Tavistock's Lewis: Dollar Strong, But Euro Shaky
Joe Lewis is notoriously private, all but shunning the spotlight, even as he plays host to the annual Tavistock Cup, an exclusive golf event in Orlando, Florida pitting some of the most prestigous country clubs in the world, and their famous members against each other.
But the famed investor, who made a fortune playing the global currency markets, won't shy away from giving his opinion on the future of the U.S dollar, which some have openly questioned.
"The dollar will be the world's reserve currency, undoubtedly," said Lewis during an exclusive sit-down at his house with CNBC on Monday. "America is the engine to the world."
Lewis has far less confidence in the future of the euro, in part, because of too many competing interests among EU nations.
"I do not think the European monetary unit can survive in its current form," he said. "The Greeks will never act like Germans.. the economic and cultural differences are too great. One size fits all won't work."
Which is why Lewis is echoing the beliefs of another famous investor, Warren Buffett, who declared he was "bullish on america" in his recent letter to investors.
"I totally agree with Warren... the Federal Reserve is embarking on a policy which will create a modest amount of inflation which will be broadly good for business — the stock market will do well, people will do well and businesses will do well."
Tavistock Group, has done three deals in the U.S. in the last four months alone, including, acquiring the St. Regis hotel in Atlanta and the E-Brand and Back Bay restaurant groups. Aside from hospitality, the Group has holdings in real estate, oil and gas, professional soccer and life sciences — which has spurred one of its most ambitous projects to date — what it calls "Medical City", a vast campus near Orlando International Airport, comprising a medical school, research center and two hospitals.
Lewis calls it a 20-year project that started with a "good buy" of nearly 7,000 acres of land.
To some, embarking on such a substantial investment may have been a risk — but Joe Lewis doesn't mind taking them... especially when he sees an opportunity others don't.
Take Poland, where the Tavistock Group has been investing for the past seven years, including two recent property deals.
"It's a country of 40 million people", said Lewis. "They're well educated and industrious but they've been occupied by foreigners forever. Now they are free to make the most of their opportunities to build their economy."
And just like any real estate deal is all about location, location, location — Lewis likes Poland's — which borders Germany and Russia.
"It just a phenomenal place to invest," he said.
Lewis also likes Australia. He calls going long the Aussie dollar one of his best investments, and is just as bullish on the Continent's future.
"I believe in 20 years Australia will be in a great position as that region becomes a center of economic activity. It has 22 million well-educated people — great resources... it's English speaking and has rule of law."
Lewis also spoke out for the first time, about one of his most painful investments — losing nearly a billion dollars on Bear Stearns when the bank imploded during the financial crisis.
Why he was attracted to the firm in the first place?
"I believed Bear Stearns was on the eve of a major deal with China that would have transformed the investment bank."
At the time, Bear was the smallest of the big banks on the Street, and Lewis felt it lacked — a bigger global footprint.
"They had nothing international," he said.
Such an experience may have sunk other investors — but not Lewis — who at age 74, is still on the prowl for his next deal. When asked why, at this stage of his career is he still "in the game", Lewis paused, thought for a few seconds, and said simply — "It's what I do."