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How did you get into investing? Well, completely by accident. When I was in my final year of university, I went on interviews just to see what it was like. Companies came to my university and conducted interviews. I went there. One of the guys turned out to be from Wall Street. And we liked each other.
He was from the Bronx and graduated from Harvard. I was from Alabama and graduated from Yale . So we found common ground. He offered me a summer job on Wall Street. I knew nothing about Wall Street. I knew something bad happened there in 1929. I knew it was in New York, but that was all I knew. But he liked me, and I liked him , so I took the job and fell in love with it.
I didn't go to law school. I didn't go to medical school. I didn't go to business school. I went to Wall Street as soon as I could. And here I am, unemployed. What do you think made you interested in investing for so long? Well, I realized very quickly that this place ... I mean, I was extremely interested in the world and what was going on in it.
Current events, if you will. And here was a place that would pay me, and pay me a lot, for knowledge about what was going on in the world . I couldn't believe it. I couldn't believe that such a place existed in the world. So I didn't go to business school or anything. I went to Wall Street as soon as I could.
And here I am, unemployed. You came to Wall Street from a small town in Alabama and ended up at Yale. How did you do it? I was in a school club for boys called the "K Club." And for some reason in those days, I think, because Yale was trying to attract weird people like me. And I got a scholarship. Oh my god, what now?
What should I do now? So I was really excited and went to Yale. Not my level at all. It's not within my competence at all. But I had a great time. So, you went to Yale, got a job on Wall Street. What made you fall in love with it? Well, I knew nothing about Wall Street. I thought stocks and bonds were the same thing .
I didn't even realize that I had a huge passion for what was happening in the world, current events, call it what you will. And I suddenly realized: this is a place where I will be paid, and paid a lot, if I do everything right, for knowing what is happening in the world. I couldn't believe it. I mean, I was planning to go to law school or business school.
I was just as confused a student as anyone else. But here was a place where I would be paid to know what was going on , and that's exactly what I loved. So I didn't go to business school. I didn't go to law school. I went to Wall Street as soon as I could. And who did you learn from to become so successful in investing?
Well, the market is a cruel, very cruel teacher, I assure you. I remember, at some point in the beginning, I felt like a genius. Everything I touched was right. I couldn't believe it. I said, “Well, it’s really simple. I will be the next Bernard Baruch." Do you know who Bernard Baruch is? I am not. Well, he was an incredibly successful investor a hundred years ago on Wall Street.
Whatever it was, I said, "That's easy." And, of course, somewhere, I don't know, two months later I was completely destroyed. I lost absolutely everything. The market showed me "how smart I am." The market showed that I wasn't the smartest guy in town, even though I thought I was. So, after what happened, what made you try again?
I had no choice. I have nothing left. There wasn't a single penny. The little money I had was completely lost. So, what was left for me to do? I guess I could have killed myself , like some people do. I guess I could have gone to business school or something , but I wasn't interested in that, so the only thing I could do was, oh my god, start saving money and try to start over .
So, you start again, as many people have done in the past, but many fail in investing and lose money again. So what did you do differently after that first bankruptcy that allowed you to become a true pro? Well, I realized: that first loss, that first disaster taught me that there are many people in the market who don't know what I know.
I just assumed everyone knew the same thing as me. Well, I quickly found out that there were a lot of people who did n't know as much as I did, and maybe I knew too much, or maybe I was wrong about what I knew. But anyway, I realized, "Oh, I have to consider all these other people." All these millions and millions of other people in the market, because they don't know what I know ; Regardless of whether I'm right or wrong, they have different views and I have to understand that.
So when you learned that all these millions of people had different views, did that mean you wanted to make different bets, manage your risks better, play it safer? How has this changed your approach to investing? Well, I mean, when I did it the first time, I was...everything I did turned out to be right in the end , except that at first I lost everything.
But the market went against me because I knew nothing about the market, its fluctuations, and the emotions of other investors. So I quickly learned, " Okay, I have to realize that there are millions of other people who are doing this, and they don't think the same way I do." They don't know what I know.
I'm not saying I was right, I'm just saying they had different views and I realized I had to take that into account if I was going to be in the market. I had to learn to adapt and take into account other people's views. Regardless of whether they were right or wrong, I had to understand that there were other views in the market that differed from mine.
You mentioned 1929, for example, you've gone through numerous market cycles like the dot-com crash, 2008, the COVID pandemic, and I'm sure many others in between. How do you change your thinking when you believe the fundamental value of a product or stock is one, but the market believes otherwise? Well, I realized that yes, I was right.
I was doing everything right, finding out the real value of something and what was happening with the company or product. But then I realized, "Oh, but wait." " Yes, I have to think about all those other people too." Because they may think differently. So, the main thing I had to learn was to find out or understand what other people were thinking and what they were doing.
And because I knew it would affect the market. I repeat, at first I just assumed that everyone knew what I knew. And as soon as I realized, “Oh no. They have their own knowledge, their own views, they will think and act differently than I do." And I had to understand that. And how did it change your actions when you realized this?
Are you following the crowd? Are you going against him? Do you let this influence your view? For example, what do you practically do differently knowing that the crowd might have a different view? Well, I learned that it's okay to have an opinion that differs from the crowd. But I also realized: wait, you better find out what they're thinking and what they're going to do, because it will affect the price.
If you think something is worth 20 and they think it's 50, you better be careful because there are more of them than you and they will influence what happens to you. So I realized that I had to consider prices, which I hadn't really thought about before. If something was selling for 20, I thought, “Okay, I know everything there is to know.
Okay, the price is 20. I knew everything. Good". But then I realized that there are millions of other people who don't know what you know. Whether you are right or wrong is irrelevant . They have different views, they don't think 20 is the right price, and it will affect the market. What did you learn about human behavior and psychology when you started investing, especially when you first lost all your money?
Well, I learned that all investors are very much influenced by emotions when investing. You've heard the saying about fear and greed. Well, we all get very scared and extremely greedy when we enter the market, and I've come to realize that most people invest based on emotion. That is, if you're at a bar on a Saturday night and everyone is saying "blah blah blah", that's one thing.
But I realized that "blah-blah- blah" may not be reality. Now it didn't matter that I knew the reality, because if they all said that "blah blah blah" was the reality, they would act on it, and it would become the reality . And I had to realize that the price would reflect "blah- blah-blah." It wouldn't reflect what I knew.
And I had to learn about prices and markets. I didn't know much about markets before. Um, so I realized I had to study markets and prices. One of the interesting features of markets is that over long periods of time, the market can be somewhat irrational . And we see this in the example of many companies recently, where business valuations significantly exceed profits, or they may even operate at a loss.
And yet people believe that it can change the future, so they invest in this business. So, most people think the same thing, perhaps overvaluing the company more than it's worth. How do you know when the music stops and you think, even though all these people think differently, I think differently, and this will be the catalyst that will change the course of events?
Harvey, great question. You want to get rich. If you can answer that question, that's all you need to know . It's that simple. It's that simple, Harvey. But that's an impossible question, how can you be sure if you don't know it already? Harvey, go to any restaurant on a Saturday night and talk to someone about this and that, and you'll quickly realize: you think you know everything, and maybe you know everything about the company, but you quickly discover that there are a lot of other people who also think they know everything about that company.
And what they think is right is different from what you think. And they will act, and there are more of them than you. And how they operate will have a big impact on the price. You often went against this thought when you were sure that what you believed was different from the same "blah-blah- blah," as you call it.
When you had such defining moments in your career, what gave you the confidence to believe that the crowd was wrong? Well, I'll answer with just one: a huge amount of research . I used to do a lot of research on any industry or company I invested in, and I still do. But the more I knew, and especially in moments like these, it was wonderful to know that I was right.
But I also had to learn that just because I was right didn't mean I got the price right, because there were millions of other people who might have had different views, and they influenced the price more than I did. Investing has become more complex over time as more and more people learn how to invest.
We're seeing the rise of quantitative investing, and there's so much money in the world that it's becoming more of the same " blah blah blah," as you call it, because with such huge amounts at stake, there are so many opinions going in different directions. What is the best way for a young person in 2026 to learn how to invest?
Should young people enter the market now? Well, I don't know which way to study is best. I must have done this from my own experience. I would call it practice, trial and error, for lack of a better term. I learned by learning everything I could about a particular industry or company. And then he had to learn, "Wait a minute, that's not enough." You also need to understand that there are millions of other people in this market, and they will have different views than you.
Let's say a company is selling at 80 times earnings, and you know it's going to collapse. That's good. I am proud of you. But you have to understand that these millions of other people may not know that it is going to collapse, as you do. They believe it is almost the best invention of all time. And they will push the price higher and higher because they will think you are crazy.
They think...they think I don't know what I'm talking about. I don't know what I'm doing. Look at this guy, he has no idea what he's talking about. Buy more, buy more, buy more. And they buy. And eventually, the moment comes when everyone understands everything. But that “ eventually” may be a long way off, and until then, there may be a lot of pain.
So you're saying that it eventually happens, but at the beginning you were talking about how your view when you first went bankrupt was ultimately proven correct. That's right, you had your view, your conviction, you invested money in the market, and the market went against you, and you lost all your money.
So how can investors balance conviction and belief in their ideas and having their own opinion, even if it goes against the market, and not lose all their money ? Well, you want to be rich, right? Me too. And I have nothing against being rich. I want to be rich too. But if you are going to become an investor, you have to learn or realize that there are millions of people who will likely have different views than you, and there are more of them than you.
So you have to find a way to find out what they're thinking, to understand it. Because it will affect the share price, if it's a stock. This will have a huge impact. And you need to find a way to find out what they are thinking and what they are going to do. You can figure out that they are wrong, and that is how you can make a lot of money if you have the stamina and if you can tolerate the pain.
But you have to learn this about markets if you're going to work in them. Because no matter how smart you are, there will always be people who will think you are wrong and act differently. And this will have a huge impact on the price, and therefore on you. How do you decide whether to stay in a trade when the market is against you or just get out?
Oh, great question. Some people I know have automatic exit points. In other words, let's say a stock or position goes against you by 15%, or some other number. They automatically close a position if it goes against them by 15%. Which might be a good rule. It would definitely help me at certain times.
And I don't have anything like that . I just sit there, and when everything goes against me, I do more and more research to prove I'm right, I endure more and more pain, and finally, when the pain becomes unbearable, I give up and cut my losses. But I try, try, try to figure out if I'm right before I do it.
There were times when I even knew I had to cut my losses because there were more people in the market who thought they were right than I was. When you're in a moment like this, how do you deal with your emotions? Everyone around you says one thing, you do the research, you believe another, and it may take weeks, months, or longer for it to actually come true.
How do you keep your sanity ? Oh, Harvey, I don't know. If I had it easy...I'd just say, "Hey, okay, ring the bell." Ring the bell. I, I repeat . I go back and check my work. I'm checking my work. I check again and again to see if I'm right. And even if I'm convinced I'm right, I still have to consider all the other investors who also think they're right, and I have to learn to deal with that .
I don't have a simple answer. I wish there was. I told you that some people have an automatic rule. If the deal goes against me by 15%, they reverse the position or something. I don't have such a rule. Maybe it would be worth it. This would have helped me more than once. But no, I do n't have such a rule.
My only rule, my only way, is to check, check, and check again. I try to tolerate the pain, and if it becomes unbearable, I change position. So, we've discussed many of your investment theses in quite some detail: how you approach investing, how you maintain confidence, how you become a counter-trainer, and how you manage your psychological state , even without a strategy.
But later you co-founded the Quantum Fund with George Soros. Where did the idea to create your own foundation come from? Well, Harvey, first of all, that was a hundred years ago. This was before you were born. Before your father was born. You were new to this business. You're not, he's only a few years older than me.
But even back then, the most effective way to be an investor was to have a hedge fund where you get a percentage of the profits, and that's a great path to success if you're right, and we both thought we could be right and we would be right. There were few hedge funds back then. I mean, there are millions of them now.
In those days, this was a very rare and unusual phenomenon. But we decided to create a hedge fund together. We started working and we had an office there. We had a secretary. There were three of us in the office. I started this fund, we took a percentage of the profits, and luckily it worked. How was it for you working with George Soros?
Yes, that was a decade ago, how would I know? You know, all I can say is—we worked well together. What he thought and what I thought matched very well . He understood the markets better than I did. And I was better at research than he was. In simple terms: he was engaged in trade, and I was engaged in research.
And it worked. When you were both very young and creating this foundation together, where did the desire to become truly successful come from? I think you should ask his parents. You should ask my parents. I don't know. I mean, I was young, he was young. He was the son of immigrants. And I'm a guy from the backwoods of Alabama.
I don't know. Whatever happened in our lives, it was this that made us strive for success. How did you and George make such high profits? 4200% from 1973 to 1980. This is extraordinary. Well, looking back, yes, it was extraordinary, but it was hard work and passion. I don't have a good answer, except that we both loved what we did.
We both lived by the markets. And we did the right thing. Do you think this is possible today? I know it's possible. Could I do that ? No, of course not. Not now. Too lazy. But no, if you find the right people with the right mindset and drive, of course they can do it. I didn't say it was easy. I didn't say it was likely, but I know it's possible.
So what advice would you give to someone who is just starting out , who wants these results, is willing to work, and has the talent for it? Well, first figure out your passions. If you really, truly love the markets—this is the first step. And then, if you can understand whether you have the ability, whether you are a good trader, investor, or someone who has the necessary qualities, then it is worth acting.
But you also have to prepare for failure, because there will be times when the market will go against you, no matter how skilled you are, and you will have to find a way to deal with it . What to do. What to do when the market goes against you. And I don't have a simple answer. What was it like having Scott Bessant as an intern?
Well, Scott was he was from the South and went to Yale. I was from the South and went to Yale. We had this in common. He was going to go into journalism, but for some reason he decided to try his hand at finance, and I took him on as an internship. He knew nothing about investing, but he wanted to...He was eager to learn.
Perhaps the main thing I remember is that he was enthusiastic , wanted to learn, and was willing to do anything for it. Is it strange to see him in the position he holds now? Of course, it's strange. I am happy when anyone achieves success doing what they love. It doesn't matter who it is or what it is .
Yes, that's always great. You have been a mentor to a huge number of people for many years, on whom you have had a great influence. How have you managed to achieve such success in your own investment career and at the same time teach others to do the same? Well, I didn't know how to teach at all. The dean, I met the dean at a party and he said, "Oh, come teach a course for me." And I replied: " No, you're kidding." " Business schools are a terrible waste of time, and I wouldn't make a good teacher ." But, for some reason…oh, I know it was.
I wanted to use the Columbia University gym. But I didn't study at Columbia, but I knew that if I was going to teach, I would tell him, "Okay, I'll teach you one course, one semester, for free, if you give me lifetime access to the gym." To my surprise, he agreed. So I went to teach. But what did I know?
I knew nothing. But it turned out that I really liked it. The students liked it , we liked it, we were all delighted. So I continued teaching and got great pleasure from it. What did I know? I knew nothing. But I knew I liked it . What was your approach to teaching? Well, my approach was… since I didn’t have a PhD or an MBA, I decided to train them as if they had come to work for me.
I said, “Okay, guys, you came to work for me. You are my research department, and now you have to tell me what to buy, what to sell, and why.” And I constantly...do you know what a Socratic dialogue is ? I kept asking them questions. Remember Socrates? Yes. Socrates was quite… you know what happened to Socrates?
You know, they gave him poison. Um, but I kept asking them questions. It was just questions and answers, questions and answers. I asked questions, forcing them to question everything they thought. And how did you encourage them to form the right approach when they were your researchers at Columbia Business School?
Well, that was my class. I could do what I wanted. Fortunately, the students loved the course, and so did the Columbia University administration. As a result, I simply told them, "Okay, this course is structured as if you're applying for a job with me, in my research department , and now you have to tell me what to do, and I'll ask you 'why'." And it worked.
Because no matter what they said, I was experienced enough and knew enough to ask them lots and lots of questions, so there was an ongoing dialogue that produced results. And what distinguished the best students from the rest? Well, I mean, you know the market. Everything you need. What makes it different?
If the stock is going up, then you are already different. If stocks go down, you are different too. The market itself will distinguish you. And what did you teach them about how to find profitable investments? Well, I taught them that they should read everything. They had to check everything. If the company told them the sky was blue, they had to go to the window and see if the sky was really blue.
They had to confirm everything themselves, because many people think something is correct but don't know for sure. I mean , a lot of people— I'm not saying they lie. They simply believe they are right. Many people make mistakes, and I tried to explain to them that most people in the market are wrong.
They don't know they're wrong, but you need to go and find out the real state of affairs to know who's right and who's wrong. Do you find out reality by talking to people? How would you have done it before the internet? Well, newspapers have been around for most of my life, and even longer. Newspapers, radio, television, telephones.
There were many ways to find out— I mean, you could read the annual reports, and I made them read all the annual reports, the 10-K forms, and other documents. All sources of public information about the company or industry. And then compare what the company said, what others said, and whether they had confirmation of reality.
Confirming reality is never easy. Nobody wants to hear the truth about reality. They want to hear simple answers. By the way, I want simple answers too, but it doesn't work that way. How can people avoid the natural human tendency to take the easy way out? Well, you ask me how to be an intelligent person, how to be Socrates, how to ask the right questions and how to get the right answers.
The right questions are important, but the right answers are even more important. You just have to keep asking, questioning, and questioning. Always continue to doubt what you are told until you are convinced that you have the right answer. I didn't say it was easy. I wish it were so, Harvey . It's never been easy for me.
What were the most surprising things your students taught you about investing? Well, I don't know if it's strange because I had already had experience at that time, but I guess the point is that everyone accepts what they are told. If you open a newspaper and it says the sky is blue, very few people will go to the window to check if it really is.
But everyone will agree, if friends at a restaurant tell them the sky is blue, or the newspaper writes about it, most people just believe it. And I've learned in life: don't take it on faith, because it's probably not true. When you're trying to figure out if the sky is really blue, how should people act?
Especially when there are so many different sources from so many different fields today. Therefore, it can be difficult to fully know whether the sky is truly blue. I told you it wasn't easy. This is not an easy way to make a living. I assure you. This is a very difficult way to make a living. You must, as in my case, read, read, and read.
Talk to as many people as possible to find out the truth: you need to talk to customers, competitors, suppliers, employees, former employees. You just have to talk to many, many people. And even then you will make mistakes. At least I'll make mistakes. I want to move on to discussing the current state of the world.
And I want to ask you what you think are the biggest investment opportunities in the world right now. Well, most of the world is updating its highs. Almost every stock market in the world has reached a new high in the past few days or weeks . Almost everywhere. This is a rarity in history. So this is unusual.
And it probably means something is going wrong. Because we all want to be happy, successful, and rich. But the world is different. People are made differently. So I think the main thing for me right now is what will go wrong, what we haven't figured out yet. Because it's very rare for everything to go perfectly.
This has happened extremely rarely and is unlikely to last long. So what will go wrong and what should I do about it? And what deals do you think people should pay attention to? Well, people are convinced that everything is great. And that every stock market in the world should be breaking new highs.
They must draw their own conclusions. The main message I can give them and everyone else is: don't listen to anyone. Don't listen to me. You have to figure it out for yourself and make your own decisions. Of course, I can express my opinion, but I strongly advise you not to listen to me or anyone else.
The only way to success is to figure things out on your own and make your own decisions. What is your opinion? Well, I repeat, almost every market in the world has renewed its high in the last few days or weeks. This rarely happens. And that should indicate that every country in the world is doing everything right, and that everyone in the world is doing everything right, and everything is great.
But I know enough history to understand that this is probably not entirely true. It is rare for everyone to be right about the same thing . So you have this perspective, how do you translate it into a deal so you don't lose everything? This is one of those examples we've already talked about: when you have your own opinion and you see what color the sky is, but everyone else thinks it's a different color and dances to that tune .
Well, again, you have to understand that if everyone thinks the sky is blue—yes, that's great. Look out the window and you will see that the sky is not blue. But Harry, if everyone thinks the sky is blue, and they all tell each other it is blue, then that is part of the situation. You have to understand this, and you have to put all this into your brain—into my poor, pathetic brain—and figure out what effect it will have.
Because even if everyone is wrong, they can make their point of view right at least for a while, because there are so many of them, and you have to understand that. I hear a lot of investors, especially hedge fund managers today, talking about the idea that when you compete in the markets, it shouldn't be the number one hedge fund manager in the world going up against the number two.
It should be like the number one hedge fund manager in the world going up against a rookie. And you hear this a lot because people who want to make big profits, instead of competing with each other, should look for areas where other people are not. So, with that in mind, how should this affect how people make investment decisions ?
Well, I don't think that in order to understand whether a person is right, it is enough to simply evaluate their experience in the market. Facts are facts. You may be the dumbest person in town, but if you guessed it— hooray, you guessed it, and your stock will go up. You can be the smartest person in town, but if you're wrong, the stock won't do what you hope.
And other investors have to figure out who is right and who is wrong. However, I don't have a simple answer. If only there was a simple answer. Wouldn't it be great if there was a simple answer? Wouldn't it be great if all I needed was luck? Oh my god, I would be happy to have the chance. What a wonderful thing that would be.
If only I could just find luck, but I never considered that a way out. Can you give me some luck, Jim? I wouldn't give up on luck, but I've learned that relying solely on it is not an option. How do you balance between realism that understands that luck alone is not enough and optimism that believes that deals will eventually work if the process is right?
Well, I can only answer one thing: you need a lot of experience. Yes, it would be great if everything depended solely on luck. Uh, I already said that at the beginning of my career I had huge percentages of profit, while everyone else went bankrupt. So I thought it was easy and I knew what I was doing.
The market quickly showed me that I did n't understand anything, and I lost everything. Uh, and even though I did everything right for a while , the market taught me, "You're not that smart, kid." Be careful. "And the market taught me that. And the market teaches me that every day when I get too cocky.
What is your view of China and how its system of governance has changed over time? Well, I mean, China is one of the few, if not the only, well, certainly one of the few countries that has had periods of greatness that have been repeated. I mean, Rome was only great once. Egypt was only great once. But China has been great three or four times.
China has fallen apart three or four times and has had a few disasters. But for some reason, when China has a disaster, after being at the bottom for a few decades, they rise back up . I don't know why, Harry. If you know the answer, please don't announce it on the air. I want to find out for myself.
And I haven't found out yet. But they seem to be rising again. And it looks like China is going to have another period of leadership, whether we like it or not. And obviously there are a lot of things like the United States has compete with China economically? First of all, they should not try to fight.
They should try to cooperate with China so that we can all get rich together. That's great. I mean, I want to be rich, you want to be rich, so let's get rich together. Sure, we can fight and get rich, but it's better for us to work together to get rich together. That's the best way. And that's what the US and China should do.
Unfortunately, history shows that we're all human, and humans don't usually do that. They usually get emotional, get into fights, arguments, arguments, and problems. But the idea should be for China and the US to work together and get rich. Everyone gets rich together. What's your opinion on investing in China?
Do you think investors should take a closer look at this ? I think investors should look for cheap assets where there's change and improvement. So if you can find in China cheap things that are getting better, do it. Do it. Do it. But if you can't find it in China, find it somewhere else. It doesn't matter if it's Ethiopia or Canada.
Just do it. That's the key to success. Find things that are cheap, where positive change is happening. Do your research, make sure you're right, and then invest. Are there any industries in China that you really like right now ? Harvey, yes, but I mean, even if I say that travel, for example, has a great future in China, because the Chinese have n't been able to travel much for many years.
But now China is opening up. There are over a billion Chinese people. They want to see the world. So, yes, I would suggest that travel, tourism, whatever you want to call it, has a great future in China. But please don't listen to me. Please find out for yourself what you know. Do your own research and act.
The listeners will certainly use their own opinions. I mean, this is more for entertainment and learning, but it would be great to hear your perspective so that people can take this as an indicator for learning, not as investment advice. Well, okay, I'll tell you. China probably has a great future. Agriculture probably has a great future.
You sound like a well- educated person, but I'm sure most of your classmates haven't become farmers. Nobody has become a farmer in the last many years, for many reasons. Farmers all over the world are getting older, retiring, dying, or doing something else. So the world is left without farmers. There are some major changes happening in the world that could lead to new opportunities.
I don't know if you can drive a tractor or Harvard, but maybe you should learn, because everyone wants to go to business school. Nobody wants to be a farmer. That might suggest something or lead to an opportunity. So you think that there are often many opportunities where people don't look? That's usually been the case for most of the world's history.
You know, remember Christopher Columbus? This The poor guy was an idiot. He was a fool, and nobody wanted to listen to him. But he realized, "Huh, maybe something is going on." And the rest... you know the rest of the story. He was right. What gives you the confidence to look for opportunities when people look the other way ?
Just a lot of experience and research. Yes, if I get a crazy idea, I know I have to do a lot of research to confirm it. But if I do enough research to make sure my idea is right, then I can act. That doesn't mean I don't make mistakes, but at least I can act. What is your opinion on how Venezuela has changed in the last few years, and what investment opportunities do you think there are in that region?
That's a very good question. The problem is that I don't have a good answer, because the American army recently took over Venezuela. Venezuela is a defeated and occupied country. It depends on Washington more than anything else now. Yes, they have huge oil reserves, and I have a view on oil, but they could be wrong because they are now occupied by the Pentagon.
And the Pentagon doesn't know any better than you and I do . So the possibilities are great, but I do n't do anything in Venezuela because I don't know what's going to happen in Washington. What's your view on oil? Well, I'm optimistic about the price of oil. I know that the known reserves of oil around the world are dwindling and have been for a long time .
So the world is running out of known reserves of oil. So I'd rather own oil than play it down. What about other commodities like gold? Well, I own gold. I own silver. If it goes down, hopefully I'll be smart enough to buy more. Whether we like it or not, Harvey, do you remember Jesus Christ? Jesus Christ was sold for 30 pieces of silver.
Because even then, silver had a tremendous value. It still does. Silver and gold have tremendous value everywhere and probably always will. Of course, there will be times when their price drops. That could be an opportunity. I own gold and silver. Hopefully I'm smart enough to buy them up if the prices are low.
How do you determine the value of something like gold and silver when there's no underlying return, like stocks? Well, I'll repeat myself. Silver and gold have had fundamental value for centuries. That's pretty much all I know. How do I know the right price? I don't know. But I know enough about markets to know that when they're depressed and neglected, it's probably time for me to take a closer look .
How do you assess the changes in the Middle East in recent years, especially given that there are a lot more wars going on in the region, at least often shown on television? Well, if you can figure out what's going to happen in the Middle East, you'll be very successful. I don't know. I know that in the Middle East, a lot of people want to fight each other, and they've been doing it for centuries, at least for decades.
And I'm afraid that it's going to continue. If I were there, I would sit down and say, "Let's all get a bottle of wine, eat, drink and have a good time." But they won't listen to me. They've been there for centuries. And unfortunately, they're just people like the rest of us. And people get angry at each other and get emotional.
And I'm afraid that it's going to continue. Do you think this war could change their relationship with the West? Maybe. Of course it could. Of course, it probably will. I mean, with every new war, people get angrier. Assets are destroyed, people are killed, it affects a lot of countries and a lot of people.
That's history. That's human nature. How do you learn from history to understand the impact of this on investments? Well, if a major war breaks out, it's usually bad for markets almost everywhere and for most people. So, Harvey, if the hostility deepens and a major war starts, learn to play the bearish.
Find out what will be profitable. Think about buying silver. Think about buying wheat, because economies don't like war. Some people like war. Some people get rich from it. But most people don't gain anything from war. What do you think about the Russian- Ukrainian conflict ? How do you think it has affected Europe and the rest of the world?
Well, the same thing. Harvey, Russia has been around for a long time. I've been to Russia several times. I've invested in Russia more than once. If you do it right, you can get very, very rich. Harvey, if you like to dance, go to Moscow and drink vodka. They'll all dance with you, I promise. They'll all drink vodka with you , I I promise.
You'll have a great time. Just be careful. First, make sure you know what you're doing. Let's say you're in your early thirties again, you're gaining experience in investing, and there's so much geopolitical trouble around, and you're testing and retesting your investment thesis, trying to figure out if the sky is really blue.
What would you do in such a situation? Would you fly into a war zone? Would you talk to the locals to find out what's really going on? Well, it depends on the circumstances, but that's usually what I did. Yes, I learned to go there and find out for myself what's going on. Don't listen to the newspapers, don't listen to the TV.
See what's happening with your own eyes and act accordingly. Because losing money on an investment is one thing, but going to a conflict zone can be a life-threatening situation. So how do you stay calm when you find yourself in such dire situations? Well, then the answer is probably simple: don't do it.
It's better to go to a bar on a Saturday instead of to go to Ukraine. Just do your homework, be careful what you do. You don't have to go everywhere just because there's a war going on somewhere, you don't have to go. You can do something else. But if you think there might be an opportunity there, you should go and check it out.
Harvey, let me repeat after you. Let me repeat. It's not easy . It's definitely not an easy way to make a living. At least for me, it's never been easy. We've seen over the last few years that there are a few businesses in Europe that are worth $10 billion to $100 billion, but in the United States there are a huge number of companies worth over $100 billion and even trillions of dollars.
What do you think is the difference between the United States and Europe that has allowed the United States to leapfrog so much in recent years? You talk about maybe you could write a multi-volume history of the world and explain the difference between Rome, the United States, you know, there have been many successful nations in history.
Every of them had circumstances at the time that made them successful. But, Harvey, there's no easy answer. The fact that Rome was successful once has nothing to do with the fact that Britain was successful once, and it certainly has nothing to do with who will be successful in the future. That's something you need to figure out.
And when you figure it out, please send me an email. Do you think regulation is the main factor that sets them apart? What has allowed the United States to have so many more successful businesses? Well, history certainly shows that countries that are overly regulated and controlled are generally not as successful as countries where people are free to do whatever they want.
Animal instincts, as they are sometimes called . If people are free to act, they are often more successful than those who are tightly controlled and constrained in their actions. So a country like Great Britain, for example, which was a great power many years ago, and has now left the European Union.
How do you think that Can Britain be great again? The simple answer, I repeat, is what I said before. Get rid of the controls , get rid of the regulations and tell people, "Go ahead." Be successful. Find something you love and want to do and do it. And we're not going to help you, but we're not going to get in your way either .
"And if you can unleash the ' animal instincts', for lack of a better term, if you can unleash those instincts in a country , you're probably going to see successful people. History shows that. How do countries get people to buy into that message? For example, in the US, at almost every sporting match, at many graduations and big events, people sing the national anthem with great pride, they carry their flag everywhere.
In the UK, we have our own national anthem, but it's not as important to people as it is in the US. Is that right? The values that the US represents seem to be bring people together, no matter how divided the country has become . Whereas in the UK, there's often a lack of that sense of community and unity that I think there is in the US.
What has history taught you about how a country can bring its people together to love their country, to fight for it, both metaphorically and physically? Well, Harvey, you've asked a question that historians have been asking for hundreds of years. Why was Spain once great? Why was Rome once great? Why was Britain once great?
Try to figure it out. Figure it out, solve the world's problems, tell me what's next, and I'll go there. What does your gut tell you ? You've had more experience reading and studying this than most people. Well, the main thing is the freedom to do what you want. I mean the lack of restrictions . Governments that don't try to control everyone and tell them what to do.
Those are the countries that tend to produce successful people. people who want to achieve something and are allowed to do it, so they become successful. So I think the less restrictions in a country, the better. Historically, that's what shows that those countries are more likely to be successful. There's a funny thing: often, if you do less, you do more, and if you do more, you do less.
You mentioned that overregulation leads to a decrease in "animal instincts" and the freedom to create businesses. But actually, giving people more freedom encourages them to do more great things, and it's a very interesting observation that I've made in my own life: sometimes you just have to trust the process.
Well, if you trust people and you know enough about history, you know that there are going to be a lot of bad people and a lot of people are going to make mistakes, but there are also people who are going to be obsessed and crazy, and they're going to be very successful if you let them. But if you tell them what to do, they're not going to be as successful.
But if you tell them what to do, they're not going to be as successful. to everyone here: find something you love and do it, and you'll probably do great things . The United States is now at $40 trillion in debt. How will that end? Well, it's pretty simple. The United States is not the first country to be in debt ; history shows that countries that get into big debt eventually run into trouble.
This is not just an opinion, this is a simple historical fact. Check it out for yourself. 100 years ago, Britain was the richest and most powerful country in the world, but they got into huge debt and went bankrupt. Margaret Thatcher was elected because they were bankrupt. She had to try to save them.
By the way, Margaret Thatcher did a lot of great things, but she also became prime minister when the North Sea oil was being extracted. So, how are you guys doing? Give me the biggest oil field in the world and I'll give you a good time. We'll have a great time. Just give me one or two huge oil fields.
But Margaret Thatcher did it. I mean, she knew that England had once been great, but then it was constrained by politics. She opened up the country, and Britain started to succeed again, because she let all those men and women do what they wanted to do, and they did. How did the United States get out of its debt problem?
Well, historically , the United States is not going to get out of it without a problem, without a crisis. I mean, history tells us that there have been very few countries that have gone into debt and just gone on and started over . Most of them have to go through a crisis: whether it's a war, or a depression, or a massive bankruptcy—something goes wrong, and the country has to suffer.
So if you can find a way to get rid of the debt—hooray. You've saved the day. But the countries throughout history that have done that have eventually run into problems. And I mean, so have families, companies, people, individuals—all without exception. I think it's quite difficult because both sides of the political spectrum, both Republicans and Democrats, in order to get elected or re-elected, have to make promises to the people that prioritize short-term benefits; and so neither side really wants to address the debt problem, because then they're going to have to cut spending in areas that affect millions of people across the country.
So do you think there's a way for politicians to make people face the truth , or is it just going to happen, unfortunately, and people will react as they go along? Well, I mean, you just explained it yourself. Sure, let's say some politician says, "Okay , guys, we need to tighten our belts." " We need to do something ." And everybody says, "Yeah, let's do this." But I promise you, in a year or six months, people will say, " Come on, Harvey.
I did n't think it was going to be this bad. You did n't say that It's going to cause so much pain and suffering. I don't want to do this anymore ." They'll give up. Yes, you'll get elected, you'll come into power triumphantly. But when you actually start doing it, you'll just be finished. People will shoot you.
I don't want pain, nobody wants pain. But to solve a problem, you have to suffer pain. I think it's very much a basic human psychology, where people think you can have your cake and eat it too . But sometimes , just like you said in your investment career, there are times when things get really tough, whether it's because the market is going against you or because of the hard work that you've had to do.
Do you think people can change their psychology to face the truth ? Is it something that has been the same for thousands of years and will be the same for thousands of years, and those who can discipline themselves to accept reality and see if the sky is really blue will stand out ? Well, Harvey, I'll repeat myself .
Let's say you're running for president of the United States and you explain everything to everyone. Everyone will say, "This man is right." And you'll get elected. But then you'll start taking action. You'll start taking the necessary steps. What do you think will happen in six months or a year ? You think everyone will say, " Well done, Harvey.
He's just great. I don't have a job and my kids are hungry, but he's great. He's solving the problem. Hooray, Harry." I'm not sure that's going to happen . I suspect someone will come and shoot you in the back of the head. So what are you going to do then? Do you just keep pretending that everything is fine, or...
Well, that's always the case. and it has happened throughout history. I mean, Spain was once rich and powerful. Then they went bankrupt. And once upon a time, Portugal, believe it or not, was extremely rich and influential throughout the world. But then they went bankrupt. Great Britain, 100 years ago, had no equal.
But then they went bankrupt. Now Washington says, "We're not worried, we understand everything. We'll take care of it." But no one in history has ever been in such a situation and come out of it without any problems. What do you think about Scott Bessant's words that he is now the boss of the house?
Well, he is the Minister of Finance. That's all he means. I don't think he's saying, "Don't worry, I have all the answers." He just says, "I'm in charge now." And that's true. But at the same time, Stanley Druckenmiller wrote against him or repeatedly pointed out that he didn't necessarily have the purchasing power to really compete with the market.
Well, I mean, he usually has to…You asked people. I'm just telling you the story and the facts. And the USA is the largest debtor country in the history of the world. And history suggests that even if you're Scott Bessant, that can be a problem. What do you think about the growth of these mega-hedge funds with assets in the tens or even hundreds of billions?
And do you think they will be able to achieve high profitability at this scale? Well, I mean, history shows that if they get too big, they usually have problems. I'm just telling you what people are like . If people become too successful, they usually have a downfall. Whether it's investors or football players.
You know, if you're too successful at something, be careful. And I would say the same about investors. What is the key? So, knowing everything you just said, there is a huge uncertainty. Often, both leaders and their people don't want to make difficult decisions because it negatively affects many people, right?
And you can see a lot of that in the market, right? Both about the irrationality of super high and super low rates, and about when the truth might turn out to be different, like in your example of the sky being a different color than everyone expects. And so, over time, these big ups give way to downs, and downs turn into ups.
So you can build an understanding of the world that you wouldn't otherwise have. Given all of this, with so much uncertainty, where you don't know what's going to happen, how can an investor survive multiple market cycles over a long period of time? Well, Harvey, you're asking about people. And it doesn't matter whether it's a country with a large army, the most successful army in the world, or the poorest country.
I mean, we're all human. We are all captivated by emotions, arrogance, modesty. Most of us fail to achieve success for very long because we are human. We take on too much, we become too self- confident. You know, if you read in the newspaper every day: " This guy, Harvey, is really smart." And you see it every day, you see yourself on TV every day, and everyone admires how smart you are and that everything you say is right.
You will start to believe it. And then, before you know it , you're doomed , because I suspect you're just like the rest of us. I mean, I think you know enough history to understand: it boggles people's minds. People tell you that you are the smartest guy in town, eventually you will actually believe it and start thinking that you are the smartest guy in town.
And if someone says, “Harvey, wait. Wait. Wait. Don't do this." You tell them, “I’m the smartest guy in town. What are you talking about? And you will go to the bottom, like the rest of us. Is this something you can only learn from your own experience, or is there a way to stay sane? Oh, if only I knew.
I thought we were discussing people in history. I hope I can find some way. Every time I started to think I was smart and knew what I was doing, the market showed me I was wrong. I wasn't as smart as I thought I was, and I've seen this happen to many, many, many people throughout history. And I'm sure even you will have such an experience someday.
Even Harvey, once. So you were incredibly successful , and the returns you made from the Quantum Fund with George Soros were incredible—both then and now. So, you had the whole world in your hands. Why did you leave the investment field and decide to travel the world? Well, Harvey, I grew up in a small town.
My phone number used to be five. This is not a printer. My phone number was 15. That's all. Um, there are people who never leave anywhere and don't want to, and that's okay. But I knew there was a whole world out there, and I wanted to see it. I knew I only had one life, and I wanted to see as much of the world as possible, experience everything, and my kids were like, " Damn it, why are you wasting so much time on adventures?" Why do n't you spend more time to make more money?
We would be much richer." You know, that's normal. But when I die, they will forget all this. They will be preoccupied with their own lives. But I knew, I mean, like I said, Harvey, I grew up in a place where my phone number was five. I knew there was something more . I wanted to feel it, whether it was right or not.
What have you learned while traveling the world? Probably nothing. I don't know if I learned anything at all. I didn't go to fashion school, so who knows if I learned anything. But, perhaps, the most important thing I realized is that we are all the same. It doesn't matter where we are. We all want the same thing from life for our children, for our families.
We all want, essentially, the same thing . Of course, some of us want it differently , it doesn't matter. But in the end, no matter who you meet or where you go, Harvey, we're all the same. Would you do it again? I don't know if there are many things I would change. I would n't have married my first wife.
I know it was a mistake. But you and I both have experience, I definitely look back on my mistakes. Yes, it would be easy if all I had to do was say, "Harvey says I can fix this mistake." That would be great. It would be great if I could somehow undo all the mistakes I've made in life. But then I wouldn't be the same person.
I know that people have to make mistakes to succeed. What do you think is the key to a happy life? Oh, that's an extremely good question. This... This is what everyone in the world is trying to think about. Think of Socrates, Aristotle, all these guys were trying to figure it out. In my opinion, figure out what really makes you happy, then do it and keep doing it.
But most of us are obsessed with fame or money and we want more, more, more, and more. Oh, I want more too. Yes, I want more money, good wine, everything . But true success is simply understanding what you love and doing it. Regarding this lifestyle, you have experienced both earning a lot of money and working incredibly hard, reaping the rewards, as well as a life of traveling the world.
In your opinion, should a young person devote more time to their career and then have fun and travel, or vice versa—first travel and explore the world, and then work? That's a great question, but, Harvey, I can't answer for anyone else. You have to answer that yourself. Yes, I'm telling you, Harvey, the most exciting thing for you in the world is to get a motorcycle and ride it around the world.
But you might say, "What the hell are you talking about?" I hate motorcycles. You know, I don't know what you're going to say. You can say you hate new countries. Everyone has to figure this out for themselves. Yes, I can go to a bar with you on Saturday night and we'll all sing and dance. But I assure you, everyone in that bar will have a different idea of happiness and the future than you and I have.
Even if you're the smartest guy we know, they'll still think differently because they're not as smart as you. What advice would you give to a 22- year-old who is just starting their career? Find what you love the most, what you love the most, and then do it. And if you really want to be a gardener, and all your teachers and friends say, "Oh my God, are you crazy?" "Don't be a gardener." No, Harvey, if you really want to be a gardener, please go and become one , because you will be extremely successful , you will be happy, and you will not care what other people think.
Especially because you'll become one, and one day they'll all say, "How did you know?" Because you will become the most successful gardener in the country, and everyone will know about it. But if that's what you need, that's what you should do. What does perfection mean to you ? Well, I mean, excellence is pretty simple: doing something well and doing it right.
So, if you want to play baseball, perfection is hitting the ball or catching it. It depends on what exactly you want to be perfect at. If you want to become a master at writing poetry, keep writing, and eventually, hopefully, you will succeed, you will create great poems that will be studied in ninth grade in every school in America.
You need to determine what it is you want to master . I strongly advise you not to listen to me. I advise you to find out what you truly love and strive for it. I can tell you, but it won't be good. If you could change one thing in the world, what would it be? Well, if I...there wouldn't be any wars.
I mean, wars...I've read enough history to know: wars are ultimately devastatingly destructive to capital, lives, everything. No one has ever won a war. Even people who think they are winning wars don't actually win. Because so much has been destroyed that yes, a few people, maybe for a few days, live just fine.
But in the end, no one ever won a war. Even those who think they have won the war. How do you cope with tough times? Oh, hard times? Are you saying that they are still waiting for me? Oh, God. Oh, you better not say that. Well, I've learned that they are inevitable. And the best thing I can do, the only thing I can do, is realize that this has happened before.
And all that's left for me is to pull myself together, try to get through this, and understand that everything will change over time. And hopefully, everything will get better. What does it take to become the best in the world? Well, to become the best at something, you need...I mean, I know enough history and people to understand: it takes tremendous discipline, drive, focus, and ambition.
And it's not easy. Even if you become the best in the world, be careful, because it probably won't last long. Because you will likely become overconfident , arrogant, and fail. This happens to most people. What do you want your legacy to be? I don't know. You'll have to ask my daughters about that. I just want them to ...most importantly, I want them to figure out for themselves what they want from life , and do it, and strive for what they want, not other people, not their family, not their husband or wife, not anyone else.
Unfortunately, most people in the world probably never actually do what they want to do . They do what others want, whether it's their parents, their wife or husband, or someone else. They never really go for what they want in life, and that's a little sad. I mean, I remember once I said I was going to ride a motorcycle around the world, and I told this to a man, well, a rich, very rich, successful man, and he said, "Why are you going to ride a motorcycle?" " Why don't you fly?" He didn't quite understand.
I mean, he just thought I should fly around the world. He didn't understand adventure, this drive. Anyway, everyone has their own quirks. I was a weirdo in my own way. Everyone is like that, and that's what you should strive for. What's next for you? I'm not going to fly around the world. I already did it.
I don't think I'll ever go anywhere on wheels again. I do n't know. Hopefully something related to my children. I have always been against having children. I thought children were a terrible waste of time, money, and energy, but I finally took the plunge later and realized I was wrong. I realized that children can be fabulous and wonderful, and everyone should have children if they can.
And girls are better than boys. I know that for sure. Although most people think boys are better. They are wrong. Girls are...it doesn't matter. Everyone should have children because it's a huge experience for everyone. Certainly, for me it was . My final question: What would you like the listener to take away from this episode?
I hope everyone finds out what they love most, and I hope you do. Very few people do this. Most people do what their friends, spouse, family, or someone else tells them to do . I hope you find what you truly love above all else, and if people say, "This is crazy, " then do it even more. Please, especially if you are told it is madness.
Do it. Do it. Do it. Do what you love. Do what you always wanted to do. Do it despite what people say. Even if people say it's crazy, please do it. Because one day you'll wake up and say, "I've always really wanted to do this." Here's what you should do. Please do this. Please do this. Thank you very much for your time, Jim.
It was an incredible experience to hear your story today: how you went from a small town in Alabama to Yale ; how they got into investing, learning from the best and founding Quantum Fund with George Soros; how did you manage to achieve such impressive results and work with Scott Bessent; your view of the world and how to invest in remarkable things; as well as advice to the younger generation— to get the most out of life and sincerely follow your passions.
It was an incredible honor for me. Thank you very much. OK. I am very touched. It was exciting and wonderful for me. I learned a lot. Thank you very much. Thank you. Thank you. Thank you. I'm sure you've taught me more than I've taught you. Thank you. Thank you. Thank you. See you later.
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