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Jim Rogers says the US had no money saved, so when it poured, it resorted to printing
Posted: Tue September 22, 2009 5:40 pm
INTERNATIONAL. Legendary global investor and chairman of Singapore- based Rogers Holdings, Jim Rogers said Europe and the US have fallen in a vicious circle of issuing bonds leading to inflation, leading to more bonds leading to more inflation.
Speaking at the second China International Financial Services Conference, held at Guangzhou in South China on 10th September, Rogers said that the history of the US government over the last 50 years is one of piling up debt. He says decision maker do not seem to have leaned any lessons as they are repeating the same mistakes.
"I will not buy more US Treasury bonds because the government is constantly printing money," he told his audience.
"The global capital flows are diverting to Asia," said Rogers, adding that China saved up money for a rainy day; as it is now raining, they are spending their savings. The US had no money saved, so it is resorting to printing.
The world will never lack US dollars, he said. The dollar index has fallen to a new low, and will continue to fall, he predicted.
"If the dollar rebounds in the future, I will sell all my US dollars," he said, adding that he will be buying oil, minerals and stock of those companies which are engaged in the real economy.
The US Treasury bond market is a bubble, Rogers said, adding that that he couldn't tell when it will burst. Lending money to creditors for 30 years on an annual return of 3%-4% is very unreasonable.
Rogers predicts the Dollar's status as a world reserve may be reduced over the coming 5-10 years. He sees China, Japan and other Asian countries gradually holding more financial clout and Europe and the US turning into debtors.
My whole family has moved to live in Asia. The story of the United States is over. A new story belongs to China, he said.
Rogers speaks of a historical evolution: the economic center was in the UK in the 19th century, then the US in the 20th century. It will be Asia in the 21st century and it may well be China.
Rogers moved to Singapore in 2007, saying at the time that "if you were smart in 1807 you moved to London, if you were smart in 1907 you moved to New York, if you were smart in 2007 you moved to Asia."
Rogers reminded his audience that he favours investing in commodities. Silver is 70% or so below its historical highs, coffee is 70% or so, as is sugar, while gold is only 10% off its all time high, he said.
When the global economy recovers, demand for commodities will rise, so will prices. If economies remain weak, governments will print money, and commodity investors can then benefit from the effects of inflation, he said.
Addressing China's stock market, he said investors should be patient and wait for opportunities to buy rather than rush into the market. Rogers is not currently buying Chinese equities but neither is he selling.
House prices in China have surged in many cities, but Rogers says he would not currently buy property especially in Shanghai or Hong Kong.
Posted: Tue September 22, 2009 5:40 pm
INTERNATIONAL. Legendary global investor and chairman of Singapore- based Rogers Holdings, Jim Rogers said Europe and the US have fallen in a vicious circle of issuing bonds leading to inflation, leading to more bonds leading to more inflation.
Speaking at the second China International Financial Services Conference, held at Guangzhou in South China on 10th September, Rogers said that the history of the US government over the last 50 years is one of piling up debt. He says decision maker do not seem to have leaned any lessons as they are repeating the same mistakes.
"I will not buy more US Treasury bonds because the government is constantly printing money," he told his audience.
"The global capital flows are diverting to Asia," said Rogers, adding that China saved up money for a rainy day; as it is now raining, they are spending their savings. The US had no money saved, so it is resorting to printing.
The world will never lack US dollars, he said. The dollar index has fallen to a new low, and will continue to fall, he predicted.
"If the dollar rebounds in the future, I will sell all my US dollars," he said, adding that he will be buying oil, minerals and stock of those companies which are engaged in the real economy.
The US Treasury bond market is a bubble, Rogers said, adding that that he couldn't tell when it will burst. Lending money to creditors for 30 years on an annual return of 3%-4% is very unreasonable.
Rogers predicts the Dollar's status as a world reserve may be reduced over the coming 5-10 years. He sees China, Japan and other Asian countries gradually holding more financial clout and Europe and the US turning into debtors.
My whole family has moved to live in Asia. The story of the United States is over. A new story belongs to China, he said.
Rogers speaks of a historical evolution: the economic center was in the UK in the 19th century, then the US in the 20th century. It will be Asia in the 21st century and it may well be China.
Rogers moved to Singapore in 2007, saying at the time that "if you were smart in 1807 you moved to London, if you were smart in 1907 you moved to New York, if you were smart in 2007 you moved to Asia."
Rogers reminded his audience that he favours investing in commodities. Silver is 70% or so below its historical highs, coffee is 70% or so, as is sugar, while gold is only 10% off its all time high, he said.
When the global economy recovers, demand for commodities will rise, so will prices. If economies remain weak, governments will print money, and commodity investors can then benefit from the effects of inflation, he said.
Addressing China's stock market, he said investors should be patient and wait for opportunities to buy rather than rush into the market. Rogers is not currently buying Chinese equities but neither is he selling.
House prices in China have surged in many cities, but Rogers says he would not currently buy property especially in Shanghai or Hong Kong.