Maria Bartiromo did a great job moderating a panel of private-equity
billionaires this afternoon. Every so often she’d try to get some investment
advice out of them, with little luck. Leon Black of Apollo
Advisors made a good point: there’s a world of difference between passively
buying a stock in the hope that it will go up, and actively buying a company
with the intent of shaking it up and making it better. If you don’t have a few
billion dollars to spend, it’s not clear that getting investment advice from
a private-equity principal will do you any good at all.
But when faced with a question of which country he was most bullish about,
Thomas Lee of Thomas H Lee Capital actually gave a real answer
– and not an obvious one, either. After two days of hearing the "China
and India" mantra to the point of meaninglessness, most of the audience
expected either one or the other. But instead Lee pulled a name out of left
field: Canada.
It’s all about the price of oil, you see. With oil in the $60s, it becomes
economic to extract oil from Canada’s tar sands and shale. Which means that
Canada’s oil reserves have effectively increased tenfold overnight, and Canada
now has the second-largest oil reserves in the world. What’s more, Canada is
a country, like Norway, which might actually be able to use its oil wealth sensibly,
rather than coming down with a bad case of Dutch
disease.
The Canadians do tend to be something of an afterthought in big international
conferences, overshadowed as they are by the US. But their currency and their
economy are strong, no one hates them, and they have no problems at all with
corrupt judges or untrustworthy property laws. If you do want to start taking
advice from a private-equity guy, Canada might not be such a bad place to start.