Monday, July 6, 2020

Jim Rogers Discusses Bitcoin as Money and Why Governments Will Stop Crypto

Famous investor Jim Rogers shared his prediction about the future bitcoin and cryptocurrency in an interview with Asahi Shimbun Singapore branch manager Koji Nishimura, published on Friday. Rogers cofounded the Quantum Fund in 1973 with billionaire investor George Soros, which was considered one of the most successful hedge funds in its heyday. They earned a 4,200% return over 10 years through 1980 compared to 47% for the S&P 500.

Rogers believes that if cryptocurrency succeeds in being used as money, instead of primarily for speculation, governments will intervene, making it illegal in order to stop its use. For this reason, “I believe that the [value of] virtual currencies represented by bitcoin will decline and eventually become zero,” he told the publication. “It is hard for us to move money without the control of the government,” Rogers said, elaborating:

"The government wants to know everything. Controllable electronic money will survive, and virtual currencies beyond the influence of the government will be eliminated."

Rogers explained that cryptocurrency markets are volatile, particularly during the global economic crisis. “Even though cryptocurrencies did not even exist a few years ago, in the blink of an eye, they become 100 and 1,000 times more valuable … This is a clear bubble and I don’t know the right price,” he opined, emphasizing that cryptocurrency is not an investment but gambling.

He proceeded to talk about electronic money. “Governments like electronic money because with electronic money, you can keep track of when, where, who spent and how much. Governments will have more control over people through electronic money,” the investing guru described. “Electronic money has a low issuing cost. Cash must be printed, carried and counted. It is expensive for the government.”

However, cryptocurrencies beyond the control of governments will not be accepted as money, Rogers believes, adding that those who work on cryptocurrencies think they are “smarter than the government.” However, “the government has something that those who work with virtual currencies don’t have. It’s a gun.” For this reason, he said, “I believe that virtual currency will disappear eventually.”

He believes that governments will never let bitcoin be used as money. “Only 100 years ago, we could use whatever we liked as money. You could use coins, gold, silver, or shells. Banks could also print the bills themselves. That was legal,” he was quoted as saying. However, in the mid-1930s, the Bank of England declared that using any type of money other than the money it issued was illegal, Rogers pointed out. As a result, “no one used money other than that issued by the Bank of England,” he described, predicting that the same will happen to cryptocurrency.

While admitting that a society where governments “know too much about our actions” is “unfavorable,” he believes that cryptocurrency “beyond the control of the government will not be widely distributed as money.”

While Rogers is not bullish on cryptocurrency, many institutional investors are increasingly interested in investing in this asset class. Fidelity Digital Assets recently conducted a survey of about 800 institutional investors in Europe and the U.S. and found that 80% of them find cryptocurrency appealing, while 60% feel cryptocurrencies have a place in their portfolios. Grayscale Investments also sees increasing demand for crypto investments.

Well-known hedge fund managers such as Paul Tudor Jones have been growing their bitcoin holdings. Jones said he has about 2% of his assets in bitcoin. Other billionaire investors who are bullish on bitcoin include Virgin Galactic chairman Chamath Palihapitiya and Galaxy Digital CEO Mike Novogratz.

- Source, Bitcoin News

Wednesday, July 1, 2020

There Will Soon be a Blow Up in US and Possibly Japanese Markets

What is happening to the world? Everybody is simply trying to use the word liquidity. When I ask experts why are markets going up when the world is looking bad, the simple answer is it is liquidity, it is Fed, it is money.

The main thing that is going on in the world is that central banks all over the world are printing huge amounts of money and governments are borrowing and spending huge amounts of money.Every day the Bank of Japan goes in there and starts printing money as fast as it can and is buying stocks, buying ETFs, buying bonds. 

About somewhat the same is happening all over the world. In the US, they are not buying stocks. We do not think yet, but they are buying everything else. This is insane. But it is great for investors, it is great for stockbrokers, it is great for ETNow. Is it good for the world? No.

So if global central bankers are likely to print more money and if interest rates are likely to remain low, then what could be the end game for equities and for this so-called summer madness which we have seen in just about every asset class?

First you must remember that in America, there is an election in Nov. And in Washington, they are doing everything they can to get re-elected. 

That is what they do. They do not care about us. They do not care about our children. They care about getting elected. So until November anyway, this is all going to continue in the US. But other places will probably follow too. The end game?

Friday, June 26, 2020

Legendary Investor Jim Rogers Warns Governments Will Have To "Eliminate" Bitcoin

Bitcoin has made its fair share of enemies since it was created a little over ten years ago.

The bitcoin price, soaring to around $20,000 per bitcoin in late 2017, thrust cryptocurrencies into the global limelight, prompting governments to clamp down on their use and companies such as Facebook to create their own.

Now, legendary investor Jim Rogers has warned bitcoin and similar "virtual currencies beyond the influence of the government" will not be allowed to survive—and said the bitcoin price is headed to zero.

"If the cryptocurrency succeeds as real money, rather than the subject of gambling as it is today, the government will make the cryptocurrency illegal and eliminate it," Rogers told Japan's Aera dot in comments translated by Google.

Rogers is perhaps best-known for co-founding the Quantum Fund, with fellow legend George Soros and has gone on to establish himself as a television and media personality.

Bitcoin, still mostly used as an instrument of speculation, has attracted attention in recent months as the coronavirus pandemic has spread and governments have taken extreme action to support their economies.

The U.S. has allocated almost $3 trillion for coronavirus-related economic aid and the Federal Reserve has pumped trillions of dollars into the U.S. economy.

Renowned investors including Paul Tudor Jones, Dan Tapiero and Raoul Pal have named bitcoin as a potential hedge against the inflation unprecedented central bank stimulus measures could bring, though bitcoin is still far from being used as "real money." Some 11 million bitcoin, roughly 60% of the current minted supply, has sat dormant for a whole year, according to a recent research report published by Digital Asset Data—suggesting investors are "buying to hold."

However, governments around the world, spurred on by China's efforts to digitalize its yuan and Facebook's plans for a bitcoin-inspired digital currency, have accelerated their efforts to take money and spending online. "The government likes electronic money," Rogers said. "Because with electronic money, you can track when, where, who spent what amount. Governments will have more control over people through electronic money."

"The government wants to know everything. Controllable electronic money will survive, and virtual currencies beyond the influence of the government will be erased."

Many in the bitcoin community see cryptocurrencies as a way of resisting government overreach and some fear a proposed digital U.S. dollar could hand more power to the state. Rogers' comments could throw fuel on those fears. "The government has something that those who work with virtual currencies don't have," Rogers said. "It's a gun."

The bitcoin price, still highly volatile and prone to wild swings, is increasingly being watched by Wall Street as they launch bitcoin and cryptocurrency services and take on clients in the space.

- Source, Forbes

Friday, June 12, 2020

One For The Ages

I do a good deal of reading every day and I share the best of what I find on Twitter. The purpose of this reading is not so much to find out what's really going on as it is to try to understand how people feel about what is going on. What are the trends and narratives that are important to market participants and where are they in their life cycle.

One trend I've been following for a while now is the growing participation in the financial markets on the part of young individuals. Since most brokers went commission-free, following in Robinhood's footsteps, the interest in trading has gone through the roof. This week feels like the narrative is reaching a crescendo.


So I thought it might be important to immortalize some of the stories in my recent Twitter feed in a blog post here. During the dotcom mania, my friend Bill Fleckenstein tracked the bubble in what he called, "The Mania Chronicles." Consider this my very limited version of the same.


The stock market has set many records this year. After putting in the fastest 10% decline from a new high, it then put in the fastest 20% and 30% declines. Since then, however, it's now put in the fastest recovery from a crash in history.


An unprecedented boom in money printing for the explicit purpose of supporting asset prices is certainly part of the reason for the recovery but it is also important to note what that money printing has inspired: an unprecedented boom in financial market speculation by retail traders.


Combine massive money printing with mass speculation and record low liquidity (in futures and almost every other market) and you get the fastest 50-day rise in the stock market on record.


As a result, we now have an army of traders who believe they are the second coming of Warren Buffett. While the Oracle of Omaha now looks foolish for selling his airline stocks, those who bought them up over the past few months are gloating like you rarely see in this game.


Like Mark Cuban said, "everybody is a genius in a bull market," and the largest 50-day gain in history is minting a ton of geniuses right now.


To get a sense of the mindset of many of these traders, the Wall Street Journal spoke to a few of them and they make no bones about gambling with the funds the government sent them as part of the CARES Act, trying to double or triple it in just a day's time.


In 1999 and 2000, day traders went for the hottest internet stocks of the day in trying to make outsized returns; eventually many went bankrupt. Today, they're looking for outsized returns in the stocks that have already filed for bankruptcy protection!


But if there's a lesson from that earlier period, it's this:


This rally has humbled not only Warren Buffett but also Stan Druckenmiller, Sam Zell, Carl Icahn, Paul Singer, Jim Rogers and a host of other true geniuses of the industry whom have bet against it. It seems like it may soon be time for it to carry out those betting with it.

- Source, Seeking Alpha

Tuesday, May 26, 2020

Jim Rogers: Petrol is Not Going to Stay Dirt Cheap for Five Years, Opportunities Exist

"They have to look at the same factors – supply and demand. If we look at energy, for instance, known reserves of oil have been declining for years. And then along came fracking. Fracking was a miracle, but fracking turned into a bubble. If you could spell fracking, people would give you money to invest. Now, fracking is not going to disappear. It’s going to disappear for a lot of people because some are going bankrupt. But fracking is still going to be around, but it’s not a bubble anymore. And they have to worry about supply and demand like everybody else.

Sugar is down something like 75% or 80% percent from its all-time high. I don’t know many things that are down 75% or 80% percent from their all-time high. So all commodities dealers, producers and consumers are going to have to worry now about supply and demand. Most consumers are going to be better off if you are asking about the next year or two, except [those exposed to] gold. So most people are getting a benefit from this collapse, at least in their cost of living, if they have a job.

But now we all have to start worrying, including producers and consumers, about supply and demand because the price of most commodities are not going to stay down here where they are. I don’t think petrol is going to stay dirt cheap for the next five years, because production is starting to decline. So the answer is simple – supply and demand."

- Source, SPGlobal

Friday, May 22, 2020

Jim Rogers: Bright Spots for Commodities, Risk Still Remain

In commodity and energy markets, who do you think will be at the winning end and the losing end? And in this scenario, is there such a thing as safe haven?

At the moment, nearly all commodities are touching lows. Anybody who has anything to do with commodities – unless they’ve sold them short or unless they use commodities, are losers, except gold. But everybody who uses oil is a winner right now – Germany, China, Japan. People who consume oil think this is heaven. They think they’ve won the jackpot. Gold is up over the past seven or eight years. This is higher now than it was since 2011. So every commodity user is benefiting right now.

How do you see commodity markets panning out for the rest of 2020 and in early 2021?

I would suspect that most commodities now are close to the bottom. We’re in a period where the cure for low prices is low prices. In other words, when prices get very low, people use more of it and the producer produces less. China has opened up. Other countries are opening up again. So demand will go up again and prices will go up again. As I look around the world and all asset classes, the cheapest asset class I can see right now are commodities. Certainly not bonds – bonds are in a bubble. Most currencies are certainly not overpriced but certainly not as cheap as they might be. Stocks are certainly not dirt cheap anywhere. Everything I see that’s historically very cheap – that’s commodities.

S&P Global Ratings has said that the coronavirus pandemic is dragging the global economy into a recession. How long do you think it might take us to get out of it?

The last time I spoke with Platts, I said that the next time we have an economic problem in the world, it would be the worst in my lifetime. And it is – here it is. It’s not over yet. It’s going to get worse before it’s over. 

There’s going to be some rallies. But there’s too much debt. America was the largest debtor nation in the history of the world. And in the last month, Americans added several trillion – trillion with a T – dollars of debt and printed huge amounts of money. So the damage which is being done is going to take a while for people to recover from. There’s an election in November. 

They all want to be elected in November. All they care about is getting elected. But in the future, America’s got a problem of gigantic debt, not just at the national level, but also at the level of states, cities, as well and individuals. 

This is going to take a long time. In 1920, Great Britain was the richest, most powerful country in the world. But they started spending money and borrowing – doing the things that America is doing now. 

They lost. I live in Singapore. Many companies in Singapore are going bankrupt. This is going to leave a lot of scars and a lot of damage.

- Source, SPGlobal

Thursday, May 21, 2020

Jim Rogers: Crude Crash Like Never Before



Last night's WTI crash was an aberration, Oil Prices cannot remain at zero. It was due to contract expiry, says Jim Rogers.


- Source, ET Now

Sunday, May 17, 2020

Jim Rogers Helps Decode the Inflation vs Deflation Debate


Jim Rogers is one of the greatest investors/speculators in history and using his simple approach we can solve complex problems. 

Jim Rogers is well known for thinking outside the box to find huge returns in markets all over the world. 

But the same strategies that have made Jim Rogers famous can also improve your skills if you know how to apply them.

- Source, George Gammon

Tuesday, May 12, 2020

Jim Rogers Reveals Secrets That Could Make You Rich in This Crisis


Through decades of investing experience around the world and in every asset class Jim Rogers has built a reputation as being one of the best investors of our time. 

Jim Rogers has beat the markets by looking for asymmetric bets, in areas and assets classes that are beaten down and extremely cheap. He tries to find a catalyst for change and looks to fade hysteria in markets. 

By executing this strategy successfully for decades Jim Rogers has become one of the greats. And now Jim Rogers shares his wealth of knowledge with all of us.

- Source, George Gammon

Friday, May 8, 2020

Jim Rogers: Stock Up on Gold and Silver Before the Virus Crisis is Over


Things that are crushed right now like tourism, transportation and hotels will recover and do well, says the Chairman of Rogers Holdings.

- Source, ET

Friday, May 1, 2020

Jim Rogers Expects to See "L-shaped" Recovery


Legendary investor Jim Rogers, the founder of the Quantum Fund, expected that the world will not be able to recover from the lingering coronavirus crisis in the near future.

The financial commentator based in Singapore said that the economic recovery would not be a V-shaped curve, which will see a steep upturn, or U-shaped one, which is marked by a slow upswing.

Instead, he projected the world would see an L-shaped curve because the “debt-based bubble has popped” to cause “the worst economy in his lifetime.” It is the worst-case scenario that is feared to bring about an extended recession.

“The economy is different from the market. The market is having a nice recovery now. The government is everywhere, spending a huge amount of money, printing a huge amount of money. We are having a market recovery by money printed and spent,” he said in a telephone interview.

“That is not the economy. The economy has problems and will continue to have problems for some time _ L-shape if I have to say something.”

But Rogers is looking for investment opportunities even during the economic downturn in such segments as “transportation, tourism, travel, hotel, and restaurants.”

“They have been beaten, they have been smashed. So that is where I found opportunities all over the world,” he said.

In South Korea, Rogers fixes his eyes on companies, which will benefit after the opening of the 38th Parallel, which has divided the two Koreas over the past 70 years.

“I expect that the 38th Parallel will open before too much longer, and when that does, some companies will do very well,” he said.

“Once the 38th Parallel opens, the (Korea) Peninsula will be very, very exciting. In fact, China is the most exciting country for the next century, but for the next decade or two, it would be Korea.”

The interview took place on April 20 before the April 21 news articles that North Korean leader Kim Jong-un might be in a “grave danger” after going through a previous surgery.

- Source, Korea News Plus

Tuesday, April 28, 2020

Jim Rogers is bullish on agriculture, gold, and silver

Jim Rogers, the legendary investor famous for co-founding the Quantum Fund with George Soros, dwelt on COVID-19, QE, and commodities on a call co-promoted by ETF Strategy.

The event coincided with the relisting of the Market Access Rogers International Commodity Index UCITS ETF (LON: RICI) on the London Stock Exchange.

The ETF returns to London after a hiatus of four years. China Post Global had canceled the ETF’s LSE listing in 2016 due to low trading volume.

“Interest in gold and commodities has increased sharply since the COVID-19 pandemic began,” explained Danny Dolan, Managing Director of China Post Global. “Investors are seeking a safe haven in gold, and an inflation hedge in broad commodity indices after huge quantitative easing measures.”

Jim Rogers designed the Rogers International Commodity Index (RICI) in 1996/97.

Here are his views on the virus, helicopter stimulus and commodities.

On COVID-19

Rogers noted the extremely adverse impact of COVID-19 on global economies, saying it was unparalleled since the days of the Depression.

Encouragingly, he thinks this is likely only to be temporary, and that the world will bounce back.

He also made the important qualification that though production will rebound, it may not recover to pre-virus levels for quite a while.

Quantitative easing and stimulus

However, it appears that Rogers is more worried about the debasement of the global financial system that started after the 2008 crisis through fiscal and monetary stimulus measures by countries around the world.

Rogers is alarmed that what was then admittedly an “experiment” is continuing due to short-sighted political motivations, with no thought for long-term implications.

He claimed that artificially induced, low interest rates had fuelled hugely leveraged bets by sovereigns and corporates. These positions could unwind with dire consequences including insolvencies and people’s loss of confidence in the financial system.

- Source, invezz.com