Transcript: Mark Mobius



The transcript from this week’s, MiB: Mark Mobius on Emerging Markets, is below.

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ANNOUNCER: This is Masters in Business with Barry Ritholtz on Bloomberg Radio.

BARRY RITHOLTZ, HOST, MASTERS IN BUSINESS: This week on the podcast, I once again have an extra special guest and I really mean an extra special guest. Dr. Mark Mobius is a legend in the world of emerging market and frontier investing. He is one of the first people or first Americans who went out and actually started kicking tires and looking at various companies all around the world. He’s been doing this so long, that when he first began, there were only six investable countries that you could put your money into. The rest of the world either didn’t have public companies or public markets. You couldn’t get cash in and out. There weren’t custodians. It’s amazing that this is the guy that essentially created EM. There were a couple of other folks doing something like this, but no one quite the way that Dr. Mark Mobius did.

I found this conversation to be absolutely fascinating. I had like another three hours’ worth of questions for him. We barely got through an hour. If you’re at all interested in what the process is like of doing EM investing, what you find that either makes you more enthusiastic about a company or a company you’re enthusiastic that when you go and kick the tires, you start to find out that, hey, this season has presented. This is just an absolutely tour de force fascinating conversation.

So with no further ado, my interview with Dr. Mark Mobius.

ANNOUNCER: This is Masters in Business with Barry Ritholtz on Bloomberg Radio.

RITHOLTZ: This week, my extra special guest is Dr. Mark Mobius. He is the founding partner of Mobius Capital Partners. Previously, he spent 40 years working and traveling in emerging market and frontier markets. Before Mobius launched in 2018, he worked with Franklin Templeton Investments for more than 30 years, where he was Executive Chairman of the Templeton Emerging Market Groups. During his tenure there, he helped to expand the assets under management from $100 million to over $50 billion throughout Asia, Latin America, Africa and Eastern Europe. He ran a series of open-ends, closed ends and private EM funds, including private equity funds. He has also been on the World Bank’s Global Corporate Governance Forum. Dr. Mark Mobius, welcome to Bloomberg.

MARK MOBIUS, FOUNDER, MOBIUS CAPITAL PARTNERS LLP: Thank you. It’s great being with you.

RITHOLTZ: So that is quite a storied career. Let’s start in the early parts of it. You took a very different route than most people in finance. You worked at a talent agency. You were a communications teacher, a political consultant, and am I reading this right? Did you actually market Snoopy merchandise in Asia?

MOBIUS: Yes, I did. That’s right. When I was in Hong Kong, I had a consulting firm. And one of my clients was looking for people who manufacture products. So she had a company in San Francisco called Turn To Turn Productions. They had the rights to all of the Snoopy merchandise, all the Peanuts merchandise. And she asked me to look for manufacturers in Asia. And one day I said, “Why don’t you start selling in Asia?” And they didn’t think about that. So they said, “Why don’t you do it?” And of course, that’s how I got involved in distributing these products in Asia, or at least in Hong Kong, in the Greater China area.

RITHOLTZ: So is that how a kid from Hempstead, you grew up like 45 minutes from where I am right now, is that how you got involved in international business and investing?

MOBIUS: That happened way before that because I got a scholarship to study in Japan, after I got my master’s degree at BU. And that really changed my life because, you know, the culture shock of being in Japan, completely different culture, an incredible country growing very rapidly at that time. That was really what changed me and I decided to go back, I got my PhD at MIT, and then went right back to Asia and started working.

RITHOLTZ: So BU masters, Kyoto, postgraduate work, MIT PhD, you also studied at Wisconsin, Syracuse, New Mexico. That seems to be a very heavy focus on education.

MOBIUS: It was. I was a professional student. I really didn’t want to leave university, and that’s the reason why I did a sort of a round robin of these different universities. But then, finally, when I got my PhD, I said, “Okay, let’s — let’s get real. Let’s find out what I — you know, what I should be doing in this world?

RITHOLTZ: And how did you end up at the Mega International Investment Trust in Taiwan?

MOBIUS: That was — yeah, International Investment Trust was a — before that, I was working for a broker in Hong Kong. It was a British broker, Vickers-da-Costa. And they sent me to Taiwan to open an office and also sit on the board of a joint venture they had with local banks and some other British firms, which was the very first investment management firm in Taiwan called International Investment Trust. And eventually, the guy that was running it left and I took over. So I became the head of that company, which they launched the Taiwan ROC Fund, which I think the remnants of it, they’re still listed in New York, I believe.

RITHOLTZ: Wow. So over the course of your career, you’ve traveled well over a million miles. You’ve been to 112 countries. I have to ask what are some of your favorite places to travel? And what are some of the favorite foods you’ve eaten?

MOBIUS: You know, it’s really interesting when I racked my brains and tried to figure out where I like it the best, I really can’t come up with an answer because every place I’ve been I’ve liked in some way or another. But probably if you ask me right now, where would you like to be? And probably it would be the beach of Rio de Janeiro in Brazil. That might be a place that would be nice to be, or a beach at Cape Town, South Africa. I love outdoor life. I love beaches and that sort of thing. But frankly, I lived in Japan and Korea and Taiwan, Philippines. I love all these places. I really can’t think of any one that’s particularly a favorite.

RITHOLTZ: Let’s talk about food because I recall hearing you once say that you ate scorpions on toast. Is that right? That does not sound —

MOBIUS: That’s right.

RITHOLTZ: Is that sort of like softshell crabs? What do they actually taste like?

MOBIUS: Actually, that was in Singapore, in a restaurant that specialized in special sort of medicinally beneficial foods supposedly, and this scorpion on toast. It was sort of like eating crispy shrimp, but it has a little bit of a bite to it so, you know, a little bit of a stingy taste to it.

RITHOLTZ: And I assume they removed the poison first or is that — is that just digestible?

MOBIUS: Yeah, they do. They do remove most of the poison, but some of the sting was still there. It was very similar to — in Japan, if you’ve ever had fugu, which is the blowfish.


MOBIUS: It still has a stinging sensation on your lips, which is supposed to be part of the experience.

RITHOLTZ: I understand Singapore has become the food capital of Asia. What’s it like there?

MOBIUS: It is true that Singapore has an incredible variety of dishes because you’ve got not only all the Chinese cuisines which, as you know, are very varied. And then you got cuisines in China that go from very, very spicy to very bland and so forth. But then you have the Malaysian and Indonesian foods. And added to that, of course, you have the Indian foods. So it is true that Singapore is quite varied in its menu.

RITHOLTZ: Quite mouthwatering. So let’s talk a little bit about Franklin Templeton. No less than Sir John Templeton asked you to run their emerging markets division in 1987. Tell us what EM was like back then. I have to think the world has changed a lot in the ensuing 30 plus years.

MOBIUS: That’s for sure. I mean, in 1987, I was sitting there in Taiwan running the fund management company that was doing the Taiwan fund, International Investment Trust, and I get a call from actually one of the deputies of the Templeton. I had made presentations to him in his space in Nassau, Bahamas a number of times, and I guess he remembered me. And as you know, at that time, emerging markets were just — the term was coined by the international finance organization. And they had — they had launched the emerging market fund, and then Templeton said that he wanted to do the same thing.

So he approached me and said, “Let’s raise $100 million in New York and do this emerging markets fund.” And it was a great temptation for me because it enabled me to really expand out of Taiwan into something really exciting. But it was a tough decision as well because I didn’t really know what I was getting into. And we opened a small office in Hong Kong. I hired two analysts, two Chinese analysts who, by the way, stayed with me for those 30 years I was in Franklin Templeton.


MOBIUS: And yeah, and we started with only six countries. You must remember, in those days, most countries did not welcome foreign investment.


MOBIUS: They were also either socialist or communist like China and Russia. Eastern Europe was out of the question, of course. So we had only six markets in which to invest, and then we started expanding. Gradually, markets opened up. And eventually we were investing in something like 70 different countries around the world.

RITHOLTZ: Do you recall what the original six countries were?

MOBIUS: They were Hong Kong, of course, Philippines, Malaysia, Singapore, Thailand and Mexico.

RITHOLTZ: No Japan? No South Korea?

MOBIUS: That’s right. No Japan and no South Korea.

RITHOLTZ: They were considered — they were no longer considered EM countries?

MOBIUS: Actually, South Korea was, but it was closed for one reason or another. There were difficulties in getting in. You must remember, you know, the whole idea of getting a custodian to safe keep your securities, all of these technical issues were there. And Japan, of course, had graduated into a developed country by that time.


RITHOLTZ: So back in the 1980s, I’m going to assume there was no remote access. It was always boots on the ground. Is that how research was done?

MOBIUS: That’s for sure. Don’t forget no Internet, no laptop computer, no cell phones. You know, technology has really changed things tremendously.

RITHOLTZ: So tell us what did you learn from traveling as opposed to just a phone call, assuming you can actually call anybody?

MOBIUS: Well, you know, it’s true that we’re able to do a lot on the phone these days, and particularly with video conferencing, because you could see the people. But there’s nothing like being in a country, smelling the smells that you get, looking at the people, getting a feeling for how people are living. And then you walk into a company, you look around, you observe what the nature of the company is like, what is the morale of the staff, et cetera, et cetera. So there’s nothing that beats that being on the ground and seeing for yourself what’s going on. So we always think that it’s important to be traveling and visiting companies as much as possible.

RITHOLTZ: So let’s talk a little bit about your process. Is it top down, you start in a country and then dig into individual companies? Or do you go bottoms up, start with the company and then work your way through that local either country or region?

MOBIUS: Well, we like to say that we’re bottom up investors in the sense that we look at the companies intensely. But that doesn’t mean we ignore the macro, the top down approach. Because obviously, you know, let’s say, if we wanted to invest in Sri Lanka today, obviously, you’d have to look at what’s happened to the currency, what’s happened to interest rates, what the government is doing, what kind of restrictions that are taking place for foreign investors to invest, that sort of thing.

But after those critical issues, currency, ability to move money in and out, then we dig into the individual company, because that’s the key. Because one of the things I’ve found over the years is that a company can survive in a very difficult environment, and you shouldn’t be afraid to go into a country where the environment is not ideal, as long as you can get money in and out. That’s really the key.

Even the currency, if the currency is declining or getting very, very weak, for one reason or another, there’s still opportunities because, for example, an export-oriented company can do very well in such an environment because they’re earning in dollars and their costs are in local currency. So I would say, yeah, we’re more ground up and more fundamentally company-oriented in the way we approach things.

RITHOLTZ: So today, I could fly into a different country where I don’t speak the local language, use my iPhone with Google Translate or any one of a dozen other translation apps and be able to communicate with people. What did you do back in the ‘80s and ‘90s? I’m assuming you don’t speak dozens and dozens of languages. What happens when you show up and you’re not fluent?

MOBIUS: Well, that’s very interesting and very good thing that we found when we traveled and went to these countries is that you always found people who spoke English, particularly when you were visiting listed companies, companies listed on various stock exchanges, which is where we were looking.

Inevitably, in every company, you would find somebody who’s going to be able to translate for you. And more often than not, the top management were English speaking, English educated, you know, so they were — it was quite easy to get information and get face-to-face communications with these people. There are some exceptions, but not that often. It was quite good and quite easy to get people to communicate. And even if the company officials did not speak English, we were able to find translators easily enough.

RITHOLTZ: And who else did you speak to? I mean, obviously, you spoke with management, but did you speak to local customers or workers at various places? How comprehensive was your boots on the ground due diligence?

MOBIUS: Well, that’s one thing we found, much to our chagrin, that don’t talk to just the top management. We made many mistakes by just talking to top management. But you got to talk to the staff, talk to the customers, talk to competitors. Competitors are a great source of information. Because if you have a competitor who’s speaking very highly of the company, that’s a pretty good sign of the quality of the company you’re talking about. And then we do also talk to government officials. You know, are there any transgressions on the part of the company, or any problems in the industry? So you really have to open up to wide variety of sources. And by the way, that’s one of the advantages of being on the ground as well.

RITHOLTZ: To say the least. So when we look at the environment today, active buy side managers, they use a lot of financial models. They use big data. They have the ability to crunch a lot of economic assumptions. What was it like in the 1980s and 90s? I’m going to assume you didn’t have access to all that modern technology and AI.

MOBIUS: That’s right, that was not available. Of course, don’t forget, this was the age before method. You know the method program, where you had to separate brokerage fees and research. And in those days, we were able to get an awful lot of information free of charge from brokers who we’re dealing with. Of course, you might not say free of charge because we’re paying them brokerage commission. But we were going to give them orders anyway.

So it was very easy to get information, a lot of research from brokers who were doing research. And there were also local research institutions who produce research. So gradually, the knowledge built up. Of course, at the beginning, in ‘87, there was almost nothing available. But by 1995, ‘96, at that time, there were lots of information flowing out of these various firms.

RITHOLTZ: Really quite fascinating. So let’s talk a little bit about traveling to different countries and hunting down specific companies. What do you recall as a particularly spectacular investment that you discovered after traveling to a country and were just really surprised by what you found researching a company?

MOBIUS: Probably the best example was in China. That was when we discovered a company in China that made the gears for wind power companies. That was about 15 years ago. That’s when, you know, the whole area of wind power was coming up strong. And this company was doing incredible work. We visited the factory and I noticed that the machine tools they were making were top notch, you know, automated machine tools. And they were doing very high quality work, according to their customers.

So we decided we’d invest in that company and that turned out to be an incredible investment. That, you know, doubled or tripled the price we paid. So that was probably one good example of, you know, doing on the ground research and finding something that other people are not noticing. And by the way, I think that’s one of the pitches of good investing is finding something that other people are not finding. In other words, try to discover a company that has not been yet so-called discovered by market.

RITHOLTZ: What about the opposite? Did you ever show up somewhere excited about a specific company and only to discover, hey, this isn’t what we were hoping for?

MOBIUS: Many times. Because many times, we were fooled by the information we’re getting. And you know, we have varied missteps along the way. It is the feature of investing, anyway, as you know. But in emerging markets, you have to be special, and be very, very extra careful.

RITHOLTZ: So — so when you started doing this in the late ‘80s, was anyone else from the United States or other U.S. investment firms actually traveling the world looking at companies? You’re sort of the Indiana Jones of this. How long did it take for other investment firms to say, hey, we need an EM or developed ex-U.S. funds, and we need someone like Mobius out kicking the tires?

MOBIUS: It took about five years for, you know, the field to grow, where once they saw the results that we were getting, a lot of people began to jump on the bandwagon. You must remember that the pioneer on this was the IFC, the International Finance Corporation. They started emerging markets in (inaudible) funds about — a little earlier than we started our fund. So they were on that. As you know, they were the precursor to the index because this Capital International was the — they were the people that were doing researches of companies all around the world.

RITHOLTZ: So you started venturing into Africa way earlier than just about everybody else. What led you to discover that continent, and how have the results been?

MOBIUS: Well, you know, as the assets expanded, we really had to find new opportunities everywhere. And Africa was wide open, there were just — there was so much there. And of course, visits, initial visits there really excited us because we realized this is ground that has not been tilled in any direction, lots of opportunities, where there’s no information, which is an advantage, because if you’re on the ground, if you’re able to travel these places and get information, then you have an edge on any competitor that must come in.

So I saw tremendous opportunities in places like South Africa, in Nigeria, in Kenya, and of course, Africa, so huge. There are so many countries. There’s tremendous opportunity. Of course, the big challenge was to find an equity market, a stock market —


MOBIUS: — and liquidity. Of course, one of the biggest challenges you get, of course, is liquidity, getting enough of liquidity to be able to invest significant amounts of money.

RITHOLTZ: You have to be able to move in and out, and not completely disrupt the price or the market.

MOBIUS: Exactly. And by the way, that was one of the reasons why we got involved in private equity, because we found so many of these opportunities, but some of them, of course, we’re not listed. Some of them were listed, but there was no liquidity at all. And we decided, hey, why don’t we do a private equity fund, where you know, the holding period for the clients would be five, six, seven years, then we can develop these companies and bring it to the market with more liquidity as we expand. So that was a very, very good move for us.


RITHOLTZ: And anything stands out as a particularly exceptional or shocking story that didn’t involve finance or a company when you were — when you were traveling all over the world? I have to imagine there were some pretty memorable snafus along the way.

MOBIUS: Well, we got caught in a revolution in Philippines, where they’re shooting at the hotel, and we were able to get out, luckily, by helicopter from the roof of the hotel. That was one example. But they were fused post calls like that, but never deterred us, for some reason. Maybe we were too innocent. We felt that, you know, we have to roll with the punches, so to speak. But there’s always some kind of turmoil going on. As you know, I was recently in Sri Lanka. And you know, you can still work and you can still visit companies. But meanwhile, people are demonstrating on the street.

RITHOLTZ: Wow. That’s pretty amazing. So let’s talk a little bit about emerging markets versus the United States. This is, I think, the 12th or 13th year prior to 2022, where the U.S. has outperformed emerging markets. I think that’s the longest run we’ve seen in a number of decades. What’s it going to take for EM to make its comeback against the United States in 2022? Maybe this is the year.

MOBIUS: That’s a great question. One thing you’ve got to realize is that the world has changed to the extent that a lot of the emerging markets growth is now in the United States, because U.S. companies are manufacturing and selling and buying from emerging countries.


MOBIUS: When we saw it in 1987, the whole premise of going into emerging markets was to capture the growth. Because these countries were — these were the low and middle income countries on a per capita basis, they were growing at more than double that of the developed countries, U.S., Japan, Europe, Australia, New Zealand.

Now, what’s happened is that a lot of these companies based in the U.S. might even be called emerging market companies. For example, let’s take Apple. Now, 1% of their manufacturing is done in Asia, let’s say, or elsewhere, and 1% of their sales are in emerging countries like China. So it’s become much more difficult to define what is an emerging market. And if you travel to some of these countries, you will be amazed of the growth and the way they’ve developed. And you know, just the infrastructure is just incredible, what’s happened in many of these countries.

So it’s become more and more difficult to define specifically what is an emerging market company and even the definition of country, (inaudible) country is blurred. For example, let’s say Korea, Korea was a very poor country when we started in 1987. Today, it ranks as one of the — on a per capita basis, one of the richer countries.


MOBIUS: So the (Queens) has always been saying recently that they’re not an emerging market country. They’re more developed country, which I think rings true.

RITHOLTZ: So do you still do the same degree of traveling you were doing 25, 30 years ago? Are you, you know, on the road eight months a year? What’s it like today?

MOBIUS: Well, I try to travel as much as I can, but with COVID, it’s been so difficult. Thankfully, things are loosening up and I’m able to travel. I base myself now in Dubai. And of course, I have a place in Singapore, but Singapore has been so restrictive. Thankfully, they’re opening up. And other countries are beginning to open up. Recently, as I said, I’ve been in Sri Lanka, in Thailand, and I’m trying to get out to more countries as they open up and they get rid of these lockups. Of course, China is off the chart in terms of restrictions. So that’s out of the question at this stage. But yes, I’m trying to travel as much as I can.

RITHOLTZ: So Dubai and Singapore. You know, if you’re bicoastal, if you’re in New York and London, or New York and San Francisco or LA, that’s what they would call it. What do you call splitting your time between Dubai and Singapore? Are those just base of operations for when you’re shooting off to those parts of the world?

MOBIUS: Yeah. Singapore is great for visiting the rest of Asia, you know, a great — a lot of it has to do with the airlines. Singapore Airlines had great connections all over Asia.

RITHOLTZ: Right. And it’s a great airline.

MOBIUS: Great airline. And Emirates is even a better airline, in some ways. Emirates goes all over the world. And I’m able to come to here, to Europe, I’m now in London, and to the U.S. very easily. Excellent airlines. By the way, there’s two good examples of companies in, well, emerging markets, or maybe you could still call them emerging markets, that have really surpassed the U.S. airlines in terms of service, quality, et cetera, et cetera. So, yeah, these two bases are very good, probably because of time zones. In Dubai, the time zone is very convenient, but also because of the convenience of travel.

RITHOLTZ: Really quite — quite interesting. So — so let’s talk about some of the bigger issues going on globally today. Russia has become a bit of an anathema internationally, given the invasion of Ukraine. Do we just write down our Russian stocks to zero? Are they ever going to be investable again in our lifetimes, or are they just a total pariah state at this point?

MOBIUS: Well, in our fund, we were out of Russia about a year ago because we didn’t like the corporate governance issues that were popping up. You know, the oligarchs were taking over a lot of the companies. But I’m not writing off Russia by no means. I think there’ll be a day when we will go back in. And in fact, I personally keep an account in Russia. And of course, the stock — it’s a very small account, but the stocks in that account are way down. But I think eventually this will come back. But for our fund, we will not go in until things change dramatically in Russia.

RITHOLTZ: Is that going to require Putin to leave power in order for the country to be investable again? Or can something significantly change to rehabilitate their image in the world?

MOBIUS: It will probably mean Putin leaving, probably, because it would require a complete about face and it would require all of the Western countries to stop the sanctions. Because you must remember, even if I wanted today to invest in a Russian stock, I couldn’t do it because of custodians.


MOBIUS: I’m not operating there, you know.

RITHOLTZ: You talk about — talk about being canceled, it looks like very much like Russia was now. Previously, you were on the board of directors of Lukoil. I’m assuming that ended some time ago, if I recall reading correctly. And you were also involved with OMV Petrom in Romania. Tell us a little bit about those experiences.

MOBIUS: Yeah. OMV Petrom came out about — that was about 10 years ago. We got the contract to run the country funds for the Romanian government. It was quite an unusual situation where they wanted to compensate people who had lost their assets during the (fiscal) period, and they put about 20% or 30% of all the government companies into a fund. And we won the contract to run that. And one of the companies was Petrom. And OMV, the Austrian company came in as a majority shareholder of that company, and we were still holding it and they asked me to be on the board. So we were looking at and getting very deeply involved in many of these Romanian companies.

And it’s a great example of where a country, you know, took the decision to sort of privatize state-owned companies that were previously very corrupt, and made a tremendous success of it. And also, kudos go to the European Union, because being a member of the European Union, whenever we went to court, there were tremendous amounts of court battles, the judges would be looking over their shoulders at battles. So we were often treated much fairly than we would have been if they weren’t the members of the European Union.

RITHOLTZ: All right. So — so let’s talk a little bit about China. Last year, they pretty much went after their own tech sector. Do we — first, do we still consider China an emerging market? And second, are they another country that’s becoming increasingly uninvestable?

MOBIUS: Yes, it’s still an emerging country, defined as a low and middle income country. So that’s definitely there. The problem with China, of course, it’s gotten too big in the spectrum of emerging market economies. Because if you look at the emerging markets indexes, you’ll find that it’s 30% or so China. So whenever China gets hit, emerging markets look terrible. And that’s the reason why a lot of people have been sort of turned off because, as you know, so many people are buying ETFs and index funds.

But it’s a good example of where government policy can have a very big impact on your companies. And the measures that China took against the large tech giants in China really damaged the market dramatically because of the impact of those big companies on the China index. So there are cases where you got to pay attention to those macro moves by the governments. But you have to focus on the economic or financial aspect rather than purely political aspects, unless, and this is a very important point, unless the political structure begins to change against free enterprise against companies.

And a good example of that was in Venezuela. We were in Venezuela when Chavez came into power. And he started talking about taking over companies, about nationalizing companies. And immediately, we got out because we realized that this was not going to be very conducive. And it’s good we did get out because companies that we owned really crashed, and it was a very bad situation. So — but that doesn’t — recently, that doesn’t happen that often. But China is probably a good example of where government policies can really have a very damaging effect on individual companies.

RITHOLTZ: What about inflation? It’s been a giant topic here in the U.S. and we’ve seen numbers around the world have spiked up. How does inflation affect emerging markets?

MOBIUS: Well, you know, the great thing about inflation is that if you’re an equity investor, in other words, an investor in companies that can adjust their pricing in line with higher prices, then inflation is not a problem. In fact, sometimes it’s an advantage, because you see prices moving. And if you’re in a company, as I mentioned, with that pricing power, you can do very, very well, because they’re moving up prices at a rapid rate.

It’s interesting. If you look at the correlation between inflation numbers and let’s say the S&P 500, there’s very low correlation in those numbers, and that’s probably one of the reasons because good companies that are adjusting their prices in line with the devaluation of the currency can do very well. By the way, I pointed out in the book I just came up with, about inflation, it’s called the inflation myth, and I mentioned this phenomenon,

RITHOLTZ: That — that emerging market inflation is actually not a problem?

MOBIUS: That’s correct. Provided, and this is the big proviso, you’re in companies that have pricing power.

RITHOLTZ: Really interesting. The inflation myth and the wonderful world of deflation.

MOBIUS: Yes. And you know, I mentioned that the reason why I put that in, the wonderful world of deflation, because most economists hate deflation, but I argue that deflation is a good thing because deflation means that costs are going down, and people are benefiting from lower and lower costs. And what I pointed out in the book is that technology is making things better and cheaper in terms of pricing power, in terms of earning power. And I’ve seen that my lifetime.

You know, when I had my own research firm, I had to carry around this electric typewriter. There were no laptops.


MOBIUS: There were no Word, no Excel, nothing of that sort. And when, you know, I mention to young people I had this electric typewriter, they ask me, “What is that?” So the technology has really made life so much easier and more affordable for so many people.

RITHOLTZ: I don’t disagree. We’ve been in an era for the past, I don’t know, 30 years. That’s been primarily deflation, with these casual spikes of inflation. I find it kind of hard to understand how all of these older economists keep talking that we’re going back to the 1970s, when the world today seems so different than it was back then.

MOBIUS: Exactly, exactly. You talk to any young person, you realize that they are even benefiting more because they know how to use this technology better than old timers like me.

RITHOLTZ: So before I get to my favorite questions, I have one last question for you and it has to do with back in 2009, in the middle of the financial crisis, you pretty much called the start of a new bull market. Tell us about what you were seeing at the end of the great financial crisis, and what made you so confident that was a great time to jump back into equities.

MOBIUS: Well, you know, my studies showed that all these bear markets are very short in duration, maybe they’re one or two years, at most, three years, you know. And unfortunately, many people measure a bear market from the peak of the previous bull to the peak of the next bull market.


MOBIUS: And that’s a wrong way of measuring it. You should measure it from the peak to the bottom. And as soon as you get to the bottom, it starts moving, you’re in a new bull market and it’s a wonderful time to invest because, you know, the percentages are in your favor. So that’s what I saw.

I looked at the history and I figured, hey, this is not going to last forever. People are very pessimistic. It’s a great time to be investing, and it turned out to be right. And by the way, that happened three years ago, three years ago now. You know, when we had the COVID situation, it was an incredible time to invest. And you know, that was less than a year that the market crashed and then started recovering.

RITHOLTZ: Right. That 34% drop took place over six weeks. And I think by August, we were back to breakeven. It was pretty, pretty impressive.


RITHOLTZ: I only have you for another five minutes, so let me get to my five favorite questions I ask all my guests. You can think of this as a speed rounds. Let’s quickly run through all five of these, starting with tell us what you’ve been streaming during the lockdown. What was keeping you entertained on either Netflix or Amazon Prime or whatever you were doing to entertain yourself?

MOBIUS: Well, I found that YouTube is incredible educational —

RITHOLTZ: Amazing.

MOBIUS: — media and incredible programs. And of course, I also click on Bloomberg and look at news. If I want to know something about a country, I put news and then the country, and a lot of stuff pops up. So those are the two sources that I found to be very, very good.

RITHOLTZ: Tell us about your early mentors who helped to shape your career.

MOBIUS: Well, John Templeton was really that man. He was an incredible investor, a wonderful person. He really was an inspiration. And as you know, he lives on through his Templeton Prize. You know, Templeton Prize is larger than the Nobel Prizes.

RITHOLTZ: Oh, really?

MOBIUS: Because, yeah, he believed that a prize for religion for, you know, the science of religion was most important. So he said — he specified that his prize should be bigger than the Nobel Prize. And of course, it still is. They’ve got an incredible foundation.

RITHOLTZ: Tell us about some of your favorite books and what you’re reading right now.

MOBIUS: Well, I just finished a book called “Double Entry,” which is a wonderful book. You know, it sounds boring. It sounds like bookkeeping, but it’s not. It’s about the history of the double entry accounting. But it goes into the whole revolution that took place in the Middle Ages, and how people in the Middle Ages adopted the Arabic script and the calculations that came out of the Arab world. And it was — it’s an incredible book. So I’m reading that. I love the history.

I’m also — I started the book on Cleopatra not necessarily because I’m fascinated by the woman Cleopatra, but by the era. It tells about what kind of environment she lived in, which is fascinating. So I think —

RITHOLTZ: Cleopatra?

MOBIUS: Cleopatra. Yeah.

RITHOLTZ: Any others? Any longtime favorites that you really want to reference?

MOBIUS: Well, I also like books about archaeology. So I’ve been reading a number of books on particularly Latin American archaeology, because I think a lot in Latin America has been overlooked. There was so much emphasis on Egyptian archaeology. But I think Latin American archaeology is incredibly fascinating.

RITHOLTZ: Really intriguing. What sort of advice would you give to a recent college graduate who is interested in a career in either investing or emerging market and frontier market investing?

MOBIUS: Well, first of all, travel, I mean, you’re young. You can get out. You can travel to all these countries. And that’s a tremendous learning experience to go to these different countries. And stay humble. You know, listen to what other people are saying. Read as much as you can, and keep on asking questions. Don’t think you have all the answers. Remember, John Templeton once said, “Those people who think they have all the answers don’t even know the questions.” And I think young people should, you know, remember that. It’s very important.

RITHOLTZ: And our final question, what do you know about the world of investing today that you wish you knew 35 years ago when you first started in EM investing?

MOBIUS: It’s not all in the numbers. In other words, you know, when we started, we looked at the balance sheet, the profit and loss statements, and we thought that was the most important thing. It’s not. The most important thing are the people. Who is running the company? What are the associates of that person doing? It’s very important to get to know the people because people create wealth.

RITHOLTZ: Quite fascinating. Thank you, Mark, for being so generous with your time. We have been speaking with Dr. Mark Mobius now of Mobius Capital, previously with Franklin Templeton Investments.

If you enjoy this conversation, and I do believe this is now the 400th one that showed up on iTunes, be sure to check out any of our previous 399 such discussions. You can find those at Spotify, iTunes, wherever you get your podcasts from.

We love your comments, feedback, and suggestions. Write to us at Follow me on Twitter @ritholtz. You can sign up for our daily reading list at I would be remiss if I did not thank the crack team that helps put these conversations together each week. Mohamad Rimawi is my audio engineer. Atika Valbrun is our project manager. Paris Wald is my producer. Sean Russo is our head of Research.

I’m Barry Ritholtz. You’ve been listening to Masters in Business on Bloomberg Radio.





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