, Jim Rogers Blog: January 2014

Thursday, January 30, 2014

What Jim Rogers is Long for 2014

Rogers prefers gold over gold mining shares and divisible coins over bullion, but says “there's nothing in precious metals that I'm tempted to buy at the moment.” Indian import tariffs he views as the single biggest drag on the gold market currently.

“They've got a huge balance of trade deficit and the three largest parts are oil, gold and cooking oil. They cannot do anything about oil or cooking oil, so they're attacking gold, blaming their problems on gold. Gold has not caused their problems, gold is a symptom of their problems, but politicians are pretty simple-minded people and they look for the easy answer.”

For early 2014, Rogers is therefore long inflatable equities and neutral on gold, but longer term, he expects to short junk and government bonds and is ultra bullish on gold. “Gold will become one of the only refuges around,” he says. “That's not this quarter.”

- Jim Rogers via a recent interview:

Tuesday, January 28, 2014

Gold and Silver May Get me Through Serious Problems Ahead

I've owned gold for many years, I've never sold any gold and I can’t imagine I ever will sell gold in my life because it is somewhat of an insurance policy. I hope that my daughters own my gold someday, I mean I owned gold, I've never sold any gold and if gold comes down and I expect it to go down, doesn't mean it will, I’ll buy more. I’m certainly not going to sell.

Everybody should own some precious metals as an insurance policy. So if they don’t have any right now, I would urge them to go buy something, buy themselves a gold coin if nothing else, and see that it’s not going to hurt. It won’t hurt you to buy the first gold coin, the first silver coin, and from that you start accumulating as your own situation dictates.

First, do your homework, don’t buy gold because you heard me say it or even because you hear you say it. But if people don’t own they should start after they have done their homework. And then they will probably, if they do their homework, most people will then realize, “Oh my gosh, I better have insurance, and gold and silver may get me through serious problems ahead.”

- Source, Jim Rogers via:

Sunday, January 26, 2014

Japan is Printing Staggering Amounts of Money

“The Japanese Central Bank has said that it will print unlimited amounts of money. That's their word and they're doing it. When people look back 20 years from now they'll say that's what killed Japan, but in the meantime, all the staggering, unlimited amounts of money have got to go somewhere and it's going to go into Japanese shares.”

- Jim Rogers via Mineweb:

Friday, January 24, 2014

Markets Are Going to Start to Suffer

“The US went up because people said, 'Now it's done, we don't have to worry anymore.' But somewhere along the line, markets are going to start suffering. They'll taper until the markets start hurting and then they'll panic and loosen up again. They've got themselves in a terrible box.”

- Jim Rogers, via Mineweb:

Wednesday, January 22, 2014

Tapering Will be Disaster


Influential investor Jim Rogers has warned about the impact of the US central bank's tapering plans, saying they will be an "unmitigated disaster".

His concern is despite US stock markets looking likely to end 2013 on a high and signs of recovery in the eurozone.

Mr Rogers told Sharanjit Leyl: "This is the first time that all the central banks are printing staggering amounts of money at the same time. There's an artificial sea of liquidity... This is going to be a disaster in the end."

Saturday, January 18, 2014

Cutting QE Will Cause a Collapse

I wish I was that smart or it was that easy. Back in the late 1970s, Mr. Volcker was told and he came in and said: “I am going to kill inflation because Mr. Carter has told me to.” And Mr. Carter was very clear that he had to stop inflation. I doubt if we’ll have that kind of scenario again but we would think, we would hope, that the Federal Reserve will announce, you know, that they publish their numbers so we can all see what’s happening. At the moment they are buying a trillion dollars a year – that’s a trillion with a “T” – of assets. Eventually we will see that they stop that if they do or slow it down.

What will probably happen is that they will slow it down at first to see what happens, and if things aren’t too bad at first – and they probably won’t be too bad at first – well what is likely to happen is they will slow it down, things will drop, and then they will rally and the Federal Reserve will say “Hey, this is not so bad, we can do it.” And they’ll cut some more. Things will drop again and then rally, because it will take a while for people to really believe how bad it can get, or will get. And so eventually they will try to cut [QE], it will finally cause the collapse, at that point we will have a big change, because they will throw them out, whether it’s the politicians or the central bankers or whoever … will continue because they like it, they got the job because of the collapse and then we’ll finally start over. But it may be really painful in the meantime.

- Jim Rogers via Birch Gold Group:

Thursday, January 16, 2014

Inflation Was Everywhere

Let’s say that in 2015, Yellen says, “We’ve got to stop this” and they start stopping it, well, at that point it’s going to be pretty serious for the parties in power and they’re going to get thrown out and the next guys will continue to taper because, as I’ve said, they got power because of the tapering and the problems, and they’ll clean up the problems.

But that’s the only way that you’re going to see it stop someday. The market is just going to say, “We don’t want to play.” That’s what happened with Jimmy Carter when he was in, everything was collapsing: bond yields were falling apart, you know, inflation was everywhere. “Thank you Mr. Carter, we don’t want to play this game anymore. It’s absurd.”

- Jim Rogers

Tuesday, January 14, 2014

No One Wins in a Currency War

We’re all losing in currency wars. How long can it go on? Well, it can go on as long as politicians can continue to print money. The problem is, of course, eventually the markets will just say, “We’re not going to play this game anymore” and we’ll have a serious collapse. You and I can print money all day long, but at some point, you, I and everybody else is going to say, “Wait a minute, guys, this money is getting worse and worse and more and more worthless, so why don’t we stop playing this game?” I wish the politicians were smart enough at some point to say, “We’ve got to stop this, this is going to be bad.”

But unfortunately they never have, and probably never will. Mr. Bernanke is certainly not going to stop it, because he doesn’t want to go down in history as causing the collapse. Mrs. Yellen, when she comes in, she’s not going to stop it, first of all she doesn’t believe in stopping it, she thinks printing money is good. And she knows – I hope she’s smart enough to know – that if she stops, oh my gosh, it’s going to collapse. So she’s not going to stop. Nobody wants to go down as causing the collapse of the world. So I’m afraid this is going to go on until the market eventually says to them, “Okay, enough is enough,” we have a big collapse and then they’re all thrown out and we can start over.

- Source, Birch Gold Group:

Wednesday, January 8, 2014

Investor Jim Rogers warns about impact of artificial sea of liquidity



As the US Central Bank cuts back on the emergency money it has been pumping into the economy, the influential investor Jim Rogers has warned about the impact of "an artificial sea of liquidity".

He said: "This is the first time that all the central banks are printing staggering amounts of money at the same time. This is going to be a disaster in the end."

He expressed concerns despite US stock markets looking likely to end 2013 on a high and signs of recovery in the eurozone.

Sharanjit Leyl asked Mr Rogers what effect the "tapering" would have on the US economy.

- Source, BBC News:

Monday, January 6, 2014

Jim Rogers Warns "Bernanke Has Set The Stage For The Fed's Collapse"

“100 years ago you could not have named the head of most central banks in the world,” Rogers told Mineweb. “Now they're all rockstars.” Gold and equity markets have increasingly been locked in Fed-watch mode in 2013, obsessing over when or whether chairman Ben Bernanke would taper the bank's vast bond buying scheme.

Rogers however, an ardent free-marketeer, says the market's narrow focus on the Fed reflects the bank's rising and now extreme interference in global markets, propelling the likes of Bernanke in the US and Mario Draghi in Europe to near household name status.

“Everybody knows them,” he says, “but that's only a phenomenon of the last 20 years, when central banks have been pumping money into the markets and everybody's singing hallelujah.”

With Bernanke's term due to expire in January, Rogers says he will be remembered as “the guy who set the stage for the demise of the Central Bank in America. We've had three central banks in America. The first two disappeared. This one's going to disappear too in the next decade.”

“It's not a possibility,” he adds, “it's a probability. People will realise that these guys have led us down a terrible path. The Fed balance sheet has increased by 500 per cent in the last 5 years and a lot of it's garbage.”

Unlike the wider market, Rogers does not set great store by the Fed's decision shortly before Christmas to taper its bond buying measures from $85bn per month to $75bn. The announcement put pressure on gold and drove US equities to a new all-time high, in what Rogers views as a relief rally.

“The US went up because people said, 'Now it's done, we don't have to worry anymore.' But somewhere along the line, markets are going to start suffering. They'll taper until the markets start hurting and then they'll panic and loosen up again. They've got themselves in a terrible box.”

“It'll turn into a bubble or a very inflated situation, but eventually the markets will say, we're not going to take your garbage anymore, whether it's treasury bonds or currency.” Inflation, Rogers says, has only been kept in check in the US by the country's shale gas discovery, putting a “dampener” on energy prices.

Whist Rogers views mass money printing as untenable, in the short term, he expects equities to turn parabolic, rather than collapse.

“The Japanese Central Bank has said that it will print unlimited amounts of money,” he says. “That's their word and they're doing it. When people look back 20 years from now they'll say that's what killed Japan, but in the meantime, all the staggering, unlimited amounts of money have got to go somewhere and it's going to go into Japanese shares.”

Rogers prefers gold over gold mining shares and divisible coins over bullion, but says “there's nothing in precious metals that I'm tempted to buy at the moment.” Indian import tariffs he views as the single biggest drag on the gold market currently.

“They've got a huge balance of trade deficit and the three largest parts are oil, gold and cooking oil. They cannot do anything about oil or cooking oil, so they're attacking gold, blaming their problems on gold. Gold has not caused their problems, gold is a symptom of their problems, but politicians are pretty simple-minded people and they look for the easy answer.”

For early 2014, Rogers is therefore long inflatable equities and neutral on gold, but longer term, he expects to short junk and government bonds and is ultra bullish on gold. “Gold will become one of the only refuges around,” he says.

- Source:

Friday, January 3, 2014

Water Shortages a Crucial Issue in China

American investor and author Jim Rogers says water shortage is the biggest problem in China. The country's water resources are limited but reuse of water is still insufficient and groundwater is being overexploited, reports ifeng, the financial news site run by Phoenix New Media in Hong Kong.

War, famine, civil war or recession can be overcome but drought cannot; people cannot build a society or a country without water, the investor said during an interview with the media.

China is one of 13 countries with the poorest water resources per capita in the world. Its freshwater resources per capita are only one fourth of the global average. As of the second half of 2005, the country had a water shortage of six billion cubic meters. Around 400 of the 660 cities in the country suffered from various degrees of water shortage. Of which the shortage in 136 cities are severe. The figure for water resources per capita in Beijing is close to those in Arab countries, where water is scarce. The groundwater in half of the cities in the country is also polluted.

However, most people living in the capital have not experienced any water shortage, even though water consumption of the country's agriculture and industries have exceeded other countries significantly. The country's water re-use rate is less than one third that of developed countries.

The issue has been covered by extracting groundwater, which has led to the disappearance of hundreds of lakes and tributaries in the country. Ground surface water in over 50 cities also reportedly sank in level due to groundwater exploitation. Hebei province, where water resources per capita are less than Israel, has overexploited over 60 billion cubic meters of groundwater, half of which has been unable to replenish. Its capital Shijiazhuang is expected to run out of its groundwater in 15 years.

Rogers remains bullish however despite China's water crisis. The issue has been the only thing that concerns him in the country for a long time. China has spent a lot of money to resolve the issue and he is positive that the country will find a solution, Rogers said.

- Source, Want China Times:

Wednesday, January 1, 2014

Abolish the Incompetent Federal Reserve

Legendary investor Jim Rogers not only thinks Federal Reserve policy is incompetent, he thinks the entire institution should be eliminated.

Asked by RT television network what he'd do if he was named chairman of the central bank, Rogers said, "I'd abolish the Federal Reserve, and then I'd resign."

The world has survived just fine without central banks for most of its history, he notes.
"America has had three central banks in our history. The first two disappeared," Rogers said.

"This one will too, because they keep . . . leveraging up the balance sheet. They keep making mistake after mistake. They keep printing money."

The result?

"This is going to self-destruct, unless the politicians say this thing is a mistake, let's get rid of it," Rogers said. "It's more likely, though, that it will self-destruct."

When it comes to stocks, which are trading at or near record highs, "we're certainly going to have a crash someday — all this artificial sea of liquidity," he said.

But while a correction could come soon, Rogers doesn't see an imminent plunge. "With all the money printing and spending in the world, this could go on for a while," he said.

Former Federal Reserve Chairman Alan Greenspan doesn't share Rogers' view that stocks are in a bubble.

The equity premium, "a measure of what the average investor requires the rate of return to invest in common stocks [is] still way below normal,” he told Fox Business Network.

"There are a lot of things that can go wrong,” Greenspan said. "But to say that the market is bubbly and in a position where it could conceivably create a serious problem, I think is overstating it."

- Source, Money News: