When asked about the state of global markets, he starts with a well-known quote from a friend: “Remember what Warren Buffett said: ‘It’s only when the tide goes out we find out who’s swimming naked.’
“In a world not driven by economics, who knows whether stock A should be trading at $100 or $50 and, more importantly, how much intellectual energy investors are prepared to spend on such decisions and how much second guessing they are willing to accept.”“First, I have made a career of investing in things that were described as uninvestable, starting with B-rated bonds in 1978, and distressed debt in 1988, and emerging market equities in 1990,” he says.“All of which were on the no-fly list.
“People call it uninvestable. There’s no doubt about that, but let me make it clear: you don’t buy anything on an uninvestable pile just because it’s there. But this is where you look. The things everybody loves will never be cheap. It’s an oxymoron to say I found a bargain among the pile of things everybody loves.
“I think it’s one of the wonders of the world – the fact that you have the institutions, and that it is mandatory,” he says.This prompts Marks to recall a memo he wrote in August 2008 about the decline in financial security of the typical American worker. “We have a lot of good clientele in Chile, and in my opinion Chile has been the greatest economy structure in Latin America – and that’s partly because it was established by a bunch of University of Chicago economists in the mid-20th century,” he says.
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