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WL Ross & Co. CEO Wilbur Ross on J.P. Morgan’s losses and why the Volcker Rule would not have likely prevented it.
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He's made billions of dollars turning around companies others thought had plunged into the of -- terms of banking in terms of steel you name it Wilbur Ross chairman and CEO of WL Ross sees plenty of investing opportunity right now he joins us.
In -- Fox Business exclusive always a pleasure to see you will be good to be around me.
Let's start with -- At 10% drop today is -- a -- on Monday.
Well I think it's ridiculous that a drop that much.
What we're talking and that is 110 of 1%.
Decline in the -- -- let's start with that.
It's a fraction of one quarter's earnings.
Take 10% off the stock for that.
Downgrade its ratings observed.
-- you -- on Monday but we're not open market buyers but -- where I wouldn't be afraid of JPMorgan.
Remains probably the best run bank.
But in the whole world.
The idea that because one -- whether it was I had some when they had put that little bit the amount of money relative to them.
It's not the end of the earth.
You're not exactly a lover of more regulation however could you argued that because of things like the stress tests that were implemented or other regulations.
Or talk a -- at least kept people aware enough that now this loss is perhaps smaller than it would have been and will not be systemic to the taxpayer -- Well I think JPMorgan has been controlling risks pretty well throughout the whole thing.
You can't legislate nobody's somebody making a mistake.
Obviously this trade was a mistake of -- so far it's been a mistake.
There's no legislation that's going to fix that.
And people saying that this is very small thing in the overall context of Morgan.
Means anything for regulation is a joke.
Now it's it's not even clear that if we have Volcker fully implemented since two years away from full implementation that.
Even if it was implemented you were you were allowed to hedge some your bets -- this is might have been allowed under the Volcker Rule well.
If the -- -- -- and -- -- though through Jamie Dimon has said that bonds if this was a hedge vocal rules permitted specifically permitted.
So that's also nonsense that Volcker rules would have eliminated.
But you can't have trading whether it's a hedge or any other kind of trading and never have the laws that doesn't happen.
Let's get to what you're buying right now there's one I was afraid you do that.
I know you don't like to share this information of these hours ahead of the game and Europe obviously has a bit of turmoil going on say the least.
What -- is there one European country that you feel confident enough in which to invest right now.
Well we are investing in Ireland and I think of talked about our -- before may be done on this show would have some unknown branded.
Show yet there are no other show if -- -- thought you knew -- it.
But -- Greece and Ireland is different is the issues that the other countries the club med countries are grappling with like austerity.
Ireland is already done it.
Him one day they took 13%.
Out of the total cost of civil service.
Cut out government funded capital expenditures.
They've been cut social services.
Despite fourteen and half percent unemployment.
And guess what.
No riots.
No strikes no car bombs the Irish people realize that the banks had been none of -- Real estate market had crashed and -- they had to deal with the residue.
What what kills me when I hear about the failure France and leading to two -- -- defeatist.
Circles he represented the free market -- point of fact -- see increased a lot of the government cost.
And increased tax rates so if if you're for a formula of growth yes if -- for austerity alone without growth that was the -- -- -- principal.
But this Ireland get -- -- -- and you go along with austerity along with cutting government you have to cut taxes make it easier for business well our.
-- has the lowest corporate tax rate in Europe and win the bill that came because of the banks.
The French tried to pressure Ireland into raising the tax rate as a quid pro quo.
Misled if you won't give us the bailout without making -- raise tax keep the balance.
So Ireland is quite firm in that regard and that's why it is more American corporate investment and -- Then in Brazil.
Russia India and China combined.
This little country of four and a half million people.
You're you're also very well known for having taken big bets and things like steel and coal -- -- we're very distressed.
What is your distressed asset -- distressed commodity that you're looking -- right now.
Shipping.
Marine transport marine transport of crude.
Marine transport of petroleum products and -- dream marine transport of natural gas and natural gas products.
It's natural gas at a bottom now is it is a good way because it's pretty close if it doesn't really at a bottom.
On the 23 year basis it's clearly going to be a lot higher and it's also quite clearly going to be a big part of the energy solution.
Not just for the United States but for a number.
Let's just mentioned that the name you like there's exco EXC.
That's correct why do you like that one in particular -- like it because its balance you do is structured in a way that they can survive this -- period.
Plus -- -- hedged.
44%.
Of this year's and output at a price well north of five dollars so well it's painful and the other half.
They're actually generating positive cash flow quarter by quarter Wilbur Ross you give us everything we have -- thank you very much for coming out of every shouldn't be done experiencing analysis and hynix.
