UMB Scout International Fund's Jim Moffett appears as a guest on Bloomberg TV's Starting Bell

June 19, 2008

Time:	6:48 AM CT
Station:	Bloomberg TV
Location:	National Cable
Program:	Starting Bell

Betty Liu, Anchor: All right, well, in this morning's "Best In Class," we focus on the UMB Scout International Fund. The fund ranks in the ninety-fourth percentile among its peers for the last five years, and in the ninety-third for the year. Fund manager, James Moffett, manages four billion dollars at UMB Asset Management. He joins us now from Kansas City, Missouri to discuss his strategy, his outlook, his stock picks, all of that stuff. Jim, great to have you on the program.

International's been a big thing on our program. We've had many analysts come on saying, you know, "You've got to get into the international growth story, though largely through large caps in the U.S. here." So, what's the case about buying directly into these foreign companies? What's the advantage we have?

James Moffett, Lead Portfolio Manager, UMB Scout International Fund, UMB Asset Management: Well, the advantage is that you get a much broader universe. The large caps here that do business abroad are only a small slice of what's available. There are a lot of interesting companies that there's just no reason to restrict yourself to the few large caps in this country that are active abroad.

Liu: All right, I know we've got a slice-and-dice international bit, between developed markets and also emerging markets. You do like emerging markets, I believe a lot in Latin America. You know, we had Jason Trennert on yesterday, saying that the emerging markets equity risk premium isn't enough to justify going into those markets. He's talking about South Africa, Brazil, India. So, give me a sense-why does Jason have it wrong and why do you have it right?

Moffett: Well, I don't know that he has it wrong, or that we disagree that much. The only real emerging market that we have exposure to is Brazil. Most of the others, we agree that they are overpriced. Brazil is running on raw materials, exports, and as long as China keeps going, they'll keep importing iron ore and oil-things that Brazil is exporting. So, we think Brazil, in particular, is a good story. They're the only one of the, quote,"BRIC"- Brazil, Russia, India, and China-that we own at this time.

Liu: Oh, really? Okay, and what do you like in Brazil, specifically?

Moffett: Well, we like the energy sector, and we've talked in other places about Petrobras-it isn't one of our recommended names. But, Rio Dovoch-Dote-Deh-the, iron-ore company, the paper company. Also, AmBev, whose parent is trying to buy Anheuser-Busch; we've got a good stake in that. We like a good balanced Brazilian portfolio.

Liu: So, you must believe that the supply-demand story for raw materials, and particularly for oil, is very much intact then, worldwide.

Moffett: Particularly for oil. We think that the balance is there and it isn't gonna change very fast. The worldwide economy might slow down a little bit, slow down the demand, but the growth in India and China, in particular, is just so, so big for cars that gasoline consumption is going up. Meanwhile, Brazil's production profile is going up very dramatically. A lot of that is offshore; and one of the companies that we've picked was a French company, whose specialty is offshore oil construction:Technip-Coflexip.

Liu: Right, you like that, and you like that. And the other one you like is Coca-Cola Hellenic? You say that's a stock-and that stock's been beaten up. Why do you like it?

Moffett: Well, we like it because it's a whole lot cheaper than it was, and we don't think the long-run fundamentals are damaged that much. I mean, it's a thirteen-percent grower-at roughly thirteen-times earnings. It gives us exposure par, particularly to Eastern Europe. They've got bottling operations from Switzerland to Moscow. We think that's just a great way to get exposure to that part of the developing world.

Liu: Okay, Jim, thank you so much for joining us. That was Jim Moffett of UMB Asset Management.