Adventure Capitalist

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It's
been nearly a decade since we've been able to live vicariously through
the globetrotting exploits of master investor Jim Rogers. In the
early 1990's, Rogers hit the road, crossing the globe by motorcycle,
and chronicled the adventure in his 1994 book, Investment
Biker
.

This
time, Rogers uses a car to make the trip, primarily at the urging
of his wife Paige Parker, and the journey covers 152,000 miles,
through 116 countries, taking three years to complete. Adventure
Capitalist
tells the story of their drive around the world
and then some.

Weaving
a story that combines travelogue with a love story, investment advice,
history, geography, economics and world politics is no easy task.
But, Rogers succeeds as he had in the investment world. From humble
beginnings growing up in Demopolis, Alabama, Rogers eventually co-founded
the Quantum Fund, a global investment partnership. Ten years later,
the portfolio had grown 4,000 per cent and Rogers decided to retire
at the ripe old age of 37.

For
those of us who missed out on the opportunity to invest in the Quantum
Fund, at least we have Rogers to provide us with another great story
and plenty of good insights. What is a recurring theme throughout
the book is the anxiety and trepidation that Rogers feels whenever
he and Parker are approaching a border to cross. He never knows
what to expect. No matter that he has the proper paperwork in hand
and the assurances of any number of diplomats – crossing any border
was an adventure and often times an aggravation that lasted for
days.

For
those who go ballistic maneuvering through airport security in the
United States, the nonsense that Rogers continually endured just
to cross lines created arbitrarily by some government will astound
you. And when Rogers crossed the border from India to Myanmar (formerly
Burma) the tale of the crossing reads like an Abbot and Costello
routine.

Rogers
and his wife had left India's State of Manipur and were safely across
the border in Myanmar. But wait, here comes an Indian official running
after them, who says that they can't leave, because, they didn't
have permission to be in Manipur. "He was telling us – I am not
making this up – that we had to return to Manipur, because we were
not allowed to be in Manipur, and thus we could not leave
it," Rogers relates. The debate lasted for two hours before,
"someone made a phone call and took the subinspector off the
hook, and we were free to proceed."

Rogers
constantly makes the point that the more bureaucratic red tape that
a country imposes, the harder it will be for that country to attract
capital, the worse off it's citizens are and investors should look
for opportunities elsewhere. The question is: are there more investment
opportunities overseas now, than there was when Rogers took his
last trip? Unfortunately no, as Rogers writes, "When I returned
home, I realized I had closed as many [brokerage] accounts on this
trip as I had opened, in contrast to my previous trip, when I had
opened several and closed none."

But,
don't think all is well for investors in America. Both on the foreign
and domestic policy fronts, politicians in the US are doing what
they do best – making a mess of things. As Rogers notes, "The
low opinion they [public servants] enjoy is well deserved."
But, are politicians made or born? Rogers answers with, "Studies
have shown that the people who in grammar school excelled at recess
are the ones who wind up in politics and usually do well at it."

These
same politicians have constantly preached to us since 9-11-01 that
people around the world hate us because we are rich or that they
hate us for our freedom. Rogers says both views are bunk. They encountered
"virtually no anti-American sentiment on the ground."
Foreigners are not angry with the American people, but they are
angry about our government's foreign policies.

Of
course one of those foreign policies is for American politicians
to send millions of taxpayer dollars to nongovernmental organizations
(NGOs) around the world. These NGOs are made up of consultants and
middlemen who soak up the aid money long before it might reach hungry
orphans. Thanks to American taxpayers, according to Rogers “[t]here
are Mercedes dealers in places where there are not even roads.”

When
Rogers and Parker returned home, they were very surprised at how
much prices have increased for goods and services while they had
been away. Of course according to government statistics, prices
are stable, there's even talk of deflation. Rogers takes issue with
the government's official numbers, citing "hedonic adjustments"
as a way the government lowers CPI increases, to help balance the
budget.

Rogers is no fan of Federal Reserve Chairman Alan Greenspan, pointing
out that, "Greenspan has a long, long history of failure. That
is why he has a government job. He has never been very successful."
In fact, Roger is no fan of central banks. He reminds us that it
is a very recent phenomenon that central bankers are viewed in such
high esteem, and that this will not last. The first two central
banks in the United States failed, and "[t]his one will undoubtedly
fail, too."

Since
Greenspan "will print money until the world runs out of trees,"
where does Rogers suggest we put our money? He doesn't say specifically.
He tells us to sell US dollars and buy commodities. But doesn't
say which ones. And, Rogers seems to have gone out of his way not
to mention gold. The only reference being that "there has been
no independent, external audit of the gold in Fort Knox for several
decades, which the U.S. government refuses to explain despite repeated
inquiries."

As
exhilarating as Adventure Capitalist is too read, the book
has yet another story line that is very sad. Early in the book,
Rogers indicates that his father, Jim Rogers, Sr. has been diagnosed
with terminal cancer. Jim constantly calls home to check on his
dad's condition. Jim Sr. battles his disease bravely and even joins
his son in Siberia as well as serving as best man at Jim and Paige's
wedding in England. Jim Sr. was always in the back of my mind as
I read the book. I kept hoping that he would make it, that there
would be a happy ending. Unfortunately, he didn't, dieing while
Jim and Paige were in New Zealand on the final leg of their trip.

In
Adventure Capitalist, Jim Rogers gives us a view of the world
from the ground up. He claims no political ideology, but his message
is clearly libertarian. He is constantly amazed at the ingenuity
and resourcefulness of human beings, while at the same time being
constantly amazed and frustrated at the stupidity of government
bureaucrats, dictators and politicians. War, government bureaucracy
and central banking make countries and their citizens poorer, while
individual achievement, strong work ethic and capitalism create
prosperity. Governments and borders are always in flux, but free
market principles never change.

June
2, 2003

Doug
French [send him mail]
is a banker in Henderson, Nevada.


     

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