No. of Recommendations: 13
It's profitable for him to do so? Japanese Interest rates remain low (around 1%?) so he is able to borrow at really cheap rates there and use that money to buy higher yielding assets.That's right. Munger discussed this during his interview on the Acquired podcast back in the fall:
"The interest rates in Japan were 0.5% a year for 10 years, and these trading companies were really entrenched old companies," Munger said. "They had all these cheap copper mines and rubber plantations, and so you could borrow for 10 years ahead all the money and you could buy the stocks, and the stocks made 5% dividends, so there's a huge flow of cash with no investment, no thought, no anything."
"The only way you could get it was to be very patient and just pick away at little pieces at a time," Munger said. "It took forever to get $10 billion invested, but
it was like having God just opening a chest and just pouring money into it. It was awfully easy money."
markets.businessinsider.com - Charlie munger acquired podcast warren buffett japan stocks trade berkshire
