Last week’s issue of Business Week contains an interview article by Maria Bartiromo with global investor Jim Rogers.  The bulk of the article is on Rogers’ view of the current economic health and the fidelity of the economic policy from the Obama administration.

Reading the article, it was almost as if Rogers was reading my mind.  A few excerpts from the article, but I’d encourage you to read the entire thing here.

Bartiromo: So what should they be doing?

Jim Rogers: What would I like to see happen? I’d like to see them let these people go bankrupt, let the bankrupt go bankrupt, stop bailing them out. There are plenty of banks in America that saw this coming, that kept their powder dry and have been waiting for the opportunity to go in and take over the assets of the incompetent. Likewise, many, many homeowners didn’t go out and buy five homes with no income. Many homeowners have been waiting for this, and now all of a sudden the government is saying: “Well, too bad for you. We don’t care if you did it right or not, we’re going to bail out the 100,000 or 200,000 who did it wrong.” I mean, this is outrageous economics, and it’s terrible morality. -Source

I agree.  It’s as though in this day in age the term “bankruptcy” is a death sentence.  The fact is, bankruptcy should be looked at as a tool to restructure a company to regain a healthy business plan and achieve profitability.  The airline industry has been a friend to Chapter 11 for decades, and airlines have been healthier for it; not to say airlines are well run, just that they take advantage of a system put in place to deal with corporate shortcomings.

Rogers doesn’t stop with the financial sector, either.  He advocates his “let them go bankrupt” mindset across the board:

Bartiromo: What about Citigroup? What about the car companies?

Rogers: They should be allowed to go bankrupt. Why should American taxpayers put up billions to save a few car companies? They made the mistakes! We didn’t make the mistakes! I’m sure they’ll give them the money, but I’m telling you, it’s a mistake. It’s a horrible mistake. -Source

The real beauty of capitalism is that it allows people and businesses achieve great success, but only because it also allows them to fail.

There seems to be this wide-spread notion today that everyone deserves success, and everything should be “fair”; that there needs to be a level playing field all across the board, and no one person or entity should have an advantage over another.  If this continues, our capitalistic society will itself, fail.

Below is an interview with Jim Rogers on Glenn Beck’s radio show.  His overall outlook on the U.S. economy is pretty grim, and may even be extreme to a point, however I don’t think he’s too far off.

An especially good quote from his radio interview: “If you look to Obama and the government for investing advice, you will go bankrupt.”

Economics, Finance bankruptcy, capitalism, Economics, Jim Rogers

My good buddy MJ over at DyslexicResearch wrote a great post on buying American in a time when America needs to be bought.  I couldn’t agree with him more.

However, I’ll add a caveat to that statement.  Buy products made in the USA, but don’t buy crap just because it’s made in the USA.

We live in a global economy, and there is nothing the U.S. can do to change that, short of falling victim to isolationism.  For too long our country has depended on the buy American crowd to keep industries afloat, without concern or regard for global competition.

The American auto companies are a prime example of putting the company first and the product second.  Shoddy manufacturing, a lack of understanding for what the customer actually wants, and lack of oversight on costs result in lack of liquidity, credit, and market share.

Buy American.  Buy good, quality American products.  They exist everywhere, and MJ has a list of excellent Made in America companies.

However, don’t throw pity to those companies who make second rate products and demand that you buy from them for the sake of the country.

Patriotism and capitalism are very powerful traits that our country was built upon, but they are not interdependent.

No good will come from propping up an American company (or any company for that matter) that can not survive on it’s own in a global marketplace.

If my great country can step up to the plate, produce good quality products that compete with foreign counterparts.  There will be no need to ask that our citizens buy American.  They just will.

Business, Economics Buy American, capitalism, global economy, global markets