Speaking at the Schwab Impact Conference in San Fransisco, heavyweight investor Mario Gabelli had some insights to offer on his investment strategy and what ails American economy.
“Clearly the banks are the problems. The banks have invested in their own country’s debt. It’s been cross –collateralized. And a chain is no stronger than its weakest link. That is the credit default swaps and the American Banks have ensured that”
Prescience Partners returned 6.75% for the second quarter, underperforming the S&P 500's 8.55% return but coming out ahead of the Barclay Equity Long/ Short Index's 2.62% return. However, for the first six months of the year, Prescience is up 30.66%, doubling the S&P's 15.25% return and smashing the Barclay Equity Long/ Short Index's 9.27% return. Read More
“We buy good businesses that have pricing power that can grow assets. For example, this week I was down in Las Vegas… in 1977 we started buying for clients genuine [car] parts. … they’ve never had a year in which they didn’t raise the dividend since 1948”
To a question about which mega trends was he looking at – “They are not necessarily mega trends. They’re obvious trends. When I went to China in 1981, we …look at the intrinsic value. What is it worth? What is it going to be worth in five years?”
“We are blessed in America with executives that come to work every day to make clients money. And yet we have an environment economically that is fragile. … the United States consumer is being deleveraged. The state and local governments are being de-leveraged. ..We got lazy, we lost focus”
“We go back to the core that made this country great, which is meritocracy”