Street Smarts by Jim Rogers Analysis and Summary

Read time: 8 min

Life gets busy. Has Street Smarts been gathering dust on your bookshelf? Instead, pick up the key ideas now.

We’re scratching the surface here. If you don’t already have the book, order the book or get the audiobook for free to learn the juicy details.

The book Street Smarts by Jim Rogers is an engaging memoir where the author confides his personal struggles and aspirations with witty humor. It is also a great source of financial education and investment advice from a person who has traveled all over the world with the purpose to see and understand how the countries’ economies and political regimes have evolved.

Jim Rogers hasn’t spared his critical remarks against financial leaders who, in his opinion, hinder the market to regulate naturally and cause more harm than good with their interventions. Learn where the next great place to live will be and which country offers the best involvement opportunities at the moment.

This is from a guy who not only delivers financial commentary on TV but walks his talks with great success.

Jim Rogers started from a very humble beginning in rural Alabama. He got a thousand miles away from home to study in Yale, Connecticut, and it opened his eyes. He followed his passion to see more of the world and went on to study for two more years in Oxford, England. He started his journey in the financial markets when he was recruited by an old investment firm for a summer internship.

By the end of the summer, he knew exactly what he wanted to do for the rest of his life. He realized that on Wall Street he would be more compensated for doing all the things he loved to do. These included studying history, examining world events and correlations, research, travel, and exploring enough with formal education. He was going to work on Wall Street as soon as he could.

Some of his achievements worth mentioning include co-founding Quantum Fund with George Soros. He changed paths after 10 years to pursue a more exciting way of life. He traveled around the world on a motorcycle traversing six continents and more than 50 countries. He started his own international commodity index in 1998 which by 2012 had a total return four times more than the S&P.

Based on his personal experience. Jim Rogers shares his opinion on a variety of topics related to economy and politics.

1. Jim’s advice to graduates is to not do an MBA. Finance is over. Study agriculture and mining, and instead, over the next few decades, the farmers will drive the Lamborghinis while stockbrokers will be driving taxis.

The economy is all about cycles. To those who are still determined to work in finance. The study of philosophy and history is indispensable to an investor. To think differently from others is difficult. Philosophy teaches you to think and to doubt. History teaches us that what appears undisputed today will look very different tomorrow and that history repeats itself.

2. On investing: Invest in what you yourself have a wealth of knowledge about. Everybody knows a lot about something. Figure out what your real interest is and concentrate on it. You will see a major change coming in the industry long before anybody on Wall Street will because this is your passion.

This is what you are reading about all the time. You will know when it’s time to buy and sell. Once you have capitalized on your knowledge and made 10 times your money, a dangerous time comes. You think investing is an easy game and you are really smart. Don’t be fooled. It’s time to do anything but think about investing.

Wait patiently, wait until you see money lying over there in the corner. If you want to make a lot of money, resist diversification. If you buy 10 different stocks. The chances are some of them will be good. We’re not going to go broke, but you’re not going to make a lot of money either. The way to get rich is to find what’s good and concentrate your resources there, but make sure you’re right.

There are many financial vehicles you can invest in. Jim Rogers compares two of the biggest stocks and commodities. When evaluating if a stock is a good buy, there are hundreds of factors to understand. Employees, products, parts, suppliers, competitors, governments, balance sheets, unions. A commodity like cotton, by contrast, is pretty straightforward.

All you have to know about cotton is whether there’s too much or too little at the moment. That may not be so easy to figure out, but at least the question itself is simple. Three on school and tenure, even though he taught five semesters at Columbia Business School in order to get access to their gym, Jim Rogers doesn’t believe there’s anything useful to be gained by attending a business school.

There’s a lot more you can learn during an internship doing real work. And that is how he proceeded in his classes. He treated his students if, if they were his employees, they worked really hard and they appreciated that. The author views tenure as one of the main reasons why American tertiary education has become so expensive and not worth this price anymore.

Even worse is we’re incompetent. Teachers find refuge in excellence and teaching has never been the way to attain it. Publishing research in campus politics is what leads one to tenure. There’s no other profession in the world where if you work for seven years, you get a lifetime guarantee of a job and you no longer have to prove yourself for the problems.

America faces. Capitalism without bankruptcy is like Christianity without hell. America today has a grave problem. Too much consumption and too much debt, and the problem is addressed by borrowing more money. But when the borrowed money is again spent on consuming, instead of investing, the borrowed money does little good.

Jim Rogers sheriffs his opinion that a great collapse is needed for the American economy to get on its feet. Like Sweden, we’re in the 1990s the government resisted billing everyone out, and now after a few terrible years, the country has emerged as one of the soundest economies in the world. The Japanese government, by contrast, addressed the problem by propping up the country’s failing assets and extended the crisis a decade after decade.

This is the approach the U.S. has chosen to take. The author blends that on the incompetency of the people governing America in the last decades. He thinks they lack the financial knowledge and understanding of economics and chose the easy way out. The litigation makes us less competitive. In 2005 Roger’s fund Beilin became a victim of massive fraud.

Even though the management of the fraud had not done anything wrong. Jim Rogers personally was sued many times, and he was consumed by the whole thing for years. With this incident in mind, the author shares his thoughts on the litigation industry in America. This is how it works. Filing a lawsuit costs you nothing.

No matter how ridiculous your claim, you risk no financial loss, lawyers and liability suits work on a contingency basis, taking a percentage of what they win or settle for. They often settle since the defendant soon realizes that defending the suit will be far more expensive than settling it. The explosion of the litigation industry accounts for a significant part at the expense of doing business in the US.

The state of green costs of liability insurance, protecting oneself from lawsuits makes the U.S. economy less competitive. Thankfully for now, this is mainly an American phenomenon in the court. Systems in Europe are not so tolerant of nuance litigation land of the free. Not anymore. From the domestic surveillance called Homeland security to the tax compliance act factor, which makes it hard for Americans to keep foreign accounts and the double taxation that expatriates are subject to Jim Rogers.

Regretfully, things that the American citizens have seeded their rights to their government. Six China, the new great capitalist . On account of all these concerns. Jim Rogers shares with us. He explains why he chose Asia for residency. He is very excited about the future of China and the opportunities it provides.

Not withstanding the problems the country faces. This will be the next great economic power acting on this belief. In 2007 the investor moved his whole family to Singapore so that his daughters can learn Mandarin and speak the language like natives. One, here’s politicians in America railing about China’s coming.

His dictatorship in truth tryna has not had a dictator since the death and now is a dong. In 1976 the Chinese government changes automatically every five years, and no leader can serve more than two consecutive terms. To become a Chinese leader, one needs to spend 30 years working his way up through the ranks, being tested all along.

And then the leadership is held accountable. China has changed a lot is not yet the Netherlands, but it’s certainly opening up the Asian way is first to open up their economy, to bring prosperity to the country, not only after that to open up their political system, and this has proven successful in cases like Japan and Singapore.

The new Asian leaders are young people, educated in Europe, exposed to the outside world who come back to their countries and pour it all in. The author ends the book with the note, the winds of change are blowing. We are witnessing a great nations decline throughout history. Great empires have inevitably declined great Britain, Spain, and Portugal, and yet they’re still with us.

America is not going to fall off the face of the earth, but it’s time for a new great economic power. People need to accept it and act accordingly so they can take advantage of the opportunities that arise in times of change.

Credit: Read and Grow