Doug Casey on Cars – Past, Present, and Future

(Interviewed by Louis James, International Speculator)

L: Doug, last week we talked about energy, including your thoughts on what’s in store for the oil markets. That naturally leads me to ask about something that I know has been near and dear to your heart: the automobile. Especially high-performance cars – which were the basis of your first capitalist venture.

Doug: It’s appropriate that we talk about cars now, with the recent bankruptcy of General Motors. I’ve always been interested in cars. The first car I had was a 1964 Pontiac GTO, with the tri-power and all the extras. Throughout my life, I’ve always had high-performance cars. I had a couple 289 Cobras. I had a 427 Cobra.

And yes, the first business I got into was importing Ferraris to the United States. This was in 1967. In those days, there was a relatively small middle class in Europe. So you could either afford a new Ferrari, or a new Fiat, but there was no market for used Ferraris, because of the maintenance costs and social strictures that came with owning one. On the other hand, in the United States, there was even more of a middle class to society than there is today, and everybody wanted a used Ferrari.

I was in college at the time, but I saw the opportunity and decided to act on it. I bought a 1962 250 GTE 2+2, in Milano.

L: Was that the four-seater?

Doug: Yes, although the backseats were pretty cramped. It was the car that Ford copied for their 1964 Mustang 2+2, and it was a lot of fun; it had a 3.0 liter V-12 with three 2-barrel Weber carbs. I drove it through a lot of Europe and went to a couple of driving schools, one at Montlhéry, the autodrome of Paris, the other at Monza in Italy. I then sold it, sight unseen, to a guy in Ohio. The price was so good, he couldn’t resist it.

I went back to Milano to pick out a second Ferrari, a 330 GT 2+2. I had the bit in my teeth – I had plans to refine the business. Who knows, if I had done that, my entire life would have been different. But… Stroke of fate. There was a truck passing a tractor on a blind curve in between the towns of Fribourg and Bern in Switzerland, and I had a catastrophic accident. It put me in the hospital for six weeks.

That put paid to my first business venture of importing used exotic cars to the United States, but I’ve stayed interested in cars since then.

L: What’s your favorite car today?

Doug: Well, I’ve got to say that dollar for dollar, pound for pound, you can’t beat a Corvette. It’s too bad it’s a General Motors product – it’s one of the very few that General Motors makes that’s a decent car. More than decent; the Corvette is a fantastic car. It’s a high-performance, light-weight, fine-handling economy car.

I have a Corvette I bought in 2004, and the car averages about 23 mpg in the city, and about 26 or 27 mpg on the highway. In fact, I’ve noticed that while cruising in it over 100 miles per hour, even then, it averaged 26 mpg, according to the instant readout.

L: I always thought you were joking about Corvettes being economy cars, but it’s true. My 2008 gets 30 mpg at 70 on a level highway – at that speed, it’s barely ticking over at about 1,500 rpm. My average fuel economy, for the entire time I’ve had the car, including city driving and some racing, is 23.4 mpg. I bought the car at your suggestion, because most of the time I drive, I’m driving by myself to an airport or to business meetings. It was silly to be driving my nine-passenger SUV like that – it gets literally half the mileage, and it’s hard to park the beast in Vancouver to boot. For folks who drive a lot by themselves, or with just one passenger, the Corvette actually is an economy car.

Doug: Yes, they’re fantastic cars. They don’t need maintenance. They use very little fuel. They don’t rust. If anyone’s looking for a high-performance car, I’d suggest the Corvette be the first on their list.

In New Zealand, where I live three months of the year, I’ve got a Toyota Supra Twin Turbo, which is almost as fast as the Corvette but isn’t nearly as much fun. I’ve also got a Mazda RX-7, fantastic car, but I’m just too big to drive it comfortably. I let my normal-size friends who come to visit use it.

In Aspen, I’ve got a Porsche, the last of the air-cooled twin turbos with four-wheel drive, and it’s a lot of fun to drive. But when I’m driving into town and I have to decide whether to take the Porsche or the Corvette, I usually take the Vette. The Porsche is actually faster, handles better, and in a road race, it’d probably win, but the Corvette is just more fun to drive.