Hedge fund manager Hugh Hendry of Eclectica gave a brief interview at the annual GAIM hedge fund conference in which he explains succinctly why he’s bearish on Japan.
Basically, he’s betting on a recession in Asia.
The video is below. Here’s the key part:
“The [popular] notion is they’ve been down the hole for 20 years, and all the bad things have happened. While I don’t disagree with the timing of it, they haven’t actually remedied or confronted what their problem is.
Their problem is they have too much (like the rest of us) debt and they have used very low interest rates to take on more debt and so I’m worried that should the unlikely happen, should we see a terrific slowdown or a recession in Asia, then I think that Japan could prove to be very vulnerable.”
There’s another fun moment in the interview too. In the beginning, he explains what he says to potential investors: “I’m Hugh Hendry, I’m eclectic, and when bad things happen, I make money.”
And does Hugh have any advice for people worried about the uncertainties in the market?
HH: “Don’t listen to Hugh Hendry. He’s a loser.”