Wednesday, September 28, 2011

Up the Creek Without a Paddle


Sometimes Jim Rogers gets repetative since he usually pounds the same theories – which is not bad from the viewpoint he has a long term outlook, but in this interview with CNBC yesterday there are some interesting items regarding his current positions (currently long dollar even though he does not believe it to be a safe haven), and some trade/currency tensions developing. I must have missed the news about Brazilian import tariff on Chinese goods.


For those newer to trading I think his view on the dollar is important to understand from a lesson standpoint. Even if you the dollar is ‘cooked’ long term, time frame is important. For the near term, the U.S. dollar still is considered a safe haven (best house on a street full of crack homes) and in panic people flee to U.S. Treasuries and the dollar. So while Jim believes U.S. leadership (I use that word loosely) is constantly doing damage to its currency, he understands the way the other people in the market will react and will take advantage of it. (Rogers is a huge long term bear on the currency)

The U.S. dollar is going higher “against major currencies,” well-known investor Jim Rogers told CNBC Thursday. The dollar “is going up against everything right now” for a number of reasons, said Rogers. One may be that everybody is panicking “and for some reason they’re rushing into the U.S. dollar.” “The U.S. dollar is not a safe haven, if you ask me, but I do own it,” he added.Also, Rogers noted he would own the U.S. dollar, or the Swiss Franc, or agriculture. “Agriculture prices [are] getting banged right now. I am kind of planning on buying Swiss francs, more dollars and agriculture.”In addition, he weighed in on China’s economy, saying, “They’re doing their best to cool things off … I expect them to continue to do it, and that is causing more slowdown around the world.”Read the rest of the article



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Jim Rogers Tells India Press Gold Will Decline For "Months" - Forbes

  A London Good Delivery bar, the standard for t...


Commodities guru Jim Rogers told The Economic Times of India that gold prices are likely to correct for the next six to eight weeks, but offers this bit of advice: buy on the dips.


“Gold has been up 10 years in a row, which is very unusual in any asset class. So if it is up this year or 11 years in a row, gold is overdue for a correction and it could have a nice substantial correction given that it has been so strong,” he told India’s largest business daily.


“I have no idea what is going to happen this year. I doubt if it will go to $2000 an ounce in 2011, it is more likely to have a correction which will last for several weeks, several months. It has been very strong. If it goes down some more, I would buy more gold,” Rogers said.


He told the ET that the correction was mostly due to panic selling in response to the political risks facing the markets in Europe and the U.S. “When fear permeates a market, everybody sells, especially the last ones in frequently have to jump out. They have raised margin requirements for both silver and gold. So that makes it more and more difficult for people to hold on. I barely pay attention to the price, but I know a lot of people do and that is why you have these sudden spikes up and down.”


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Short emerging markets, beware of Russia: Jim Rogers

Sept. 26 - Problems in Europe and the U.S. will hit emerging markets, says well-known investor Jim Rogers, but Putin's return is less significant, given he has run Russia's ''outlaw capitalism'' for years.

Tuesday, September 27, 2011

The only sector commodity bull Jim Rogers would buy right now - Financial Post

Jim Rogers is a long-term bull on commodities based on scarcity in a growing world.

Silver and gold "will both go much higher over the next few years," he tells Economic Times. Oil prices will recover as "known quantities of crude continue to decline." Sugar is going to "at least double or triple before this all is over."

But there's only one sector he would buy right now:

I am thinking about buying agriculture right now. I am not thinking about buying base metals or gold or oil right now, but I am thinking of buying agriculture maybe this afternoon. That's where demand will come first. Probably precious metals second, then the rest of the commodities.

Agriculture is facing some very serious problems whether the world economy slows or not because we have shortages of everything. The inventories are very low. We even have shortages of farmers developing in many countries. The average age of farmers in America is 58, likewise Australia. In Japan, it is 66. You have hundreds of thousands of Indian farmers committing suicide. It has been such a terrible business. Higher suicide rate of any profession in the UK is in agriculture.

So farming has got serious problems facing it. We are going to see much much higher prices over the next decade. So I would buy agriculture soon. The others, I am more watching the world economy and the world markets before I step in.


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Jim Rogers: Is World Currency War Causing Global Market Meltdown?

Some quotes:

“The U.S. dollar is not a safe haven, if you ask me, but I do own it.”


“Agriculture prices [are] getting banged right now. I am kind of planning on buying Swiss francs, more dollars and agriculture.”


On China “They’re doing their best to cool things off … I expect them to continue to do it, and that is causing more slowdown around the world.”


“The major problems are coming from the west," “They are coming from Europe and the [United States]. We are much worse off than we were in 2008 because the debt has gone through the roof.”


“At least in 2008 there was the possibility that the governments could bail us out. Now, of course, the governments have gotten deep, deep, deep into debt themselves,” “Everybody is in much worse shape.”


Brazil sort of ignited a trade war [by putting a 30 percent import tariff on China and Korea ]. And right now China is trying to get the Europeans to let them open up the trade with China more. The Europeans are saying no, so China is saying, 'No, we won’t bail you out.'"


“I hope the trade war doesn’t break out" because throughout history when it does it has "caused depressions,” Jim Rogers added. “You saw what happened in the 1930s. It led to depression and it also led to war. So I hope it can be contained.”


Jim Rogers attacked Ben Bernanke stating, "is killing the people who save and invest, and that's really hurting a very, very large part of the population."


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Eurozone should allow Greece to default: Jim Rogers - Economic Times

FRANKFURT: Jim Rogers, Chairman, Rogers Holdings is of the opinion that a viable solution to the Europe sovereign debt crisis would be if Eurozone allows Greece to default. According to him the default, would be a magnificant signal to buy euros.

"I would buy all the Euros I could at that point. We would know we are going to have a sound currency, strong Euro," he said in an interview. He believes that euro would then be a very serious competitor to the US dollar.


Asked about his top pick in the commodities space, Rogers said that the current scenario would warrent a buy in the agriculture space.


Meanwhile, world's major economic powers are pledging to launch a bold effort to deal with a chronic slowdown in growth and a European debt crisis that are threatening to push the global economy into another recession.


But it was unclear whether their strong words would be backed up by equally strong actions.


The statement by the Group of 20 major economies late on Thursday pledged that the countries, which represent 85 per cent of the global economy, would do what was necessary to restore financial stability and calm financial markets.


IMF Managing Director Christine Lagarde said the world was entering a 'dangerous phase' and World Bank President Robert Zoellick said he still believed the globe could avoid a double-dip recession 'but my confidence in that belief is being eroded daily.'


The president of the Dutch central bank says in a newspaper interview that he no longer rules out the possibility that Greece may not be able to pay back its crippling government debt.


A Greek default "is one of the scenarios," Klaas Knot says in an interview published in Friday's edition of the respected Dutch newspaper Het Financieel Dagblad.


Greece could default on its debt next month unless it receives a (euro) 8 billion ($10.9 billion) installment from a bailout fund managed by the European Central Bank, the European Commission and the IMF.


A default could destabilize other financially troubled European countries, such as Portugal, Ireland, Spain and Italy. It would also deal a blow to many European banks, which are large holders of Greek government bonds.

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US Dollar is 'Not a Safe Haven': Jim Rogers - CNBC.com

The U.S. dollar is going higher “against major currencies,” well-known investor Jim Rogers told CNBC Thursday.

Jim RogersMIKE CLARKE | AFP | Getty Images

The dollar "is going up against everything right now” for a number of reasons, said Rogers. One may be that  everybody is panicking "and for some reason they’re rushing into the U.S. dollar.”

“The U.S. dollar is not a safe haven, if you ask me, but I do own it,” he added.

Also, Rogers noted he would own the U.S. dollar, or the Swiss Franc, or agriculture. “Agriculture prices [are] getting banged right now. I am kind of planning on buying Swiss francs, more dollars and agriculture.”

In addition, he weighed in on China’s economy, saying, “They’re doing their best to cool things off … I expect them to continue to do it, and that is causing more slowdown around the world.”

But “the major problems are coming from the west," Roger stressed. “They are coming from Europe and the [United States]. We are much worse off than we were in 2008 because the debt has gone through the roof.”

“At least in 2008 there was the possibility that the governments could bail us out. Now, of course, the governments have gotten deep, deep, deep into debt themselves,” he added. “Everybody is in much worse shape.”

Plus, there are all sorts of trade tensions and currency tension developing, Rogers went on to say. “Brazil is sort of ignited a trade war [by putting a 30 percent import tariff on China and Korea ]. And right now China is trying to get the Europeans to let them open up the trade with China more. The Europeans are saying no, so China is saying, 'No, we won’t bail you out.'"

“I hope the trade war doesn’t break out" because throughout history when it does it has "caused depressions,” Rogers added. “You saw what happened in the 1930s. It led to depression and it also led to war. So I hope it can be contained.”

Stocks plunged Thursday, fueled by ongoing global economic jitters in addition to a gloomy outlook from the Federal Reserve .

The Federal Reserve announced it would launch a new $400 billion program in a move to rebalance its $2.87 trillion portfolio — a version of the widely expected Operation Twist—by selling shorter-term notes and using those funds to purchase longer-dated Treasurys.

Ben Bernanke's idea that low-interest rates are good, "is killing the people who save and invest, and that's really hurting a very, very large part of the population," concluded Rogers. 


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Monday, September 26, 2011

Jim Rogers: Gold Correction Could Last for Weeks

The gold selloff could last for several weeks, months maybe, which is normal after a 10-year rally but investors shouldn't ditch the asset altogether but buy amid price dips, says international investor Jim Rogers.

"Gold has been up 10 years in a row, which is very unusual in any asset class. So if it is up this year or 11 years in a row, gold is overdue for a correction and it could have a nice substantial correction given that it has been so strong," Rogers tells the Economic Times.


"I doubt if it will go to $2,000 an ounce in 2011, it is more likely to have a correction which will last for several weeks, several months," he said.
"It has been very strong. If it goes down some more, I would buy more gold."

Gold — now trading around $1,630 an ounce — has been falling in part on fears that Greece could default and spark on run on European banks, which could bruise the euro and fuel demand for the dollar, a safe haven amid market turmoil due to its liquidity.


"It shows you that at times of extreme stress, there is not a suitable substitute to liquidity and although gold is liquid by metal standards, in comparison to Treasurys, when you get this kind of flight to cash, then it really is cash that counts and that means U.S. dollars," says Credit Suisse analyst Tom Kendall, according to Reuters.


"The markets are going to continue to react this week to the political situation within Europe, and I don't see any quick resolution or stimulus coming to the markets."

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Thursday, September 22, 2011

Jim Rogers: Chinese Yuan Good Bet; Swiss Make 'Huge Mistake' - Barron's (blog)

Commodities investor Jim Rogers was on CNBC Wednesday arguing that the Swiss National Bank made  ”a huge mistake” by deciding to limit the franc’s appreciation against the euro.

While such a move might work temporarily, “the market will have more money in the end than the SNB,” said Rogers, who was the co-founder of the Quantum Fund with George Soros.

Rogers also has helped design the Elements Rogers International Commodity Agriculture ETN (RJA). He also put together the benchmark for the Market Vectors RVE Hard Assets ETF (HAP).

After the Swiss bank’s move on Tuesday, the PowerShares U.S. Dollar Index ETF (UUP) rose sharply.

The risk, says Rogers, is that the Swiss bank will “totally debase the Swiss franc trying to keep Switzerland ‘competitive’ which will then destroy the traditional Swiss financial industry.”

The Chinese yuan (CYB) is probably the best safe-haven currency now, he added. The dollar is probably also a good bet in the short-term, but the “absolute worse” over the longer-term, said Rogers.

Last month, he said that stocks weren’t a good play generally and that a “supercycle” in commodities will last longer than any previous bull market of its kind. He believes commodities have another 20-25 years of upside left to run.


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World economy faces slow growth, says Jim Rogers - BBC News

The question on a lot of people's minds is the state of the global economy. Some are predicting a return to recession and at best others believe we will see a period of stagnation.


With global stock markets taking massive hits in the last few months over fears about the eurozone and American economies, what can be done to ease these concerns?


The American investor and financial commentator Jim Rogers says the world is going through a historic shift that will see a period of slow growth. However, he is not worried.


On the BBC World Service's Business Daily, Justin Rowlatt began by asking Mr Rogers how long he expected the US economy, the engine of global growth, to stagnate for?


Transcript of the interview:


Jim Rogers: I hope it's only one decade of loss that we lose in America. Japan has had two lost decades now, as you probably know, and America is in much, much, much worse shape than Japan.


America is the largest debtor nation not just in the world, Justin, in the history of the world. We have serious problems. They are not addressing the problems in America. So I hope it's only one or two decades we lose. It may be three or four.


Justin Rowlatt: So what do American politicians need to do?


Jim Rogers: First they need to get a little education about the rest of the world and about their own economic situation and then we have to change our tax code dramatically. We have to cut spending with a chainsaw; not with an axe, with a chainsaw.


We got troops stationed in over 120 countries around the world. I mean the politicians have sent them there you know, and those military establishments are making things worse for America, not better. We got to change our total way of thinking just as the British did when the British started facing reality.


Justin Rowlatt: When you say face reality, you seem to be suggesting that the age of American supremacy is over?


Jim Rogers: Absolutely, aren't you? Listen to the BBC and you will hear what's going on in the world. The 19th century was the century of the UK, the 20th century was the century of the US, the 21st century is the century of China, of Asia, Justin.


I mean, here is a simple fact. The largest creditor nations in the world now, Justin, are China, Korea, Japan, Taiwan, Hong Kong, Singapore. Those are all Asian countries. This is where the assets are. This is where the energy is, the dynamism is. You know who the debtors are and where they are.


Justin Rowlatt: I mean the Chinese economy, for example, just to take one Asian economy, isn't looking so healthy itself, is it? I mean, yes, it's still growing, but there are these real concerns about inflationary pressures within the economy, which could derail Chinese growth, couldn't they?


Jim Rogers: Extremely insightful of you. Yes, China has got some problems and they will continue to have problems. Fortunately, they realised the problem. They are trying to cut back on the inflation.


They have made some mistakes too. They should have opened their currency to make it a convertible currency. The fact that it's not convertible and all that money trapped in China is just adding to the inflation. So yeah, they are making mistakes too. Still, I'd rather be with the creditors than with the debtors any day.


Justin Rowlatt: I suppose what I am suggesting is that you look at America, you look at Europe, you even look at China and India, the two great Asian behemoths, and you see problems across the world economy. Are we entering now a period of slow growth globally?


Jim Rogers: Oh, yes. Yes, yes, absolutely. If that's what you meant, there is no question about that. You just pointed out that China has got its own problems, but this is the way the world has always worked. We have gone through long periods when things were great followed by long periods when things slowed down for a while and we cleaned up mistakes of the past.


Justin Rowlatt: So you think we are entering one of these cyclical periods of slow growth worldwide?


Jim Rogers: Unless you know something I don't know, yes, absolutely. The only areas of the world economy I see that are going to be dynamic are natural resources; farming is going to be one of the best professions of the next 10 or 20 or 30 years.


Justin Rowlatt: You seem very sanguine about it, but you don't seem very worried by it?


Jim Rogers: No, not at all. The world has been going through big changes like this throughout history. In the '20s and '30s, the world moved from the UK to America exacerbated by a financial crisis and mistakes made by politicians.


The world is going through a historic shift again from the US to Asia exacerbated by a financial crisis and mistakes made by politicians. Justin, the world has been going on for a few thousand years and there have always been big changes and adjustments.


At some times in history, the financials types have been in charge; at other times in history the people who produced real goods have been in charge. It's the way the world has always worked. The key of course is to figure out what's coming next and go there. Become a Chinese farmer, that's what you should do, Justin.


Justin Rowlatt: You say farming, why do you think farming will be such a crucial sector in the next couple of decades?


Jim Rogers: Farming has been a disaster for 30 years, Justin. The average age of farmers in America is 58 because it's been such a horrible business. The average age of farmers in Japan is 66. In Australia, it's 58. I could go on and on. In 10 years, those farmers are going to be 68 if they are still alive.


Justin, we have huge shortages developing in agriculture and great fortunes are going to be made by the people who address those problems.


Justin Rowlatt: And commodities is the other sector you said we should look up. Now hold on a second. If the world economy is entering a period of slow growth that you think is going to last not one decade but a number of decades, why on earth would you put your money in commodities?


Jim Rogers: Because you asked where the best areas of the world economy are going to be, that's where the shortages are developing. In the 1970s, most of the world's economies were in the tank, but commodities boomed.


Justin, we had one of the great world markets of history in commodities for about 15, 20 years in the '70s, between the '60s and the early '80s in commodities, because we had huge shortages everywhere and because governments everywhere printed money.


Well, governments are printing money again. It's a wrong thing to do Justin, but that's all they know to do. So between shortages of supply and money printing, if you want to be in the dynamic parts of the world economy, don't get an MBA and go to Wall Street, go and get a farming degree and move to Asia.


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Jim Rogers: If Greece Defaults, Run to Buy Euros - NewsMax.com

If Greece defaults on its debts, the wise investor would buy as many euros as possible, says international investor Jim Rogers.

First, a Greek default would eventually put the country on the path to proper reorganization and secondly, those left in the euro zone would consist of healthy economies unlike that of Greece, where debt burdens are sparking fears the country will default and spark a run on the financial system across the continent.


"If you're bankrupt, go bankrupt, reorganize," Rogers tells CNBC.
"Countries have been going bankrupt for centuries, there's nothing new about it."


All the better, Rogers says.


If a string of defaults occurs "the euro will go down a far amount. But I would buy all the euro I could at that point because then that would mean that Europe is going to have a very strong, sound currency," Rogers says.


Stock markets, however, should continue to roil with volatility thanks to concerns that stronger European economies won't be able to help Greece out forever.


"We're dealing with a confidence crisis," Matt McCormick, a money manager at Cincinnati-based Bahl & Gaynor, which oversees $4 billion, tells Bloomberg.


"A lot of people think that Germany will pull out a rabbit from the hat and fix Greece. Germany is fighting its own issues. It cannot be the sugar daddy for all of Europe."

© Moneynews. All rights reserved.


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Views | Should more Indians learn Mandarin? - Livemint

Maverick investor Jim Rogers says that one of the best things he has done for his two daughters is teaching them to speak Mandarin, because he believes it will become the most important language in the world in the coming decades.


Mint reported on Wednesday that the Great Lakes Institute of Management, based in Chennai and founded by Bala Balachandran, has made in compulsory for all its students to learn Mandarin. Other B-schools in the country are also offering the Chinese language as an optional subject. There have been earlier news reports about how business executives and traders who have growing business in China are learning to speak Mandarin.


Economist Arvind Subramanian has argued in his new book --- Eclipse: Living In The Shadow Of China’s Economic Dominance --- that the shift of economic power from the US to China will happen more rapidly than most believe. I have not read the book, but an essay based on the main thesis that Subramanian has published in the latest issue of Foreign Affairs.


The rise of China as a dominant power will have implications for the rest of the world -- from the nature of global public institutions to the ability of the yuan to replace the dollar as the world’s main currency to the potential military threat in the region. (The Indian and Chinese navies had their first face-off in the Indian Ocean in July.)


But there will be opportunities as well, as growing trade and investment links show. China is already India’s biggest trading partner. Both the threats and opportunities demand that Indians develop a deeper understanding of the Chinese. Learning their language is one obvious solution. It is surprising to see schools and colleges in India still offering European languages such as German and French, but not Mandarin.


Rogers is known for extreme statements, so Mandarin is unlikely to replace English as the most important language in the world anytime soon. Language dominance tends to last because of network effects: the very fact that the global elite uses English as its language of communication will ensure that new members of this elite will also want to learn English. The Chinese drive to teach English to its citizens in well known.


That said, there is no doubt that more educational institutions in India must begin teaching Mandarin.


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Wednesday, September 21, 2011

Jim Rogers: Poised to buy gold if price drops

Commodity bull Jim Rogers says he is not adding to his gold position at these levels, but would be a buyer of the precious metal if the price goes down

Sunday, September 18, 2011

Jim Rogers: Buy All The Euros You Can If Greece Defaults - Business Insider

A Greek default may lead to a default in Italy, Spain and elsewhere, causing massive selling in the euro.

Jim Rogers says in this likely scenario -- which could begin this weekend -- you should buy the dip. He told CNBC yesterday (via @_alea):

If this happens "the euro will go down a far amount. But I would buy all the euro I could at that point because then that would mean that Europe is going to have a very strong, sound currency," he explained. "People can not lie about their finances anyone, people have to run a tight ship."

"It would be a lot of pain between now and then, but boy if that happened in the next month or so, buy all the euros you can," Rogers said. Rogers also says he's buying the U.S. dollar as a sheer contrarian play: “The only reason I’m long…is because everybody in the world, including me, has been terribly pessimistic. And whenever that happens you should take the other side of the trade.”


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Jim Rogers

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