Micheal Burry is probably the most interesting character to emerge from the credit crisis and one of the biggest winners. Burry identified early the horrible lending practices that were taking place in the United States and convinced Wall Street Firms to sell him credit default swaps on collateralized mortgages that Burry personally selected.
Burry is even more interesting because his career as a money manager basically started when he was given capital to manage by professional investors who followed Burry through his internet bloggings about what he was investing in. And also because he has a psychological disorder (called Asperger’s syndrome) which renders him (A) really uncomfortable in any kind of social situation so he avoids it. He lives his whole life essentially on the internet or with financial documents and (B) he has a great ability to concentrate in just raw data.
According to Bloomberg who interviewed Burry, today he (who shut his hedge fund)is investing in farmable land, small technology companies and gold as he hunts original ideas and braces for a weaker dollar.
Burry called the housing market today as being artificial, referring to the fact that between 2.5 million and 3 million homeowners are more than 9 months in arrears yet are not getting any notices to leave their properties. He said that 96% to 97% of mortgages today are flowing through Fannie Mae and Freddie Mac and that the private mortgage market is essentially non-existent. His opinion is that these two government entities are holding inventory from the housing market by not forcing foreclosures thereby propping up home prices.
As far as what interests Burry today. He believes that productive agricultural land with water on sight is going to be very valuable in the future. He isn’t buying agricultural stocks, he is actually buying the raw land. Burry disclosed that this is represents a significant portion of his portfolio although wouldn’t provide a number.
Interestingly Burry has also invested in some residential real estate. Again directly, and not through the stock market. He is also interested in gold.
I’ve written before about a company that is investing directly in farmland and indirectly in agriculture through a phosphate company. The company is called Sprott Resource Corporation and in addition to holding energy investments Sprott is building Canada’s largest corporate farm in Western Canada and is the majority holder of a phosphate project called Stonegate Agricom.
The huge corporate farm project is called “One Earth Farms”. The Sprott profile of One Earth Farms is as follows:
“The goal of One Earth Farms Corp. (“One Earth Farms”) is to become Canada’s largest fully integrated corporate farm. A true partnership between the private sector and First Nations, One Earth Farms represents a new model for North American farms. One Earth Farms is committed to becoming an industry leader by delivering superior results and a reduced risk profile through economies of scale, professional management and progressive farming practices.
One of the key focuses of One Earth Farms is building stable long-term relationships with First Nations through its commitment to improved land management, equity participation, job opportunities and training. Discussions are currently underway with more than 40 First Nations representing more than 2 million acres of land across Alberta, Saskatchewan and Manitoba.”
I found it interesting to find out Burry believes farmland is going to be very valuable going forward. It is something I also believe as the massive shift of the population of the emerging economies moves to a higher standard of living and demands more food and more protein based food supply. Oil and agriculture, two areas to really focus on in my opinion.
Here are previous articles I’ve written on both Sprott Resource and Stonegate Argricom:
http://www.gurufocus.com/news.php?id=106087
http://www.gurufocus.com/news.php?id=105760
Burry is even more interesting because his career as a money manager basically started when he was given capital to manage by professional investors who followed Burry through his internet bloggings about what he was investing in. And also because he has a psychological disorder (called Asperger’s syndrome) which renders him (A) really uncomfortable in any kind of social situation so he avoids it. He lives his whole life essentially on the internet or with financial documents and (B) he has a great ability to concentrate in just raw data.
According to Bloomberg who interviewed Burry, today he (who shut his hedge fund)is investing in farmable land, small technology companies and gold as he hunts original ideas and braces for a weaker dollar.
Burry called the housing market today as being artificial, referring to the fact that between 2.5 million and 3 million homeowners are more than 9 months in arrears yet are not getting any notices to leave their properties. He said that 96% to 97% of mortgages today are flowing through Fannie Mae and Freddie Mac and that the private mortgage market is essentially non-existent. His opinion is that these two government entities are holding inventory from the housing market by not forcing foreclosures thereby propping up home prices.
As far as what interests Burry today. He believes that productive agricultural land with water on sight is going to be very valuable in the future. He isn’t buying agricultural stocks, he is actually buying the raw land. Burry disclosed that this is represents a significant portion of his portfolio although wouldn’t provide a number.
Interestingly Burry has also invested in some residential real estate. Again directly, and not through the stock market. He is also interested in gold.
I’ve written before about a company that is investing directly in farmland and indirectly in agriculture through a phosphate company. The company is called Sprott Resource Corporation and in addition to holding energy investments Sprott is building Canada’s largest corporate farm in Western Canada and is the majority holder of a phosphate project called Stonegate Agricom.
The huge corporate farm project is called “One Earth Farms”. The Sprott profile of One Earth Farms is as follows:
“The goal of One Earth Farms Corp. (“One Earth Farms”) is to become Canada’s largest fully integrated corporate farm. A true partnership between the private sector and First Nations, One Earth Farms represents a new model for North American farms. One Earth Farms is committed to becoming an industry leader by delivering superior results and a reduced risk profile through economies of scale, professional management and progressive farming practices.
One of the key focuses of One Earth Farms is building stable long-term relationships with First Nations through its commitment to improved land management, equity participation, job opportunities and training. Discussions are currently underway with more than 40 First Nations representing more than 2 million acres of land across Alberta, Saskatchewan and Manitoba.”
I found it interesting to find out Burry believes farmland is going to be very valuable going forward. It is something I also believe as the massive shift of the population of the emerging economies moves to a higher standard of living and demands more food and more protein based food supply. Oil and agriculture, two areas to really focus on in my opinion.
Here are previous articles I’ve written on both Sprott Resource and Stonegate Argricom:
http://www.gurufocus.com/news.php?id=106087
http://www.gurufocus.com/news.php?id=105760
