miner, Brazil’s Vale (previously CVRD), as well as its holdings in U.S. silver producer Apex Silver Mines, and also in Southern Copper Corp.

Source:

“Soros increases potash and FCX holdings, drops Apex Silver, CVRD, Southern Copper”
Dorothy Kosich
Mineweb, August 19, 2008

Money managers from around the world gathered in Chicago last week for the CFA Institute’s annual investment seminar. Yesterday, the Chicago Tribune’s Gail MarksJarvis talked about two of the speakers- Jeremy Grantham and Marc Faber. The personal finance columnist wrote:

“I am officially scared,” GMO investment manager Jeremy Grantham told professionals from as far away as Abu Dhabi and Malaysia. “In 2000, we had a technology bubble. But this is massive, a massive credit crisis and a bubble in global housing, global equity and global land.”

Grantham, whose clients have included Vice President Dick Cheney and 2004 presidential candidate John Kerry, warned that the world is working its way through the “first truly global bubble.”

The British money manager shared his investment outlook with seminar participants. MarksJarvis wrote:

When asked by a money manager what he would buy now, Grantham said, “long mattresses” — jesting about the stereotypical nervous behavior of hoarding cash. He seriously suggested: “Put money into something incredibly safe, like a high-quality hedge fund.”

Grantham said rather than buying stocks for the long run now, he would only “short” them, or bet that they will decline in price. He sees “nothing interesting in quality corporate bonds,” and he has been shorting oil. “Commodities had a good run, but that’s over,” he said.

Although downtrodden mortgage-related bonds might be a good deal now because some are selling for 59 cents on the dollar, he said he wonders if the price will seem compelling if home prices fall another 20 percent or 25 percent.

He confessed to the group that “I bought my first gold last week, and I hate gold. It doesn’t pay a dividend. I would only do it if I was desperate.”

MarksJarvis noted:

Generally, when bubbles burst, the asset prices stay down for lengthy periods. Grantham isn’t expecting the stock market to hit its low until 2010.

The Tribune columnist also talked about Marc Faber, who publishes the monthly investment newsletter The Gloom Boom & Doom Report. She quoted the Swiss-born investor as saying:

The Fed has created a bubble in everything — stocks in emerging market, real estate everywhere in the world, commodities, art. The only asset class that is down is the U.S. dollar…

It is quite likely that the current synchronized global economic boom and the universal, all-encompassing asset bubble will lead to a colossal bust.

MarksJarvis also noted:

And with commodity prices so inflated, he expects an “increase in international tensions” over resources.

Source:

“Even the pros may be stuffing the mattresses”
Gail MarksJarvis
Chicago Tribune, July 29, 2008

It appears that billionaire investor George Soros believes the price of crude oil will be heading south, while gold goes up. From “The Croesus Chronicles” on the Forbes website yesterday:

Soros finally shorted oil at $137 a barrel and put on a long position in gold; he expects to see gold hold its ground even if oil continues to decline. In fact, the gold bug clique believes in a consistent 10-to-1 ratio for gold and oil. It holds that either gold will rise to 10 times a barrel of oil ($1,350 an ounce) or oil will fall to $96 a barrel–one-tenth the present market price of gold. Croesus was told Tuesday that statistics spanning many decades support, on average, this 10-to-1 ratio.

Source:

“Gold And Oil For Soros; Illiquidity At Merrill”
Forbes, July 17, 2008

When it comes to commodities, Marc Faber, know as “Dr. Doom” by the financial press, prefers gold over oil. During a conference call hosted by U.S. Global Investors last Friday, Dr. Faber, who is famous for advising clients to get out of the U.S. stock market one week before the October 1987 crash, said:

I personally would rather buy gold at this stage than oil.

Nathan Becker of MarketWatch wrote Friday:

Although he said he wouldn’t rule out oil prices rising to $150 or $170 a barrel, Faber said the U.S. government’s recent discussions about how to limit speculative trading in oil futures could pull the plug quickly.

“I think we could have a serious correction — to $100 or below,” he said. “To curtail speculators in commodities in the U.S. could drive people like the pension funds… to go and buy gold.”

Faber also mentioned that gold is “very, very cheap” compared with oil now and that the oil-to-gold ratio is at its highest level ever.

Cheap?

The publisher of the monthly investment newsletter The Gloom Boom & Doom Report continued on this theme while speaking to CNBC’s “Worldwide Exchange” Friday. From the CNBC website:

Investors should go into gold as its price did not rise as fast as that of other commodities while the central bank keeps printing money, Faber said.

The Swiss-born investor told CNBC he believes gold may continue to shine while demand for other commodities declines as the result of a slowing global economy.

Sources:

“Contrarian investor prefers gold over oil”
Nathan Becker
MarketWatch, June 27, 2008

“Let Big Brokers Fail; Buy Gold Not Oil: Marc Faber”
CNBC, June 27, 2008

CommodityOnline.com (India) interviewed noted investment advisor and fund manager Marc Faber by telephone recently. CO reporter Sreekumar Raghavan wrote:

The artificially low interest rates set by US Federal Reserve should be blamed for the increasing speculation in home stock, bonds and commodities, according to Marc Faber, globally renowned investment advisor and fund manager who runs the website Gloomboomdoom.

In a telephonic interview with Commodity Online from Hong Kong, Marc Faber said that because of the recessionary trends in US economy both trade and current account deficits are declining which means less liquidity in the international markets. This means commodity prices could decline although in the near term both gold and oil prices are bound to move up.

Dr. Faber, like legendary oil investor T. Boone Pickens, Jr., questions the impact of speculators on high oil prices. Raghavan wrote:

Faber said that the role of speculation in rising oil prices may be a little over estimated because it indeed is a result of supply demand mismatch. From 1980 to 2000 period, very little new investments went into mining and exploration which is the main cause of the present crisis… Increased demand from countries like India and China whose economy is fast growing has resulted in a shift in demand curve to the right.

The publisher of the monthly investment newsletter The Gloom Boom & Doom Report also talked about emerging markets. The CO reporter wrote:

He said he is upbeat on the prospects of emerging countries in Africa, Asia and Latin America but investors and speculators are yet to fully understand the potential lying in these countries.

Source:

“US Fed Reserve’s policies led to rising speculation”
Sreekumar Raghavan
CommodityOnline.com (India), June 14, 2008

Marc Faber spoke to Bloomberg Television by phone earlier today and had the following to say:

Obviously, the economy is already in recession. Corporate profits will disappoint. In particular, the consensus earnings for 2009 are still far too high. And after jobs creep downward, obviously valuations look less compelling.

Well, I would say, what we are in, is kind of a water-torture bear market. A lot of stocks peaked out already in 2005, like to homebuilders. And in 2006, the subprime lenders. Then in 2007, all financial stocks… And I think the cyclicals, and the energy, and the materials stocks, like steel and iron ore companies, they will now all come under pressure… but I think other sectors of the market that have held up well are now vulnerable.

On what investors should be buying, Dr. Faber, who is known for advising clients to get out of the U.S. stock market one week before the October 1987 crash, said:

I think the question should be, what sector should you sell… I don’t see any compelling value in equities. I also don’t see any compelling value, in say, real estate, or in the commodity market. I think asset markets are still inflated. And we are in an environment, contrary to the last 25 years, during which leverage increased. We are in a period of deleveraging.

Responding to the question of whether or not investors should park their money in cash, the editor of the Gloom Boom & Doom Report said:

Well, cash is not desirable in the sense that it loses its purchasing power because you have a money printer at the Fed, Mr. Bernanke… His monetary policy inevitably is inflationary, and as a result, leads to a lower dollar.

When Bloomberg asked if high oil prices were unjustified, the Swiss-born investment adviser said:

My view would be that commodities will rather ease, as some have already done…

(On oil) The big upside is now gone. And so I would be a little bit careful about blindly buying commodities. I think they’re on the high side, the way real estate was on the high side, the way stocks were on the high side. I would not short commodities, but I would be careful about buying them here.The dollar has some upside potential here. But of course, if Mr. Bernanke continues to print money and push down the Fed funds rate to zero, then the dollar won’t go anywhere. As of today, I believe the dollar is relatively undervalued with the euro. I still like gold (transmission garbled)…

Finally, Dr. Faber had this to say when asked to pick one investment for next 6 to 12 months:

Well, I would take a holiday and forget about the speeches of Fed governors, because their economic knowledge, is in my opinion, is extremely limited. And each time they speak, they actually confuse the issues. And so, there is very little sincerity, at the present time.

You can listen to the 8 minute 21 second Bloomberg interview here.

Source:

Marc Faber Interview
Bloomberg, June 9, 2008

Jim Rogers appeared as the featured guest on “The Gold and Silver Review” on Wednesday. The CEO of Rogers Holdings talked to Chris Waltzek about his economic outlook and investment strategy:

Federal Reserve & U.S. Monetary Policy

America’s had three central banks. The first two failed. Looks like this one’s going to fail, too. So I think it’s better to close it before it fails, rather than after it fails.

Banks are designed to bail out bankers. They’re not designed to bail out you and me. And this central bank is doing exactly that. It’s bailing out Wall Street. What it’s doing is bad for you, me, 300 million Americans, bad for the world. It’s good for a few guys on Wall Street who can keep their Maseratis. It’s not good for you and me.

Interest Rates

They could go to very low interest rates. They probably will. You know, they went to 1% not very long ago.

The Seventies

Unfortunately, the central bank in America is making the same mistakes which they made in the 1970s. The head… was Arthur Burns. He kept printing money as fast as he could, trying to prop everything up, and as you remember, the seventies were a pretty bad economy.

In the 1990s, the Japanese made the same mistake… And as you know, in Japan they talk about the 1990s as the “lost decade.” America’s making exactly the same mistake, and we could have a “lost decade.”

“Remember me?”

Fed Chairman Ben Bernanke

Look, it’s going to get worse, if you ask me… He has panicked, he’s an academic, he doesn’t understand markets, or currencies, or finance. He doesn’t even understand economics we now know, and unfortunately, in the end, you and I are gonna pay for it.

Inflation/U.S. Dollar

It’s certainly too late for inflation and the U.S. dollar. That’s for sure.

Currencies

Chinese Renminbi/Yuan:

China’s on the rise, whether we like it or not. There’s a billion, three hundred million of them, and that currency has to rise over the next several years.

Japanese Yen:

It’s one of the safer investments that I can see… I’ve been buying the Japanese yen from all the speculators… I’m not sure I’d rush out and buy it today… If the yen goes down for a while, I plan to buy more yen.

Commodities

The commodities bull market has another 10 or 15 years to go.

All commodities are in a bull market, a secular bull market, which has several more years to go.

Gold:

I do know it’s going to go a lot higher… I’m sure it will go over $1,500, $2,000. Not this year, probably, but certainly during the course of the bull market.

Crude Oil:

Is crude oil a place to have money? Yes. Is it going to be much higher in the next decade? Yes.

Other Buys

• Agriculture
• Swiss franc- “I’ve been buying it”
• Taiwan- “I’ve been buying Taiwan… I’ve never bought Taiwan before.”
• Airlines- “I’ve been buying airlines… I own those, and periodically I buy them when they go down. I think my big play will be later. But I did pick up some last week, as a matter of fact.”

You can listen to the GoldSeek interview here.

Source:

“The Gold and Silver Review”
GoldSeek.com, March 26, 2008

This morning I read an interview about investor Jim Rogers in the Sunday Times (UK). Niall Brady does a fantastic job getting Rogers to talk about not only his economic outlook and investment strategy, but his personal life as well. Here are some excerpts from the exchange:

TIMES: What property do you own?
ROGERS: None. I sold my home in New York when I moved to Singapore last year and, for now, I’m renting. I’ll probably buy when I find the right place. I’m of the view that property prices will come down in many parts of the world, including Singapore, so I’m not in a hurry. I don’t like property as an investment – it’s too illiquid and sometimes you can’t sell it at any price.

TIMES: Where are you investing these days?
ROGERS: I expect the bull market in commodities to run until at least 2020. I’m buying cotton, sugar, coffee and precious metals such as silver and palladium, because their prices haven’t moved as much as other commodities. The Chinese renminbi is one of the best investments I know. I’m also buying the Japanese yen and the Swiss franc because these currencies have to appreciate in value. I expect to get out of all of my American assets before the end of the year as I believe the dollar will remain under serious attack. I’m short-selling US investment banks. All the great excesses of the past 10 years have been in financial services.

TIMES: Do you invest in shares?
ROGERS: I still buy shares periodically – I’ve owned some for more than 30 years – but I’m not optimistic about stock markets. I prefer commodities and currencies. I recently bought an exchange-traded fund on the Taiwanese stock market, though. It has traded at a big discount because of the constant threat of war with China. Now it looks like peace for the first time in 60 years.

Rogers also noted that moving to Asia was his “best investment.” He said:

Ensuring my daughter grows up speaking Chinese – it’s the main reason I moved to Asia. Asia is the future. America and Europe are the past.

Source:

“Fame and fortune: Jim Beeland Rogers”
Niall Brady
Sunday Times (UK), March 23, 2008