Translation to English

Oaktree Capital Management “Korea is an Attractive Market”

ByeongHwa Lee for Chosun Biz
October 29, 2013

“The Korean economy is generally improving. It has the right elements for long-term investing.”

Howard Marks, chairman of investment management firm Oaktree Capital Management, held a press conference on the 29th at Seoul Westin Chosun Hotel and told reporters that “Korea is an attractive market to invest in.”

Mr. Marks said, “Korea is in the initial stage of the 2nd phase of the economy where expectations are not too high or too low”. Previously, he classified the economy into 3 phases. The first phase is where only a handful of people are optimistic about the economy; 2nd phase is where many people believe the economy will get better; and the 3rd phase is where everyone thinks the economy will grow without limits.

Mr. Marks said, “To be a wise investor, you need to be able to judge exactly where you are in the cycle and invest carefully.” “Move forward but diligently construct an investment strategy.” Also, he said, “With increased uncertainties such as the breakup of the Eurozone and the conflict in the Middle East, people need to carefully examine the status quo rather than trying to forecast the future.”

Regarding the Fed’s tapering, “You cannot move a patient out of the ICU without giving him enough time to recover.” This can be translated as meaning that the US economy needs to recover to a state where it can stand on its own feet in order for the tapering to begin and that tapering will not begin immediately.

Mr. Mark says that even if tapering begins, it will be difficult for US government yields to climb to 7~8%. Mr. Marks said, “Most people think that the low interest environment is caused by QE and that once it decreases, interest rates will rise. However, in order for rates to rise, the economy needs to improve. Unless there is an abrupt increase in inflation, government yield will not increase dramatically”

On why he visited Korea, Mr. Marks said, “(I visited Korea) as part of regularly visiting our clients. I also look forward to good results from the joint venture with NPS and collaboration with TCK.”