Business

Julian Robertson: Greece Will Not Trigger A Global Financial Crisis

Julian Robertson, the founder of Tiger Management, believes that Greece is not at risk of triggering another global financial crisis.

Get The Full Seth Klarman Series in PDF

Get the entire 10-part series on Seth Klarman in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues.

During an interview with Kelly Evans of CNBC’s Closing Bell, Robertson said Greece is not an economic power in the world although the country could “involve contagion.” He emphasized that “we can adjust to Greece.”

Julian Robertson said Spain would be affected by Greece. He noted that Spain has a serious problem with individual debt throughout the country. “If Greek goes, Spain could have problems. They could be tempted to leave [Euroxone] too,” said Robertson. He does not thin that Greece itself is terribly important.

Julian Robertson

Julian Robertson is still shorting the euro currency

Julian Robertson said he was still shorting the euro currency. He expects the euro to go below parity. Currently, the euro is down almost 20% against the dollar. €1 is equivalent to $1.10 as of today, July 1 at 3:00 PM in New York.

Robertson believes that the euro would go down “fairly quickly” if Greece exit the Eurozone because of the contagion possibilities of the situation.

When asked about European equities, Julian Robertson indicated that is still bullish on it. He said, “European equities have been a very good place to be, and-- you know-- may still be, and would be possibly even better.” He added, “But you certainly want to hedge the currency, which would, of course-- help in getting that euro down quicker.”

Robertson also thinks that the markets are overheated

Carl Icahn recently stated that the markets look extremely overheated. Julian Robertson said he shared the same perception, but not exactly for the same reason—euro situation.

He explained that the markets were overheated because we have a credit bubble. He said,” I think, we are really in the midst of a very serious credit bubble.” Robertson noted that people are compelled to invest in stocks because they are charged to put their money in the bank, and they don’t get interest.

Julian Robertson explained that the credit bubble he perceived was forced. According to him, “Money, which would ordinarily be in bonds go into stocks. As yields go up, that will be heightened by people coming out of stocks and going where they belong in the first place, bonds.”

Robertson is very bullish on JD.com, Apple

When asked about his investments in China, Julian Robertson said some Chinese companies are great prospects. According to him, he moved his investment from Alibaba Group Holdings to JD.com. He believes that JD.com has the advantage over all Chinese companies because it never had any knockoff problems. He is “very bullish” on JD.com.

Julian Robertson is also “very positive” on Apple citing the reason that the company “has the right leader for this time.” He said Tim Cook is a very good leader and the perfect person to lead the company.

“I think possibly at this point in its time, he would be better for Apple than Steve Jobs,” said Robertson. He explained that Cook is more of a humanist, which Apple needs given its size. According to him, Apple needs a leader rather than an innovator.