Thursday, December 22, 2011

Rogers: Buying US T-bills now is a 'terrible mistake' - Investment Week

Investment veteran Jim Rogers has branded US treasuries as the one of the last remaining asset bubbles left in the world.

He said he plans to short US bonds in the future and to buy them now would be a “terrible mistake”.

Rogers told Fox Business Network investors should instead look to hard assets, which will benefit from the US Federal Reserve's continued quantitative easing measures.

"I am not short bonds yet but I plan to be short bonds," he said. "If the world economy gets better, you are going to make money in commodities because that is where the shortages are.

"If the economy does not get better, they are going to print money and when it does get better, you better own commodities, such as silver and rice."

Rogers warned it would be dangerous to own US T-bills now but admitted he had been burned a few times recently when he attempted to short the asset class.

"I plan to be short bonds. I tried a few times before and I have been wrong. Bernanke has more money than I do and he can manipulate the market. But soon I will short them," Rogers added.

According to Rogers, the US Federal Reserve is already engaging in another round of quantitative easing but has not informed the public about it yet.

"The balance sheet has quadrupled in four years. They lie and say we are not having a QE3, but they are in the market," said Rogers.

He added the US was in a much worse predicament than Europe.

"We are in a worse situation than Europe. We are the largest indebted nation in the history of the world and we have states that are bankrupt. Europe as a whole is in better shape. Their bank is not printing money yet, maybe they will, but they are not yet," he said.

"Europe has made serious mistakes. What they should do is let Greece go bankrupt, reorganise and start over. Will they do that? No, they want the easy way."

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