Jim Rogers Bullish on Gold, Silver, Cotton, Coffee, Farmland But Not Stocks

Commodities / Investing 2009 Nov 13, 2009 - 01:15 AM GMT

This week’s guru outlook brings you Jim Rogers. Rogers has become infamous in recent years for his prescient calls on the global meltdown and the commodity boom, but long before that Rogers became famous for co-founding the Quantum Fund with George Soros. Rogers and Soros helped steer the fund to a miraculous 4,200% return over the 10 year span of the fund (see here for the Soros Guru outlook) while the S&P 500 returned just 47%. They ran what is considered to be one of the first truly global macro hedge funds.

Rogers has an interesting outlook currently. He has been very vocal about his inflationary outlook, but doesn’t see the liquidity driven bubbles that some other see forming. In fact, he doesn’t see any bubbles in anything other than the U.S. treasury bond market:

“The only bubble I see forming in the Western world is in the U.S. government bond market. Other than that I don’t see any bubbles going on.”

Rogers, a follower of Austrian economics, absolutely hates that the Fed is bailing out the banks and attempting to print us to prosperity. He thinks the winners in this printing press environment are commodities which he believes are in the middle of a secular boom. Paper assets and the dollar are the losers in Rogers’ scenario of money printing while real assets win. Rogers is a huge bull on gold miners and gold:

“no new large gold mines have been opened in decades. Some of those mines are over 100-years old. They are all depleting. On the other hand, central banks have huge Gold reserves above ground – and they are less interested in selling than in the past.
If you adjust Gold for inflation and go back to its former all-time high in 1980, Gold should be over $2,000 an ounce right now if you want to say it’s reaching new inflation adjusted all-time highs. That does not mean Gold has to get back to a true all-time high. Nothing has to. However, I suspect that given all the money printing in the world, we will see much higher prices for hard assets.”

Despite his optimism regarding gold, Rogers is actually more optimistic about other commodities:

“Despite Gold’s potential, I think I will make more money in other commodities such as silver, cotton, or coffee – all of which are terribly depressed.”

What does Rogers think about the equity markets? He has been very vocal about his investments in China, but isn’t currently buying equities as they reach new highs:

“I am not buying any stock markets around the world right now, they have all gone up a lot and I do not like to buy anything when its been going straight up for a while.”

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Jim Rogers has taught finance at Columbia University's business school and is a media commentator worldwide. He is the author of Adventure Capitalist, Investment Biker, Hot Commodities, A Gift to My Children, and A Bull in China. See his website.

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Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Comments

Ed
15 Nov 09, 21:51

Rogers is an extremists and has no idea what is going on

This report is very late, as everyone and their grandma knows the market is way overvalued. Make no mistake, Rogers has been saying this since Dow 6400, hence he is clueless.

Sorry but Rogers has 0 credibility. He is an extremist and tries to manipulate investor sentiment by his media whoring activities. Rogers wasn't buying stocks at Dow 6400 or anytime since then. Why? Because he is an extremist. He is clueless.

This is a man who rode the coattails of Soros, and on his own is basically lost. Yet, most everyone believes otherwise because they are sheep.

This is a man who calls himself an expert in commodities, yet he doesn't pay attention to technical analysis!!!!

Sorry, but TA is essential for commodities trading.

Nadeem_Walayat
16 Nov 09, 01:27

Soros and Rogers

I would listen to the person who has accumulated the most wealth i.e. Soros.

Though saying that I suspect what Soro's is telling everyone else to do is not EXACTLY what he himself itends on doing ;)

Always make you your own mind up and never take any single source as a reason to act upon.

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