Through the Lens of an EM Legend

Published on
October 2nd, 2019
Duration
62 minutes


Through the Lens of an EM Legend

The Interview ·
Featuring Mark Mobius

Published on: October 2nd, 2019 • Duration: 62 minutes

Legendary emerging markets investor Mark Mobius, founder of Mobius Capital Partners, sits down with Roger Hirst to articulate his contrarian venture into active management while providing a unique perspective on recent developments in China and Hong Kong. Mobius illustrates how central banks have altered the global investment landscape, highlights risks with both the U.S. Dollar and the Chinese Renminbi, and reveals where he sees opportunity for growth. He also talks about the evolution of ESG investing, and explains how investing in firms based on healthy environmental, social and corporate governance actually produces better returns. Filmed on September 25, 2019 in London.

Comments

Transcript

  • FR
    Frank R.
    18 October 2019 @ 01:11
    Is Mark really convinced that Health care cost is up because care is better? and that wages have kept up with the cost of living? Am I missing something? Health care cost has very little to do with the quality, I don't think it's a secret that the sector has been manipulated. You can get the same care in other countries for a fraction of the price. Second, wages have not kept up with inflation, there's just simply no way. There's a lot of data and to prove this.
  • HK
    Himali K.
    12 October 2019 @ 16:26
    I was highly impressed with Roger Hirst's questions- fantastic interviewer.
  • KA
    Kelly A.
    6 October 2019 @ 16:03
    Great comments, readers. Very helpful to me. Thank you. I'll probably skim the transcript and leave it at that. One reframing of China: why are USA tax payers paying to rescue multi-billion dollar multi-nationals? They all knew China does not follow rules of international law. I was there in 1985. Every USA company knew it then. And, those companies basically gave China access to intellectual property to get access to the markets. In my business, Uncle Sam doesn't bail me out if I make a bad judgment about a client. Why now? This whole trade war is just made up junk. Apple can afford to bail itself out. GM has been stupid for decades. We already bailed them out once. It's time to wake up.
  • PP
    Peter P.
    6 October 2019 @ 13:57
    He missed the boat on healthcare costs. There is inflation in healthcare, and there is no real additional benefit. Americans are not living any longer. He needs to recheck his figures. Otherwise, great interview and way more thoughtful than the blathering Jim Rogers one.
  • DD
    Daniel D.
    5 October 2019 @ 19:37
    A very high quality interview! Mark is very impressive on many fronts. I seriously would like to know what his fitness/dietary routine is that has allowed him to be so healthy and intellectually sharp in his 9th decade.
  • SG
    Sven G.
    5 October 2019 @ 12:36
    hope im as ambitious and switched on as Mark when I'm in my 9th decade!
  • JF
    Joseph F.
    5 October 2019 @ 03:35
    Excellent.
  • NR
    Nelson R.
    5 October 2019 @ 03:16
    The demise of the U.S dollar at the hands of the Renminbi? Come on man, what a ridiculous statement to make. Like other empires before the U.S dollar might indeed some day loose its world reserve currency status to an alternative, but it is not going to be to the currency of a bunch of corrupt chain smoking communists in China. It is not oil fucking trading what gives the Dollar it’s status, it is the rule of law, the respect for private property, free markets, freedom of speech, freedom or religion, political freedom, the respect for human rights and an independent (for now) central bank what does. These things red china cannot deliver in a million years, no matter how much they strong-arm people into taking their toilet paper currency.
  • JE
    Jos E.
    4 October 2019 @ 09:15
    Generic
  • VS
    Victor S. | Contributor
    3 October 2019 @ 16:40
    I have respect for Mr Mobius BUT when asked the question of putting down Hong Kong protesters and his response was “they (China) has to be cautious “ ... really!!! Anyone can say that ? Will they or won’t they use the PLA and kill people ? That is the question. Its yes no or you have no idea. This is a professional answer. Sounds like Mitch McConnell >
  • VM
    Vincent M.
    3 October 2019 @ 02:44
    Lost me when he said China economy is stable.. how can you know when they hide the reality through propaganda.
  • OC
    O C.
    3 October 2019 @ 01:45
    Hello. The CC is off at the 9:34 mark. The CC shows Roger talking but Mark is still talking. If one opens up the transcript and tries to use it to follow the conversation, one realizes that the segment where Roger talks after Mark is skipped. To follow the transcript from 9:34, skip to the part where Mark starts talking about 1987. Real Vision, please fix the CC. Thank you.
  • RI
    R I.
    2 October 2019 @ 21:29
    Roger is a great interviewer.
    • DR
      David R.
      2 October 2019 @ 23:38
      Then, maybe subscribe to ThinkTank where he makes 2 major contributions at least twice every week.
  • dp
    david p.
    2 October 2019 @ 21:14
    Fukushima.... they never talk about it any more
  • FA
    Frank A.
    2 October 2019 @ 17:53
    I thought it was good up until near the end when he said all these problems could be solved by printing money. Which is factually incorrect as all it does is create different problems and maybe more severe problems (such as total global poverty) with a few like him only losing a little but everyone else eating crackers. That kind of thinking is what has lead us to our current bankrupt and cornered position........
    • DS
      David S.
      2 October 2019 @ 20:31
      He gave you the consequence which you will not like - rapid inflation. His 10% gold position is a hedge plus equities with strong balance sheets and return on assets will recover over time. DLS
    • DR
      David R.
      3 October 2019 @ 01:34
      Amen to you, Frank and David. Also commodities do well in that inflationary environment, historically. What about real estate? It's a real asset, which should do well with inflation, being a real asset, but if interest rates rise too, that might take a bite out of real estate?
  • JS
    Jason S.
    2 October 2019 @ 17:33
    Roger is definitely one of the best interviewers I have ever seen! Nice one.
  • TD
    Thomas D.
    2 October 2019 @ 17:24
    Continuous currency devaluations and low interest rates hasn’t worked too well for the Japanese investor over the last 30 years....
    • DS
      David S.
      2 October 2019 @ 20:33
      Their GDP remained constant by government expenditures. This has given corporations time to recover from bad borrowing policies. DLS
  • FF
    Farouk F.
    2 October 2019 @ 15:51
    I really hate this guys intros. Talks way too much.
  • PP
    P P.
    2 October 2019 @ 14:48
    Mark Mobius is a marketing genius, his investing track record though is not something to write about.
  • SB
    Stephen B.
    2 October 2019 @ 13:38
    I don't buy into the theory that all EM's (and therefore China) need is a market economy. The basis of western prosperity is property rights, the rule of law AND democracy. Democracy is a vital component as it is provides stability over decades. Think how many changes of Government we have seen in the US or UK over the decades. China has been able to avoid that fundamental truth, temporarily, by delivering ~10% growth rates. Any hick-up in the growth story (like is unfolding now) and the stresses will materialize. And it will come from multiple directions: from students that cannot find a job; entropreneurs frustrated with CCP corruption; the middle class upset that there house price is dropping; and the daddy of them all - regional tensions. A western democracy can survive such stresses and survive over decades or century's. China is not.
    • SP
      Sat P.
      2 October 2019 @ 18:13
      Agreed. However, Western democracies are well into their downward spiral as they have become more authoritarian. The UK Government is a prime example,. They shut down free speech, through pressuring US tech companies to shut down accounts and YouTube channels of people they don't like, working with ISPs to block free speech website domains, also ignoring the vote on Brexit. The US is in a similar situation, Australian ISPs are blocking sites like Bitchute, they blocked Zerohedge during the NZ shootings (even though it is a financial news website!)
    • DR
      David R.
      3 October 2019 @ 00:41
      Disagree strongly. Every democracy today is closing in on failed state status. One vote per person leads to the lowest common denominator, massive overspending & bankruptcy, as politicians up the ante offering more & more free stuff to get elected. Just watch President-elect Elizabeth Warren in 13 months. In contrast, countries today like Singapore and Monaco, which are small authoritarian states, have become some of the most successful countries ever. A benign dictatorship is for the best, like a good daddy or mommy, as most people are too uninformed or dumb to know what's good for them, like children. OTOH, democracy might function well if it were organized like a corporation, in which votes were dependent on how much tax you paid. No vote for those who pay no income tax and for those in the public sector, which is a consumer of national wealth rather than a producer.
    • DR
      David R.
      3 October 2019 @ 01:04
      Addendum... I strongly agree with you Stephen about the importance of property rights no matter what the government structure. And the strongest property rights and least corruption is in uniparty, authoritarian Singapore. So democracy isn't a prerequisite for those.
    • RH
      Rob H.
      3 October 2019 @ 03:19
      Agreed.
    • SB
      Stephen B.
      3 October 2019 @ 04:08
      OK, i accept that Singapore and Monaco work as benign dictatorships but they are small and untypical. The CCP is very, very far from being benign. We have 1989 to remind us of that.
  • TS
    Taranvir S.
    2 October 2019 @ 13:13
    If the Chinese system doesn't sit well with the Western establishment of democratic society, will we see two different systems flourish in their own ways over the long run or will one eventually have to lose out? Interested to hear the opinions from other RV watchers!
    • SB
      Stephen B.
      2 October 2019 @ 15:53
      As per my comment above, i believe there is only one, sustainable formula.
    • EK
      Edward K.
      2 October 2019 @ 18:01
      China has been massively subsidized by Western (primarily Wall St) greed and Washington blindness. Their outright theft of IP and counterfeiting has been silently ignored for decades. So what in fact is their system? Do you want Huawei and CCP collaboration determining your quality of life? Am concerned that China has already "won" the ideological economic system battle; we just have not factored it in or paid the full price yet. .
    • WC
      Wilson C.
      3 October 2019 @ 12:57
      those of the opinion China is an IP thief (forever and ever) should read up on the rise of Japan and Korea, even back to the colonial days of USA and UK (and the case of Samuel Slater with stealing UK's textile tech). IMHO, key inflection point is whether a country can mature from a copy-cat phase to innovation, and re: China I'll recommend to read Kai-Fu Lee's AI Super-powers (he's a taiwanese-born American). It would give a different perspective (that is obvious to those who are frequent travelers to China).
  • SW
    Scott W.
    2 October 2019 @ 12:57
    Regarding US healthcare, it's perhaps better not to describe costs in terms of inflation/disinflation but rather via an acknowledgment that the pricing mechanism is broken. There are certainly capabilities now that didn't exist previously and that makes it more difficult to assess cost in aggregate. However, when the office manger for your local family doctor cannot answer the question "how much would you charge to see Dr. Mark for 5 minutes assuming no additional tests or diagnostics - i.e. how much is a unit of his TIME priced" - and when one sees repeatedly that process X is billed to insurance at (for instance) $280 with a $75 copay but oh, you don't have insurance... that's $70 cash - one must conclude things are WAY jacked.
  • wj
    wiktor j.
    2 October 2019 @ 10:40
    China money is funny money. Even Russia exchanges the funny money to dollars as soon as they get it. All those trade deals china does is done officially with funny money but is exchanged to dollars asap. Chinas funny money will never be a reserve. 2 things he forgot to mention is money flow controls. And dollar debt. Good luck with investing in China. I heard rumors that China even doesn’t pay out pensions in some smaller cities.
    • SB
      Stephen B.
      2 October 2019 @ 15:09
      Getting your money in is one thing. Getting it out is quite something else. I bought two apartments in Brazil two decades ago. A great investment in theory (20×returns) but I cannot even get the rental income repatriated, let alone the capital. In theory Brazil (like China) is open. In practice, only the well connected get their money out through the banking system.
    • PF
      P F.
      2 October 2019 @ 18:25
      Stephen, Bitcoin works quite well for remittences out of Brazil. You shouldn't have a problem opening an account with an exchange as long as your personal or company documents are in order.
    • GD
      Giovanni D.
      3 October 2019 @ 00:43
      Stephen, don’t know which bank you’re trying to use to repatriate your money out of Brazil, but I’ve sold 3 properties here and moved the capital out with no problems at all. My bank is Bradesco Prime (they bought HSBC in Brazil) and they’re used to moving money in and out. Heard that state banks are not so used to doing it, like Caixa and Banco do Brasil. Banco rendimento is also very used to moving money in and out and have competitive rates/fees. Check Bradesco Prime and banco rendimento out... Don’t know if you’re still trying to move the money out, but these days all you have to do is give their exchange desk a call (they have an English hotline), get the USDs and sign an exchange contract if it’s over 10k USD, (below that it’s all done online these days) and now you can even sign that contract over 10k online too (before you’d have to show up at branch 🤦‍♂️!). Fist time you move some money out, they’ll make you sign some KYC papers (think you can send those online too, but I did it in a branch) and you’ll have to answer a few questions on the phone... but after that, it’s very straightforward and you don’t get asked those questions again and again. As long as you’re tax returns are fine and you can prove the source of the money, you’re fine. I get paid by an US corp here and then move some of that money out, almost every month. I have no problems at all doing that, besides the horrible conversion rates offered by the banks. My only pet peeve is the horrible rates offered by Bradesco Prime (rendimento offers much better rates) and the time I have to haggle on the phone to get a better rate every time I’m moving a sizable amount... besides that, it’s all good, if you’re patient... as it takes about a week sometimes to get the money in your bank account overseas... Also, you could use transferwise, for your rental income. Hope that helps somehow! 👍 cheers!
    • DR
      David R.
      3 October 2019 @ 00:57
      In fact, Russia sold dollars and bought gold in recent years. Same for China. Smart moves! And Russia now sells its oil & gas almost entirely in Yuan and Euros now. The two biggest energy deals in human history, between Russia and China a few years ago, and between Iran and China last month, both explicity exclude dollars. Russia also sells its nat gas and oil to Europe for Euros and not dollars. This means that as of Sept 30, 2019, most of the global oil trade is suddenly non-dollar. The petrodollar is almost dead. Thanks to the massive energy deal with Iran last month, China now buys the majority of its oil in Yuan or via the petroyuan on the gold-backed Shanghai exchange. Russia sells relatively little using dollars. Even Saudi will be selling in non-dollars. So the petrodollar seems to be an endangered species. Interesting.
    • DS
      David S.
      3 October 2019 @ 20:03
      Russia converts to gold as much as possible. Many countries worry about the US weaponizing the dollar after Iran. DLS
  • LS
    Leigh S.
    2 October 2019 @ 09:49
    Well managed Roger keep the conversation going and clearly Mark respected your points and questions.