I’ve talked about legendary investor Jim Rogers a lot in these pages. Recently, I sat down with Jim for an exclusive one-on-one interview. I’ve already shared the one thing he says you need to be successful and his advice for protecting yourself from the major threat to global markets.
Q4 hedge fund letters, conference, scoops etc
Today, I’m sharing what Jim told me about how he finds investment opportunities… and what he thinks are the most compelling opportunities in markets today.
(Jim’s investment style and approach is unique and impossible to copy. I do my best, though, with International Capitalist… I travel to off-the-radar destinations – with big upside – around the globe. Find out more here.)
How Jim Rogers finds investment opportunities
Kim: What are the two or three things that make you take notice of an investment opportunity – anything from valuations, underperformance or bad headlines?
Jim: Well, a disaster. And listen, disasters like Venezuela don’t come along every year. Those are few and far between. Disasters like North Korea don’t come along very often.
North Korea has been a disaster for 80 years, more. But now, it’s coming to fruition.
If you find one of these things, just be attentive. Venezuela’s been in decline for 25 years now, but now is the time to do something. Americans are under sanctions, we cannot do much in Venezuela, but other people can.
When you see things like that, you don’t have to ring the bell. The horrible 25 years in Venezuela is coming to a climax. North Korea, the terrible 80 years is coming to a climax. These things eventually end, but as I said, they don’t happen every year. You just have to be attentive and be alert when they happen.
The most exciting opportunities right now
Kim: So what countries, markets or sectors right now jump out at you?
Jim: Well, Korea is going to be the most exciting country in the world soon. Unified Korea has 80 million people on the Chinese border. It has lots of natural resources, cheap labour, disciplined labour, in the North. No debt in the North, with educated labour and resources. And in the South, they have lots of capital and expertise on the Chinese border.
[Regarding the unification of North Korea and South Korea] China’s for it, Russia’s for it, South Korea’s for it, North Korea’s for it, it’s going to happen.
The American military doesn’t want it to happen because it’s the only place that America can have soldiers on the Chinese border and the Russian border on the eastern borders. So they don’t want it to happen.
The Japanese are against it because they cannot compete with a unified Korea, and they know it. They have a declining population, gigantic debt, many other problems. They’re trying to stop it, there’s not much they can do.
[Japanese Prime Minister Shinzo] Abe talks about, 40 years ago, the North Koreans kidnapped 13 Japanese citizens. That’s all he can bring up. He cannot say, “We don’t want it because we cannot compete. We don’t want a new competitor.” So it’s going to happen one way or the other. It’s going to happen fairly soon.
Korea will be exciting, it’ll be less badly hurting than everybody else because you’ve got this virgin territory in the north, it’s very cheap and no debt.
Other places, I mean, Venezuela is a disaster, not going to get much worse. Everybody in Venezuela now knows, even the guy in charge knows something’s got to change because it’s a disaster.
I don’t have any investments in Venezuela. I’m a citizen of the land of the free [the United States]. We’re not allowed to do things that other countries can. Other people can invest in Venezuela, but not Americans right now.
But if you can invest in Venezuela now, coming out the other side, you’re going to make a fortune because it’s a disaster. The whole thing is a total unmitigated disaster. But places like that, you can invest now and you do fine on the other side.
Agriculture’s like that. Not as bad as Venezuela, not as bad as North Korea. But there are many good things happening to change agriculture, conceivably Turkey. I have not done anything in Turkey for a variety of reasons. But there are some places where changes are taking place. Russia. I do have investments in Russia. So there are places.
Good investing,
Kim Iskyan
Publisher, Stansberry Pacific Research
P.S. Finding disasters that could be great investing opportunities is exactly what I do in International Capitalist. I focus on out-of-favour stocks in out-of-favour markets (including Russia, for example)… or else places that you’d just never think of looking at. And the returns in those places can be extraordinary. You can learn more here.
Article by Stansberry Pacific Research
