Anyone can have a bad call but when you dedicate an entire book to it?

Jim Rodgers, a peripatetic,bow-tie wearing, prolific financial commentator and author, wrote a book published in December 2007 entitled a Bull in China, Investing Profitably in the World’s Greatest Market.  Rodgers was a vocal proponent of the theory that the sun has set on the West and China was the future.  No one is in fact more associated with this theory than him.  So how well has the investment turned out for his readers.  While Rodgers recommended dozens of stocks, many of which are impossible to price, it’s fair to say that when you advocate purchasing  more than forty different companies, your returns will have some close affinity to the market at large.

So let’s see how those investments might  have fared.  Not so good if you look at the Hong Kong Hang Seng Index.  On the first trading day of December 2007, the Hang Seng closed at 28,658.  Yesterday it closed at 1889.70.   That’s down 34% in almost four years.  Ok, the Hang Seng is Hong Kong, not mainland China.  Well, let’s try the iShares FTSE China 25., the largest Chinese companies.  In December 3 2007, it was at 60.07 per share.  Today it closed at 35.18.  That’s a whopping decline of 41%.   In all fairness, the markets are down in this country too.  In December 2007, the S&P 500 closed at 1472.  Yesterday it closed at 1200.  That’s a decline too but a 22% decline is far better than the near 40% decline the Chinese markets had during the same period.  Only on Wall Street can Jim Rodgers get invited on TV, lecture all over the world, and be generally regarded by the financial press as an illuminary when you get it wrong by that much.  So why should we listen to him now about the U.S., Europe, or for anything for that matter?