"I'd say 80% of my activity is engaged in the interpretation of social mood." - Hugh Hendry.
That quote taken from this September 2010 BBC Hardtalk interview with Hugh Hendry. When asked about the need for regulatory control of financial markets and curtailing of risk, Hugh replies, "The best form of regulation is, 'If you mess things up, you fail.'". Hat tip: Kevin Kaiser at Hedgeye.
Russia Forum 2011, which recently took place in Moscow, featured a global investing outlook panel discussion which included famed investors and commentators, Nassim Taleb, Marc Faber, and Hugh Hendry.
Also on hand at the forum were economist, Nouriel Roubini, strategist, Russell Napier, and a panoply of international investors and business leaders. You'll find Roubini and Napier adding their thoughts in the outlook panel video above.
There was also a rather interesting panel, featuring Faber and Taleb, entitled, "Is Russia the Best or Worst in BRIC?".
As you'll surmise from the title, it's a panel debate on the strengths and weaknesses of each of the large BRIC (Brazil, Russia, India, and China) nations, with added focus on host country, Russia. So is there a strong case for investment in Russia at this time?
This conversation is worthwhile not only for the contributions from the aforementioned panel stars, but also due to the comments from other panelists and some key questions from the audience.
Pay special attention to Mario Garnero's comments on the effects of Brazil's past inflation on its middle class (this is important for those of us in QE, deficit-land US), as well as the questions on Russia's future from the native conference attendees.
If you'd like to take a look at last year's lively panel discussion and judge the panelists' comments against what took place in 2010, check out our related post links below.
Related articles and posts:
1. The Russia Forum 2011 - Russia Forum.
2. Panel discussion from Russia Forum 2010 - Finance Trends.
Must watch video of a panel discussion with Marc Faber, Hugh Hendry, Nassim Taleb, Michael Power, and others at The Russia Forum 2010.
As moderator, Marc Faber begins the discussion by asking the panel members how they would invest $100 million for the year ahead. A varied discussion on the global economy, geopolitics, inflation vs. deflation, risk, food and energy systems, and the rise of emerging markets ensues.
Great macro discussion with seeds of investing ideas and global macro trades sprinkled throughout. Don't miss this one, and thanks to Jay at Marketfolly for highlighting this discussion.
John Mauldin highlights investor Hugh Hendry's November commentary in his latest "Outside the Box" column.
Hugh covers a lot of ground in this missive (I'm still trying to finish the letter as I write this), with comments on the great inflation-fueled rallies in commodities and stocks, the state of the global economy, the state of the Japanese, Chinese, and US economies, and more.
Here's the leadoff from Hendry's recent letter:
"This month I will attempt to answer the entrance examination for the Chinese civil service. That is to say, I will attempt to tell you everything that I know. In doing so, I will argue that this year's rally in inflationary assets, from emerging stock markets to industrial commodities to the fall in the US dollar, could be a FAKE. Let me explain why..."
Check the link above to read on for more. You can also view the November Ecletica Fund letter here on Scribd. See our related posts section for more interviews with Hugh Hendry.
Related articles and posts:
1. Hugh Hendry interview with FT.com - Investment Postcards.
2. Stocks, gold, & a legacy of debt: Hendry - CNBC.
3. Hugh Hendry on banks & govt. intervention - Finance Trends.
Here's some of the reading/viewing material currently on my radar.
We've got news of that tricky Goldman Sachs code, warnings of a commercial real estate bust, oil speculation, John Meriwether's latest fund closure, macro views on commodities and the economy from Donald Coxe, and much more.
1. Links on the recent Goldman Sachs code fiasco from Bear Mountain Bull and The Big Picture.
2. "Commercial real estate is a time bomb" - Big Picture.
3. "Whose line (of credit) is it anyway?" - Doug Wakefield and Ben Hill on abuses in government and the banking sector.
4. Weekend links from Upsidetrader, a key member of the Stocktwits trading community.
5. "Why there should be more oil speculation, not less". A viewpoint article from Time magazine of all places. I believe it was written by someone who understands the futures market, so it actually makes uncommon sense. Hat tip to Charles at Smoking Securities.
6. Some thoughts on monetizing real-time web (hat tip: Howard Lindzon) and video of the Techcrunch panel discussion with tech investors Ron Conway and John Borthwick.
7. "When it comes to liberty, there can be no balance. Liberty abides no compromise. Liberty is an absolute." -
Tom Mullen, Campaign for Liberty. This is a MUST READ piece for anyone who values liberty and personal freedom.
8. Prieur at Investment Postcards hips us to the latest Donald Coxe webcast on the markets and the economy. Very interesting comments on US stimulus packages and more.
9. Five for the Weekend. An always interesting selection of links on investing, world news, and economics from Controlled Greed.
10. "The storms that swept away Meriwether's flagship fund" - Financial Times notes that JM's relative value fund strategy relied on (now withdrawn) excess leverage to succeed, and that Meriwether was slow to cut losses, added to losing positions (shades of Bill Miller).
11. Hugh Hendry talks with FT.com about bond yields, inflation vs. deflation, and more.Enjoy the articles, videos, and webcasts we've assembled here for you. I hope they provide some helpful insights for the weeks and months ahead.
If you like what you see and would like to keep up with all our posts and news updates, you can subscribe to the Finance Trends RSS blog feed and follow us on Twitter. You're all set!
BusinessWeek points us to Hugh Hendry's recent comments on AIG and the process by which supposedly "too big to fail" financial companies have become wards of the state:"To the average U.S. taxpayer, the math may not sound right: After pumping in about $150 billion of federal money (with another $30 billion to come), American International Group posts a quarterly loss of almost $62 billion—the largest in history. And it will have access to $30 billion in new cash from Washington.
American International Group is being broken up in exchange for getting yet get another lifeline from the government. The former insurance giant posted a staggering $61.7 billion loss for the fourth quarter (about $22.95 per diluted share). Now, AIG is putting what are considered to be its most valuable insurance assets—American International Assurance (AIA) and its Asian operations—under direct government control. Once the businesses are sold, taxpayers will reap the benefits.I was struck by what Hugh Hendry, Chief Investment Officer at Eclectica, told CNBC this morning: “AIG is really no longer with us … I think the reality is (a lot of financial companies) left the business last year.”"As BusinessWeek writer Diane Brady noted in the final excerpted paragraph (above), Hugh Hendry made some interesting comments about AIG and the financial sector in his CNBC guest host appearance today. In his interview with CNBC, Hendry points out that AIG is on artificial life support from the government (read: taxpayer funds) and that many other financial companies are now in the same situation. Now that AIG is asking for (and receiving) another lifeline of funds and more lenient government bailout terms, Hugh reminds us that "AIG is no longer with us". ""We live in a very strange, twilight period where we pretend that a lot of these financial companies are still with us. I think the reality is they left the business last year," Hendry added."Hendry also notes that the stock market is viewing many of these trouble financial firms as essentially bankrupt, and that bank nationalization would provide for an "orderly liquidation" of debts from these insolvent institutions. Interestingly enough, Hugh's thoughts on this issue seem to mirror those offered today by CNBC host Rick Santelli, who also favors a sort of controlled bankruptcy-style process for these firms. At the same time, Hendry noted that the endless bailout actions and the frenzied search for solutions are a waste of time and effort. Check out his thoughts on the long transition cycles that take asset prices from overvaluation to undervaluation for more on this point.
