Interview with Robert Rodriguez of FPA Captial

I think this is probably one of the more interesting things I have read over the past couple of months. I like reading Bob's stuff and his speech last June could not have better predicted what would happen over the next nine months if he was writing about something in the past instead of the future. It is bearish but whether your a bull or bear I think there is alot to glean from it and highly recommend you spend the time to read it. Thanks goes to Britt.

http://welling.weedenco.com/files/DDF/1008%5FLI%5FRodriguez.pdf

On relying on models.

I have seen more crap come out of the Excel spreadsheet than Carter has pills.

My point is that you don’t need these models. I’m a pretty mundane and simple analytical type person.

On inflation

If you don’t think inflation is going to be a problem over the next 12 to 24 months, I could argue that’s probably a reasonable expectation. But over a period of five or ten years, I don’t think it’s a reasonable expectation. Because I see a further degradation in the penalties for unsound risk-taking.

On a second half recovery

What is Fed Chairman Bernanke banking on? A second-half recovery— even if it’s a subdued
one. So that’s also what the stock market is hoping for. But I think that this recovery will prove to be rather wanting.

Well, that probably means that earnings expectations are still too high, by a long shot, in the
stock market and that we have a long period of earnings disappointments ahead of us.

On the recent economic activity. By the way, you saw this in many calls. Economic activity came to a halt in March. All kinds of commentary in the corporate conference calls about March.

When I was talking with my logistics guy over the weekend, I asked him, “What are
you hearing around?” And he says, “Bob, it’s as if things fell off a cliff three weeks ago.” I said,
“What do you mean?” He said, “I’ve been talking to people all across the country, it’s all the same. It’s fallen off a cliff. It doesn’t matter, by industry. You can get maybe a load going across country, but then you’re going to have to deadhead back. You can’t do it.”