Tuesday, August 9, 2011

I am long on commodities, short on stocks: Jim Rogers - Commodity Online

MUMBAI (Commodity Online): As the market slide continues, commodities will be the first thing to turn around and go up, said Jim Rogers in an interview to ET Now
. In the 1970s, Gold dipped 50% before it picked up steam and hooted past record highs adding value by 850%, he said.
Talking to ET Now, Jim Rogers, the savviest commodity market player and Chairman of Rogers Holdings, said the current developments in the markets are reminiscent of the 1970 crisis, when there was a shortage in commodities but the governments all over the world were printing money. Such a scenario can fuel a bull market, he said.

Currently, there is panic in the market, and panic can make strange things happen.

Economic woes

The world is having serious economic problems building up for the past 3-4 years, he said.

America—the largest debtor—is scaling up in debts further even as many European nations join the fray.

“The world has got serious, serious problems” he said and added, “America's situation has got worse and worse and worse...”

He pointed out that the world has not properly dealt with the first recession, even as he said that the he was not sure if the world has got out of the first recession.

Emerging markets

Since the Emerging Markets went up a great deal in the past years, there is likelihood that the markets there would come down, adding that, the markets “probably going to do as bad or worse than the west.”

Long on commodities

Jim Rogers revealed that he is long on commodities but short on stocks. Bullish about gold, he said he would buy Gold if the prices dip and would not prefer to buy when the prices rule at near-record highs.

Printing money is wrong

When the panic ends, commodities would be the first thing to turn around go up, he said. Given the shortage, governments would print money.

“It is a wrong thing to do but the American central bank has said it will print more money if things do not get better.” He pointed out. And if that be the case commodities will continue to go up, he added.

Jim Rogers

Warren Buffett

Nouriel Roubini