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U.S. industry needs greater protections against global piracy, said Mario Gabelli of GAMCO Investors on Wednesday.
“In a world where the United States is leading in technology, and also leading in intellectual content, how do we deal in a global marketplace where we have to deal with the Chinese to protect that?" he said. "When we export intellect and content, how do we get paid for it?"
Meanwhile, a falling dollar has helped the United States be more competitive in world trade.
“It basically says that our goods are cheaper than yours and yours are more expensive than ours,” said Bill Gross, PIMCO co-founder.
At the same time, a cheap dollar has essentially established a protectionist barrier against foreign imports, said Gross. A soft currency is also helping the U.S. government rebalance the economy in terms of production, services and consumption, he said. And rising exports have improved the U.S. trade deficit.
Also amid the economic slowdown, the asset management business has established a "new normal," said Gross.
“We're down-scaling in terms of economic growth," he said. "If asset prices go up less, then economies of scale companies that are large and can produce alpha for their customers are gonna benefit, whether that’s Legg Mason [LM
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] or PIMCO.”
And investors can still make money by "plain ol'" stock picking, said Gabelli.
“The stronger will get stronger,” he said. “JP Morgan [JPM
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]. Goldman Sachs [GS
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]. How will they take advantage of the next opportunity? How does the Steve Wynn, even though the stock’s coming in, how did they get an advantage because of their capital structure? And then the AutoNations [AN
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]of the world are able to go in and buy stores while others are shrinking their stores.”
GAMCO Investors is also looking for companies that will undergo some sort of “financial engineering,” he said.
“For example, a national fuel and gas in Buffalo, New York, they basically allow you to get $600,000 acres in a Marcellus field,” Gabelli said. “As a result of that, you basically can get $600,000 and at some point you get a company that’s going to go through some sort of financial engineering.”
Gabelli is also optimistic on talks that Comcast [CMCSA
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], which GAMCO has a position in, will buy a stake of NBC Universal from General Electric [GE
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].
“It’s a fairly simple transaction,” he said. “I think it’s a very good deal for all the parties.”
But why would Comcast stock weaken following news that a deal would be likely?
“Because they have to pitch the deal and you have to see what the details would be," said Gabelli. "Are they going to commit X dollars in cash? What are they going to own? How much additional leverage are they going to do? What’s the advantage of having a company with distribution?”
Comcast should be allowed to take on risk, to potentially gain or lose money, he said.
"If the shareholders don't like the deal, that's fine," he said. "I think they should do it."
For More Investment News on CNBC.com:
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- Warren Buffett and Bill Gates discuss the economy and other subjects with CNBC's Becky Quick.
- Many people are facing the holidays with substantially smaller incomes. Here’s how some are adapting.
- Jim Cramer is a proponent of stocks that pay healthy dividends, and here are his top five dividend plays.
- The homebuyer's tax credit jacked sales for a while, but 2010 is looking weak. Now what?
- CNBC’s technology reporter Jim Goldman guides you through the best gadgets to buy this holiday season.
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