Given how much Jim Rogers has traveled around the world, this book really tells how much he has learned during his lifetime. This book is really well written in the form of stories and strives to pass on some of the most noteworthy insights that he has assimilated during his life. You can tell that he really has the best of intentions and if you read between the lines, this books is really intended to be read by his children.
- The portrait of the investor as a young man
- Innocent abroad
- On my own
- Beating the bear market
- Investment biker
- The rise of commodities
- Home on the hudson
- The largest debtor nation in history
- “Capitalism without bankruptcy is like Christianity without hell”
- Journey to the east
- Nation of immigrants
- Land of the free?
- Crisis in paper money
- No one has ever repealed the laws of supply and demand
- The sun is rising in the east
- Creative destruction
The portrait of the investor as a young man
If history affirms anything, it is the proposition put forth by the Greeks that “nothing endures but change.”
Only two things are infinite: the universe and human stupidity. And I’m not so sure about the former.
– Albert Einstein
- Study as much as necessary to understand a subject and even go a little beyond to make sure you really understand it. Don’t go by external metrics. Only stop after you really understood the subject.
Persistence is what makes the difference.
Reading suggestion: The Pickwick Papers by Dickens
Rogers knew exactly what he wanted to do after attending Oxford.
Even though he knew nothing of stocks or bonds, he went working for an investment firm.
A senior partner at the investment firm advised him not to attend a business school because they will teach him nothing useful. Rather he should learn by doing.
All of a sudden my studies of history and current events were more than theoretical exercises—they had practical value.
But empires always overreach. They always overspend. And by 1918, the British Empire was already corroding from within.
In 1976 Britain was unable to sell government bonds.
He has the tendency to right to early in his assessments.
When I arrived at Oxford in 1964, London’s financial district, the City of London, was all but ignored. The best and the brightest students at Balliol were seeking careers in government service and academia. A job in the City was for the idiot sons.
- Earning a business degree over the next decades is a waste of money as the market is so saturated. It is better to go into agriculture or mining as one’s profession.
Until prices reach a point where growing food is profitable, the world’s farmers, who are currently aging and dying, are not going to be replaced.
- You should know yourself and start to think on a deeper level to understand the truth. To do this, you should study philosophy and history.
So many people today are caught up in conventional thinking because it is easier and safer to echo perceived wisdom, to echo the opinion of the majority, with one’s intellectual processes circumscribed by such concepts as the state, culture, or religion.
- Typically, the conventional wisdom that existed at the start of a decade was / will be replaced in the following decade.
On my own
Persistence and perseverance are absolutely essential to survival, but just as important is judgment.
When he started on Wall Street, very few people were interested in the profession or stocks.
At his first hedge fund, they invested in markets were nobody did.
Soros was good at timing the market, Rogers was good at doing the research at their hedge fund.
[..] the advice I will give my children, is this: before asking how much you are going to get paid for a job, first decide whether it is the right job, whether it is the right place for you, because if it is the right place and you do the job right, the money will come. The money will find you, I assure you. The money should be the least of your questions.
Luck favors only the mind that is prepared.
– Louis Pasteur
Beating the bear market
- Even Napoleon declared short selling as an act of treason.
Short selling is in fact indispensable to the market. It adds liquidity as well as stability.
Markets can remain irrational longer than you can remain solvent.
– John Maynard Keynes
Don’t diversify if you want to make a lot of money.
Read Extraordinary Popular Delusions and the Madness of Crowds by Charles Mackay
Learning by doing is the best thing to do. On-the-job training is key.
Every man is the architect of his own fortune.
– Appius Claudius
- He counts himself lucky to have found a profession which he has a passion for.
In America, if you go broke, you can write off just about everything—everything but loans you received for your education, the very debt that probably launched you on the trajectory to bankruptcy in the first place.
- Shows with Jim Rogers:
- The profit motive with Jim Rogers
- My Portfolio (with Bill Griffeth)
The rise of commodities
- Trading commodities is easy as it’s less influenced by politics. You only have to look and supply and demand to figure out the direction of price.
It is a time-honored principle—but most people, for some reason, seem not to be aware of it—that whenever the market knows that somebody is coming, the market rises accordingly. Markets are very smart; they always run ahead. So gold, over the next several months, went down to $100 an ounce, losing 50 percent of its value, and we realized substantial gains.
Home on the hudson
- If you speak a language well, even if you are a convicted felon. You may have more perceived status by standing next to a PhD or multi-millionaire if you can articulate yourself better.
The largest debtor nation in history
[..] when you fly into a New York airport, you are flying into a third world airport.
- Asia has a certain vibe to it that New York doesn’t have anymore.
Incompetence is something you can always count on from politicians and bureaucrats.
“Capitalism without bankruptcy is like Christianity without hell”
- Sweden had a real estate bubble in the 1990s and collapsed. The government bailed out nobody and the system is now sounder than ever.
Capital is agnostic. That is one of the truisms of the system under which we live. All capital cares about are security and getting the best return.
Capitalism without bankruptcy is like Christianity without hell.
– Frank Borman (astronaut and former CEO of Eastern Airlines)
Journey to the east
America’s health care is one of the worst considering its costs. Rogers rather goes to Singapore to be treated there as it has one of the best systems in the world.
He experienced first hand how worry and anxiety ages the body during a long law suit.
In Singapore people are required to invest part of their income. They can choose from a small set of recipients.
America is not competitive, and you can trace it back to attitudes in homes and in schools.
Rags to riches then back to rags. A member of the family strikes it rich, and the person’s grandchildren, maybe the great-grandchildren, wind up back on the dole.
Singapore also has an aging population with a shrinking birth rate.
Throughout history, countries and cities with open borders where the magnets of big economic success. For example, Samarkand along the Silk Road or Córdoba in Spain.
Deng Xiaoping said that if you open a window some flies will come in, but doing so is part of admitting sunshine and fresh air.
Recommended to read by Rogers: A Modest Proposal by Jonathan Swift
Nation of immigrants
We are now a country where the primacy of the individual is subordinated to the prerogatives of the state.
- The USA imposes taxes based on citizenship instead of residency.
The Smoot-Hawley Tariff enacted in 1930 and the subsequent retaliatory tariffs leveled by US trading partners turned what would have been a worse-than-normal recession into the Great Depression.
- If you put exchange controls on imported goods to elevate local production, you are reducing competition and inadvertently obstruct innovation in the future as people become complacent. As a result, the whole economy suffers.
Land of the free?
- In 1994, America welcomed the devaluation of the Reminbi, today they are in furor that it even happened.
They [politicians and bureaucrats] speak out of both sides of their mouths, often at the same time, and will say whatever is most politically expedient at the moment.
Crisis in paper money
In the 1930s, Britain made it an act of treason to user another currency/form of money other than the pound sterling.
Typically politicians don’t have the guts to do what’s necessary to achieve long term prosperity. They generally think of short term gains without looking at the big picture. Also, they tend to favor big banks and the likes instead of the working class.
No one has ever repealed the laws of supply and demand
- Putting regulations into place to outmaneuver the marketplace generally does not work. There are instances in history where politicians simply did the wrong thing like in the Philipines on rice and the subsequent surge of prices.
The Tiananmen Square protests in Beijing in the spring of 1989 started out as protests against inflation and rising prices. Not until the Western press showed up did students start shouting words like “democracy”.
That some should be rich shows that others may become rich, and hence is just encouragement to industry and enterprise. Let not him who is houseless pull down the house of another; but let him labor diligently and build one for himself, thus by example assuring that his own shall be safe from violence built.
– Abraham Lincoln
Plato was of the opinion that societies morph from dictatorships to oligarchies to democracies to chaos and back to the start.
Today, China is a capitalist country - more so than California or Massachusetts.
The sun is rising in the east
Read Adventure Capitalist by Jim Rogers.
The old order changeth, yielding place to new, / And God fulfils himself in many ways, / Lest one good custom should corrupt the world.
– King Arthur
- People change when to become elected to office in Washington.
[..] money is the lance, not the grail.