Jim O’Neill of Goldman Sachs, who originally coined the famous BRIC’s (Brazil, Russia, India, China) investment theme, is now saying that Brazil is no longer the most attractive investment of the four countries. He says Russia takes the top spot due to several reasons (via Bloomberg):
On weighting the United States versus a BRIC investment:
“This is why the policy developments in Europe and the U.S. of the past fortnight are so important.”
“I’m passionate of the view that most benchmarks or investors all over the world are stuck in history. And given the fiscal issues and the challenges facing the G7 countries – because Japan it’s true as well – and the absence of growth, it seems to me that both in debt and equity benchmarks, the neutral position for the BRIC countries and other growth economies needs t be raised significantly. That is certainly the way I am trying to guide the whole of our entity and I’m sure it’s how many investors are going to be thinking as we creep forward.”
On, if there were only one BRIC country he could put money in, would it be Brazil:
“No it would not be [Brazil]. I mean I’ve loved Brazil for many years but nothing ever goes in a straight line. I worry about the real – it’s far too strong. Very controversially, of the four, I would actually pick Russia right now. I think it’s got a lot of value and at the margin they’re doing one or two things in a better direction.”
Source: Bloomberg TV
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.