Review of Jim Rogers' Investment Autobiography, Street Smarts

credit: sg.asiatatler.com

Famed investor Jim Rogers has published a book that is part autobiography, part geopolitics, and part investment wisdom. Street Smarts: Adventures on the Road and in the Markets (Crown Publishing, 2013) gives his views on investing, which countries are growing more powerful and which are declining, what America must do to reform its society, and the value of raising children. Despite its wide scope, the book does not meander. Rogers engaged me throughout with his ideas about television (like me, he avoids it), politicians, ethics, and what it takes to succeed.

As an autobiography, the book reveals that Rogers single mindedly tried to understand how markets worked and struggled without pause to do so. He enjoyed learning how the world works, so he was motivated to understand markets as well as wanting not to lose money. He worked on holidays and through weekends. He had few distractions as none of his earlier marriages lasted long or produced children. The picture on the left shows Rogers with his third wife, Paige. He now has two Mandarin-speaking daughters as well. Rogers insists that he was successful because of his ability to think independently and willingness to travel and look at  information sources himself.

The two main themes of the book are the transition to Asia as the economic powerhouse as American leadership declines and "a cyclical shift away from financial firms as a source of prosperity" (P. 5) in favor of producers of real goods, especially foodstuffs. (As an aside, brick and mortar education may be replaced by distance learning, and Rogers predicts many of today's elite universities will go bankrupt.)

Rogers states that the United States needs to do five things to be saved: change the tax system, change the education system, institute health-care and litigation reform, and bring the troops home" (P. 241), but he is doubtful that these reforms will occur because of the power of special interests. He suggests that the legislative branch  no longer meet in Washington, D.C., and instead the representatives and senators should in their local areas and meet virtually, avoiding the power of the special interest groups.

Since Rogers conducts his business dealings ethically and believes his good name is invaluable, I found it interesting that he glosses over human rights violations in many of the leading Asian countries, comparing these problems to those in early America:  lack of real democracy in the early years of the American Republic and the existence of a late 19th-century plutocracy. In other words, according to Rogers the United States committed many of the same sins now found in Asia. I find this comparison unfair as our government has committed crimes of omission (because the Constitution limits its powers) rather than commission, such as throwing people in prison because of their beliefs. Rogers' unwillingness to come to terms with Asian oppression is the weakness of this book. He feels that China, Myanmar, and North Korea will eventually change for the better. So invest today! Despite this flaw, the book is well worth reading.

I have previously recommended Rogers' Investment Biker book to my economics students and will add this book to my list of recommended books as well.

See my previous blogs about North Korea here and food prices here and here.

If I Was A North Korean

Starving children, North Korea

North Korea is back in the news after the death of its fat and evil dictator with the bizarre hair-do, Kim Jong-il, replaced by his equally out of shape and militaristic son. The world again tries to understand one of the most repressive places on earth. The simplest measure of whether the leadership of a country allows its citizenry to flourish is whether people are trying to get in or trying to get out. Few people try to smuggle themselves into North Korea, Syria, Gaza, Somalia, Cuba, Iran, Zimbabwe, or other assorted hell holes, unless they're trying to help the oppressed and starving people in these places. The United States and North America, Western and Central Europe, Israel, and Australia, by contrast, attempt to keep immigrants out. People want to move and live in these prosperous and free places. I count my blessings. The fortunate circumstance of having American citizenship has given me an incredible number of advantages over most of the seven billion people of this world. For example, let's compare some mundane aspects my life to that of the average North Korean.

I eat three or more meals each day. I have to exercise and watch that I don't gain too many calories. The average North Korean ate tree bark during the last famine, and one third of the population is in danger of starving to death. The United States will withdraw food aid after North Korea's attempted rocket launch, so I am not guilty of hyperbole, unfortunately. (Note--Bloomberg states, "As many as 1 million people starved to death during the 1990s, according to estimates from Marcus Noland and Stephan Haggard of the Peterson Institute for International Economics in Washington D.C.)

My life expectancy is greater than that of my parents. The life expectancy in North Korea has decreased during Kim Jong-il's iron-fisted rule.

As a citizen in a federal republic, I have some say over leadership. I'm sad when my party loses in an election. In North Korea you better look sad when one of the obese dictators dies after eating too much breakfast. (Hey, my theory is as good as any. See the link.) Any regime that photoshops pictures of State funerals is not to be trusted with telling the truth.

I enjoy freedom of speech--lots of blogging!
In North Korea there is no freedom and little speech--lots of flogging!

I can drive to Arizona and visit family and take a vacation. Refreshed, I return to the Bay Area.
In North Korea the state will pay for a one way trip to the local prison camp. Dead victims return to the earth in a box.

I turn off the computer when I go to bed.
In North Korea the state turns off the electricity way before bedtime. 

I enjoy California exports of almonds and nuts.
North Korean dictators enjoy exports of arms and nukes.

My kids get a free education.
North Korean kids get a free indoctrination.

America destroys her rockets on the ground--nuclear disarmament
North Korea's rockets blow up after launch--attempted nuclear proliferation.

And on it goes...See the United States' responses to the North Korean leadership succession crisis here and rocketry and nuclear proliferation here.