Jim Rogers appeared on the “Money for Breakfast” show on the FOX Business Network yesterday. The CEO of Rogers Holdings was firing on all cylinders as he sat down and talked with Alexis Glick about the problems facing the U.S economy. Rogers warned viewers:

This is a mess developing. Please understand that. If you’re not worried, you should be worried.

After the interview, the Singapore-based investor participated in a roundtable discussion with other notable financial personalities. During this part of the show, Rogers predicted:

We’re ready for a rally. I mean, the market in October and earlier this month has had a huge selling climax. I covered a lot of my shorts. Who knows if I’m right or not. But I expect the market to rally for some time. It may rally into next year. But… this is a false rally. It’s not going to be great. It’s not the end of the problems in America and it’s not the end of the bear market.

I highly recommend watching the interview and subsequent discussion, which can be found here on Alexis Glick’s blog “The Glick Report.”

Source:

Jim Rogers Interview
FOX Business Network, November 25, 2008

Legendary investor Jim Rogers appeared on Bloomberg yesterday, where he discussed the future of the U.S. dollar and his investments. Bloomberg’s Ron Harui and Mike Schneider wrote earlier today:

The U.S. dollar will be “devalued” as policy makers seek to weaken it, undermining the greenback’s role as an international reserve currency, said Jim Rogers, chairman of Rogers Holdings in Singapore.

“They think that if you drive down the value of your money, it makes you more competitive, now that has never worked in history in the long term,” said Rogers…

The dollar is “going to lose its status as the world’s reserve currency,” Rogers said yesterday in a televised interview with Bloomberg News. “It will be devalued and it will go down a lot. These guys in Washington, they want to debase the currency.”

Even though the former partner of George Soros in the legendary Quantum Fund predicts the dollar will be devalued, the U.S. currency has benefitted from the recent turmoil in the global financial system. The greenback has advanced against 15 of the 16 most-traded currencies since the end of June 2008. And the rally could continue for some time. Harui and Schneider wrote:

Rogers predicts the U.S. currency’s rally “will probably go into next year” and said he plans to cut the remainder of his dollar holdings during this period.

“If I were doing it today, and what I have done today, is buy the yen,” Rogers said. “But, it is also an artificial move that’s going on. It’s a difficult problem to find out what is a sound currency.”

In addition to buying Japanese yen, Rogers told Bloomberg News he is buying commodities, claiming that their “fundamentals have not been impaired and, in fact, are improved.” From the piece:

“In mid-October, I started buying commodities, I started buying China and I started buying Taiwan,” he said. “I bought them all, but I’ve been focusing more on agriculture. I mean sugar is 80 percent below its all-time high. It’s astonishing how low some of these prices are.”

Source:

“Rogers Says Dollar to Be `Devalued,’ Buys Commodities (Update2)”
Ron Harui, Mike Schneider
Bloomberg, November 25, 2008

Legendary investor Jim Rogers talked to some British financial publications recently about his latest investment outlook. On Tuesday, the transcript of an exchange between the former partner of George Soros and the Financial Times (UK) appeared on their website. Rogers indicated that he was bearish on the U.S. dollar, going so far as to warn that it might be a “doomed currency.” From the interview:

FT: It’s a year since we last interviewed you. You were aggressively bearish about the dollar, but you thought there would probably be a rebound and you would take that as an opportunity to get further out of the dollar. Have you made a further exit from the dollar?
JR: Not yet, no. And the reason I haven’t is because we’re in a period of forced liquidation of everything. We’ve had only eight or nine periods like this in the past 150 years, where everybody has to reverse their positions on everything. There is a gigantic short position in the dollar and they’re all having to cover as they reverse their positions, so this rout is going to go on much further than I would have expected - to my delight, because then I’ll get to sell at higher prices. I don’t know whether I’ll get out this month or this year even - maybe next year, but I do plan to get out of the rest of my US dollars, because this is an artificial rally caused purely by short covering.
FT: How will you tell when that deleveraging is finally over?
JR: I’m sure I won’t get it right, but I do hope that when there’s a lot of euphoria about the dollar and everybody’s saying, well, see, there’s no problem with the dollar . . . I hope I’m smart enough to recognise it and finally get out of the dollar, because it is a flawed and, maybe, even doomed currency.

The CEO of Rogers Holdings continued to talk about the greenback in a piece by Eoin Gleeson that appeared on the MoneyWeek (UK) website yesterday. Gleeson wrote:

What should investors do about it? “Bet against the dollar. And bet against long-term US bonds as well”. With a wave of corporate defaults likely this year and America’s debt problem spiralling out of control, any rally in the greenback and the US economy this year will be short-lived, he reckons.

The Singapore-based investor also talked about an asset class he knows very well. From the piece:

So what about Roger’s beloved commodities? They’ve taken a pounding along with other asset classes. Well, commodities have collapsed because we are in the midst of a global sell-off of everything, says Rogers. But the recession is only going to make the long-term bull case for commodities even stronger.

With miners struggling to get their hands on loans, they are not going to be opening too many new mines over the next year. It’s the same for farmers. And that means, just like in the thirties and the seventies, that commodities will rebound a lot quicker than shares, and this time they will continue to rise for another 10 to 15 years. “Even if commodities fall for a year or two, it’s not the end of the bull market,” he recently told Resource Investor. So what does he recommend?

“Buy gold, cotton and sugar”. Keep an eye on African oil stocks, - particularly in Angola, which will soon surpass Nigeria as the continent’s largest producer of oil. And, he tells Investors Chronicle, he’s keeping an eye on Taiwan. “I’m just sitting and watching because during this period of forced liquidation, some of these emerging markets are going to go down by more than they should simply because they went up by more than they should have.”

Rogers went into greater detail about emerging markets during his discussion with Investors Chronicle (UK). Jonathan Eley wrote Wednesday:

China is the only emerging market in which he has remained invested recently. “I had sold out of all other emerging markets… because there were all these MBAs on airplanes flying round the world looking for new emerging markets. They were all being over-exploited.”

Yet, Rogers is still keeping an eye out for opportunities. Eley wrote:

What’s on his watchlist? Taiwan is one new candidate. “I’ve never bought Taiwan before in my life, but there is peace now,” he says, referring to the frequent tension between China and its small nationalist neighbour in the past.

He believes that the two Koreas will be unified far sooner than many people think, and points out that despite its vile regime, Myanmar is also starting to open up. “It’s got 70 or 80 million disciplined, educated people, lots of natural resources, and it sits right between India and China. What better location is there than that?”

Outside of Asia, the co-founder of the legendary Quantum Fund thinks Africa has some possibilities. From the piece:

What about Africa, I ask? “There are huge opportunities in Africa. If there were six of me, two of me would be in Africa now. Angola is going to be the largest producer of oil in Africa sometime within the next year or two, overtaking Nigeria. Tanzania is making dramatic changes, too”.

Kilimanjaro Hotel Kempinski Dar es Salaam, Tanzania

Sources:

“The dollar is a flawed, maybe even doomed currency”
Jim Rogers
Financial Times (UK), November 18, 2008

“What Jim Rogers thinks you should buy now”
Eoin Gleeson
MoneyWeek (UK), November 19, 2008

“Jim Rogers on emerging markets”
Jonathan Eley
Investors Chronicle (UK), November 18, 2008

Earlier today, Jim Rogers talked to Bloomberg’s Nina de Roy in London about the outlook for global markets and his investment strategy for agriculture, gold, currencies and U.S. treasuries.

Investment Strategy

If you want to know what I’m doing now, I’ve been buying the yen, as I’ve talked about on Bloomberg before. I’ve been buying commodities, especially agriculture. I’m selling short the United States long-bond, the long-term government bond. Buying some Swiss francs. A little bit of China. A few Chinese shares, a few Taiwan shares. And I’m watching. It’s an interesting time.

Commodities Outlook

Historically, what comes out of periods like this, and lead the new market, will be the things where the fundamentals are unimpaired. The only things where the fundamentals are unimpaired right now are commodities. I mean, fundamentals for commodities are being improved by all of this… So if you want to make money, you buy the things where the fundamentals are still good and positive, and that’s how you make money…

The world’s certainly in recession, and there is a cyclical slowdown. But the secular supply is being damaged even more. Your not going to be able to get any— farmers cannot get loans to expand. Nobody’s going to give you money to open a zinc mine in the next decade. So when we come out of this cyclical decline, you’re going to have even less supply, and the bull market in commodities is going to resume, and that will be the best place to have money.

Gold

I have gold. If gold goes down, I’ll buy more. If it goes up, I’ll buy more. Gold is in a bull market, which has got years to go. But I expect to make more money in agriculture, Nina, than I do in gold. But I own it. Bought some yesterday, as a matter of fact.

You can view the 12 minute 44 second Bloomberg interview here.

Source:

Jim Rogers Interview
Bloomberg, October 24, 2008

Jim Rogers appeared on CNBC earlier today and emphasized that the credit crunch the global financial system is experiencing will contribute to the allure of commodities. From the CNBC website:

The fundamentals for commodities were not affected by government policies that are propagating inflation, Jim Rogers, CEO of Rogers Holdings, told CNBC Wednesday.

“I bought more agriculture this week,” Rogers told “Squawk Box Europe.” “What’s happening is that there will be less supply of everything if we ever come out of (the credit crunch). Nobody can get a loan for a zinc mine or, long term, increase crop production.”

If history is any guide, things to buy are things that are doing fine right now like water treatment companies in Asia or agriculture, Rogers added.

Rogers, who recently moved his young family to Singapore to take advantage of Asia’s bright prospects, also predicted that the Federal Reserve will be lowering interest rates. From CNBC:

Rogers also said that interest-rate cuts are coming.

“I know we are going to get aggressive rate cuts everywhere, that’s why I’m long short-term government bonds in the U.S., but shorting long-term government bonds because it’s not going to help, it’s going to add to inflation,” he said.

Source:

“In Times of ‘Zombie Banks,’ Buy Commodities: Jim Rogers”
CNBC, October 22, 2008

Legendary investor Jim Rogers appeared on CNBC Friday, and talked about a number of topics, including what he’s doing with his money right now. The CEO of Rogers Holdings said:

Well, I have an enormous amount of cash, and I’ve been using it to buy more Japanese yen, more Swiss francs, more agricultural products, and, there’s a liquidation phase going on… where everything is being liquidated. I bought agriculture last week and it’s down this week. You know, they’re selling everything in sight. I’ve covered some shorts, I’ve covered a few shorts here today. That’s what I’m doing with my money now.

Swiss francs

The Singapore-based investor, who correctly called the beginning of the latest commodities boom back in 1999, also discussed investments that perform well during a recovery. Rogers told CNBC viewers:

I’m not sure I want to buy equities when the market caves in. I don’t think equities are going to come out of this on top. Normally when you have a panic, the way you make money is you buy the things where the fundamentals have been unimpaired, and they will lead the market coming out. Most equities, I mean Morgan Stanley, isn’t coming out of this unimpaired. So, I’m buying commodities. Commodities are the only thing I know that are coming out of this unimpaired where supply and demand are still terribly out of balance. And the Japanese yen. And the Swiss franc.

You can view the 6 minute 49 second segment here.

Source:

Jim Rogers Interview
CNBC, October 10, 2008

With all the turmoil going on in the financial markets these days, how is legendary investor Jim Rogers playing his cards? From India’s NDTV this past weekend:

NDTV: Will you buy when there’s blood on the street?
Jim Rogers: If the US and other world stock markets did have a selling climate then I would go for it.
NDTV: But what will you buy in terms of equity asset class?
Jim Rogers: Well, it depends on what goes down the most. I would probably buy stocks of airlines, water treatment, agriculture, and other recession proof companies. The way you are going to get rich in the side market is define by the companies that come through hard times with good results. Those are the companies when you have next bull market that you make a fortune.

The Globe And Mail’s (Canada) Brian Milner also talked about Rogers’ recommendations last Friday:

As for his own investing strategy in these tumultuous times, Mr. Rogers said he is “mainly watching” and recommends that other investors do the same.

But that doesn’t mean he’s sitting on his cash.

Recently, he has been adding more agricultural products, has resumed selectively buying Chinese stocks, invested in the Japanese yen and Swiss franc (he likes the Canadian dollar, too, but doesn’t own it) and shorted the long U.S. government bond. He has also bought some Asian and European airline stocks, as well as Canada’s WestJet Airlines Ltd.

2,000 Yen Banknote

Finally, Peter Koven of the Financial Post (Canada) wrote that same day about whether or not the Singapore-based investor believed the commodities’ boom was still alive:

Mr. Rogers, who famously spent three years driving around the world, argued that most people still “don’t know anything” about commodities despite the boom of the last five years (even saying that less than 100 of the world’s 70,000 mutual funds are focused on them). He pointed out that other resource booms have lasted 15 to 23 years, and there is no reason to think this one will be any different. He figures it could run to around 2018 or 2020.

Of course, the main reason he cited is China. He said the 21st century belongs to the Chinese the way the 20th belonged to America, and practically pleaded with the audience to teach their kids Mandarin. He added that three billion people in Asia want to live like we do, and this will continue to constrain supplies well into the future.

Source:

“Commodity bull run not over yet: Jim Rogers”
NDTV (India), October 4, 2008

“U.S. bailout ‘welfare for the rich’”
Brian Milner
Globe And Mail (Canada), October 3, 2008

“Jim Rogers: Commodities have another decade or longer to run”
Peter Koven
Financial Post (Canada), October 3, 2008

William Hanley of the Financial Post (Canada) caught up with legendary investor Jim Rogers while he was in Canada this week. Despite the U.S. government’s growing interventions in the financial system, the CEO of Rogers Holdings is still skeptical of a positive outcome. Hanley wrote:

“I’m pessimistic because America is in recession and that’s having an effect on Europe and Asia,” he says, adding that the recession will last longer than most and be deeper than most because the U. S. government keeps making mistakes by bailing out one entity after another.

“The 29-year-olds on Wall Street and Bay Street have been driving Maseratis,” Rogers says. “That’s about to change. All these guys are going to have to learn to drive taxis.”

The former partner of George Soros in the Quantum Fund believes there will be quite a few brokers-turned-cabbies due to changes taking place on the financial landscape. Hanley wrote:

“The new financial centre could be in Shanghai or maybe in Singapore,” Rogers says. “I really don’t know where, but it’s shifting from New York and London toward Asia.”

Rogers shared his investment strategy with the Financial Post reporter. From the piece:

He continues to own the commodities themselves, not commodities stocks, because the current drop in natural-resource prices is just a correction that could last a quarter, a half or even a year…

He has been buying shares in some airlines, “a disaster area that’s close to a bottom,” and some beaten-up Chinese stocks… Meanwhile, he is monitoring auto stocks, which may become the next disaster area over the coming years…

Rogers is holding on to the Canadian dollars – “one of the soundest fundamental currencies” — he began buying years ago when he saw the commodities boom unfolding against a much-improved Canadian fiscal backdrop. “And I will be buying more along the line.” But recently he has been buying Swiss francs and yen.

He has been shorting the U. S. long bond in the belief that the growing mountain of U. S. debt and the necessity to print money to finance it means bonds have made a long-term top. “Bonds will be a terrible place to be for many years to come.”

And for years to come, Rogers says, water treatment, agriculture and Chinese tourism will be good places to be. China and India, especially, have huge water problems, food inventories are falling even as farmland is taken out of production and 1.3 billion Chinese are now able to travel freely in the world.

Those are the next big things. The best thing to do now in these clamorous markets, Rogers tells a reporter, might be to do nothing unless you have to. “You might just want to head to the beach.”

Sanya, China
“The Hawaii of Asia”

CEP News’ Christine Wong also got the chance to talk to the Singapore-based investor a few hours ahead of his scheduled speech to the Toronto Chartered Financial Accountants Society. She wrote yesterday:

“The American government is getting it wrong… and bailing out the wrong people.” He accused the U.S. lawmakers behind the bailout plan of trying to “bail out their banking friends.”

He predicted that in two years, when other problems crop up in the U.S. financial system, “the American government will be out of bullets.”

Rogers pronounced that “America is in a recession and the world is in a recession.”

Wong also noted that Rogers isn’t too impressed by the Republican and Democratic candidates for the White House. She wrote:

U.S. presidential candidates Barack Obama and John McCain were also in Rogers’s firing line.

“Neither one of them has a clue. Both would be disastrous” for the U.S. economic recovery, he said.

Sources:

“Contrarian becomes pessimist”
William Hanley
Financial Post (Canada), October 3, 2008

“Canada Will Feel U.S. Problems, But Won’t Suffer as Much, U.S. Investment Guru Says”
Christine Wong
CEP News (Canada), October 2, 2008

Jitendra Kumar Gupta from India’s Business Standard caught up with legendary investor Jim Rogers, who was in Mumbai for the launch of the Birla Sun Life Commodity Equities Fund. From the Standard’s website yesterday:

At the conference and in an interview with Jitendra Kumar Gupta, he shared his outlook on commodities and the world economy. Excerpts:

What is your view on global economy and inflation?
The world economy is in recession and the inflation is going to stay here, it is going to get worse. Some countries lie about it. But, inflation in all countries is going to get worse. The next decade is going to see lot more inflation, which is not good.

In this light, how can one beat inflation and generate higher inflation adjusted returns?
Commodities are the best inflation hedge, better than real estate better than anything else. Nothing can assure you better than commodities, but only if you are good at it. You have to pick the things that go up the most to make more money. Inflation does not cause prices to rise, price rise causes inflation.

Frequently, since the prices of the commodities go up before the inflation numbers, one can stay ahead of inflation. But, if you get it wrong you might do worse. So, investing in those commodities, which are going to go up first or selecting the right commodities, is the key to stay ahead of the inflation and make a lot of money…

Do you think Asian economies are decoupling from the rest of the world?
If you deal with the largest economy you are going to get affected by what is happening in America. If you are in the other sectors in Asia, such as water treatment and agriculture you have decoupled. You do not care what is happening in America.

But, if you sell to Wal-Mart, which is the largest retailer in America, you are going to suffer badly. So, some will decouple and some may not. Since India is such a closed economy, which is a negative as far as I am concerned, in this particular short term, India will suffer less probably than other countries which are more integrated with the world economy.

What is your view on the dollar?
Fundamentally, dollar is a terribly flawed currency. I am pessimistic about the future of the dollar; I expect it to continue to deteriorate over the next two or three decades.

The dollar is rallying at the movement because there are so many pessimists including me. But, I hope to use that rally some time in next year to get better of rest of my dollars. I do not want to own any US dollar. Also, I would not urge you to buy US dollar. Dollar is going to loose its status as world reserve currency.

Some of the OPEC countries have already started and no longer take dollar, like Venezuela no longer accepts dollar. Other countries, like Gulf, are already looking and may be taking a package of basket of currencies instead of dollar. I am not the only one who knows the dollar is in trouble. Anybody who watches the TV knows that the dollar is in trouble.

What is you assessment of the crude oil prices in the short and longer term?
I do not have idea as to where the oil prices are headed in the short to medium term. I do know over the course of the bull market, which perhaps has another 10 years to go, the crude oil price will be much higher.

Your bets in the commodity space?
Agriculture is one thing I will be looking for the next decade or so. Within commodities, I would not say these are the best, but may be sugar, coffee and cotton. I am also starting to look at some of the base metals they are down a lot; starting to look at some of these like silver, copper, zinc and gold.

Also, if you want to invest in Asia, commodities are the best way. Because, no matter what happens, the commodities have to be better, Asia has three billion people and is now involved in the world economy. Besides, in commodities you do not have to worry about corporate governance, central banks, unions, politicians or anything.

With gold prices correcting, do you still advocate buying gold?
I am trying and want to buy some gold. However, whether this is the low in the gold, I have no idea, but if gold goes lower, I will add some more. Gold is something I do not plan to sell. Gold is something I will gift to my children.

How will alternative fuels play?
Many politicians around the world are advocating bio fuel now. It is going to happen whether it is good or bad. There is going to be much more demand for the bio fuel going forward. This is also a reason that I am optimistic about the outlook of agriculture.

Your views on the water potential in Asia?
India and China have huge water problems. Water could be the next big investment. And, the best way is to invest in water companies which clean it, transport or pump it. Find the water companies that solve the water problem and you could be the richest person in India.

Source:

“’The US dollar is in trouble’”
Jitendra Kumar Gupta
Business Standard (India), September 15, 2008

India’s CNBC-TV18 spoke to well-known commodities investor Jim Rogers this morning. Rogers, the author of Hot Commodities, correctly predicted the rally in hard assets that began in 1999. Here are some notable excerpts from the exchange:

CNBC: We have seen commodities decline in the last couple of months, do you think it’s a moment to buy or there is more decline left in the market?
ROGERS: It is better to buy when things are going down rather than when they are going up but I have no idea whether this is the best time. Normally September and October in investment markets are weak months so you are at the right time to start investing in commodities if you have it.

CNBC: What would you buy? Would you buy commodities or funds or into mining companies, what seems best to you?
ROGERS: It depends on your ability. If you know a lot about commodities, you can invest in commodities and that’s difficult in India. If you are a good stock picker then you are much better investing in commodity companies or commodity funds. If you know a good stock picker who runs a fund buy that fund, you will make more money.

CNBC: What are you betting on the non-agro or the agricultural commodities?
ROGERS: I bought agricultural commodities recently. They have gone down and everything has been going down for the last couple of months. I would rather buy agriculture than most things these days.

CNBC: You have never liked US dollar but we have seen a resurge come in to that? How long do you think this would stay?
ROGERS: We are having a rally in the dollar because everybody is bearish on it including me and that always leads to a rally. I don’t know how long it’s going to last but I plan to sell this rally sometime in the next month or a year. I don’t know how long this is going to go but I know that US dollar is a terribly flawed currency and it has got terrible problems down the road.

CNBC: Gold prices have come down from USD 1,034/oz to USD 730/oz, do you think there is more downside left here or would you buy at these levels?
ROGERS: I am going to try to buy little bit of gold today here in India, not a major position. If it continues to go down, I hope I am smart enough to buy more. Gold could go to USD 500/oz and could have a big correction. All markets do that, they have big corrections and they scare everybody but a 50% correction is normal. If it goes down 50%, I hope I am smart enough to buy a lot more.

CNBC: What would you buy as of now?
ROGERS: I recently bought airline stocks, agriculture, Renminbi, Swiss Francs, and Japanese Yen.

CNBC: Do you still believe we are into a bull commodity market and we might see more highs going on from here?
ROGERS: Over the next decade, we are going to see more highs. The world is in a recession now; you may see lower prices for some commodities for a while just as you may see a lot lower prices for a lot of stocks. Of the two classes, I would rather own commodities than stocks because when the economies revive, commodities are going to revive first and go up the most.

Source:

“Invest in commodities now: Jim Rogers”
Moneycontrol.com (India), September 12, 2008