Jim Rogers Has Gold Coins in His Pockets

Jim Rogers, chairman of Rogers Holdings, talks with Bloomberg's Bernard Lo about the global recession, U.S. government bailouts, stocks, and commodities.

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A few highlights:

On the recession/depression:

I know we're going to have a long recession. I know we are going to have the worst time since the 30s. They may turn it in to the 1930s again - there's a very good chance of that. We're going to have civil unrest in the U.S. We're going to have civil unrest in other countries. We're already having civil unrest in many places. This is going to be a mess - be prepared. I hope I'm wrong, but be prepared.

On what he would have done about failing banks:

I would have let them all go bankrupt. The idea that they're spending over a billion dollars on bonuses at AIG is total insanity. They should have let them go bankrupt and they wouldn't have to pay anybody anything. These are bankrupt companies - you don't throw money into a bankrupt company. You give the money to confident people who can start over from a sound and solid base. You don't try to prop up dead companies.

On stocks versus commodities:

Listen, corn cannot go to zero. Natural gas cannot go to zero. Stocks can go to zero. Stocks can go down a lot. But commodities cannot go to zero.

On gold:

I own some gold. I do think that if it goes down I'll buy some more. Remember the IMF is trying to sell its gold. The IMF is one of the largest holders of gold in the world and if they sell their gold, it could conceivabley knock gold down a lot. But, if they do, you better buy all the gold you can because then that will be the bottom of the gold market and we'll get rid of the IMF too because they won't have any money left which is good for the world.But I own gold. I think I'll make more money in other things.

At about the 13:20 mark he pulls a few gold coins out of his pocket.

Comments

[coreopsis:]

Got news for you. This isn't the Obama position...this is the position of the dominant financial thinkers in the country. Why not reflect on that, if your mental aptitude is sufficient...this is what is truly worrying about the situation -- that the faults are systemic and cannot be solved without a fundamental remaking of America. That, sad to say, is unlikely to happen.


On Mar 18 08:59 AM WD216 wrote:

> Right on Jim Rogers! One of the few who can see through the media
> blitz and the Obama team snow job. Kudos for telling it like it is
> and forcasting a logical outcome.

Mar 18 03:50 PM

[coreopsis:]

Not only is it trite to repeat the Reagan comment (showing very little gray matter), it serves no purpose unless you think we should simply eliminate the government: federal, state and local.

While it is likely that you think that (as you have no other brick to throw), you might get a college education and in the process read Leviathan, by Thomas Hobbes.


On Mar 18 09:07 AM Steve in Greensboro wrote:

> We've got zombie banks, like the Japanese and even better than the
> Japanese, we have zombie automakers.
>
> And the current administration thinks revoking SFAS 157, reinstating
> the uptick rule and taxing 100% of the AIG severance packages is
> going to fix things? We apparently also have a zombie government.
>
>
> Quoting Reagan from his first inaugural, "...In this present crisis,
> government is not the solution to our problem; government is the
> problem..."

Mar 18 03:52 PM

[coreopsis:]

To yell 'fire' in the movie theater when there is a fire is quite the proper and civic-minded action. Go ahead, Monsieur l'autruche, bury that head in the sand.


On Mar 18 02:11 PM 88tigers wrote:

>
>
> I've always had a great admiration for Jim Rogers. However "Mr Rogers
> Neighborhood" has changed. To cut to the chase, "he now lives in
> Singapore"! Living there can make one doubt and forget, the amazing
> resolve and resilence of both the US economy and Americans in general.
>
> After this take of him, I confess I've lost a little of my belief
> in his perceptions. Namely "to yell fire in the movie theatre" by
> predicting civil unrest has eroded Mr Roger's character considerablely
> and is the cheapest shot I've ever heard to prop-up commoditity prices!
>
>
> Jean-Paul Cassone'
> Fremont, CA USA

Mar 18 03:56 PM

[nyoneway:]

Wrong, commodities can in fact be '0' or negative in cases where you invest in mining companies and the cost to produce that commodity cost more than market price.

Mar 18 04:09 PM

[APM:]

I hope he is wrong, because I am selfish. But for my children, for the future of this country, I hope he is right.

Mar 18 04:29 PM

[optionsgirl:]

When you buy a mining company, are you buying their product, anymore than you are buying pizza when you buy a restaurant company? You seem to be confused between commodities and miners. Commodities don't go down to 0. Dairy farmers would rather pour milk into the fields than give it away for free. When you see mining companies that have product above the cost of production, you see them 1. Hedge, 2. reduce production, 3. reduce capacity. That's why there are cycles. Right now, natural gas is at a multiyear low after reaching a multiyear high. Expect prices to increase again while rigs decline and investment and costs are controlled and projects are delayed or shuttered.
People will always have to eat, heat their homes, drive, etc. These low prices are temporary.

Jim Rogers is right. He's right that commodities are temporarily low. He's right the U.S. government interventions are negative for our economy ( including causing the lending that started it all, and their failure to adequately monitor CDO's, SIV's etc.-which the SEC should have been monitoring), and he's right that growing countries offer future opportunity.


On Mar 18 04:09 PM nyoneway wrote:

> Wrong, commodities can in fact be '0' or negative in cases where
> you invest in mining companies and the cost to produce that commodity
> cost more than market price.

Mar 18 04:52 PM

[Conan the B...:]

"Jim Rogers is right" on the Recession/Depression.
"Jim Rogers is right" on food Commotities.

JIM ROGERS showed you all of the Gold he owns. HE believes the IMF will sell gold and it will go lower. He doesn't understand that whatever the IMF sells, the Gold market will only dip.

JIM ROGERS is a Total Idiot for wanting to Bankrupt the Entire US Banking system. He doesn't even know that AIG is not a Bank.

Mar 18 05:57 PM

[Conan the B...:]

Make that commodities above.

What is different in the Above Article from his continual Mantra?

Now, on the other side of the coin, you have Buffett.
If stocks go to zero, BRK does also.

Which one do you follow, which one has a Better Vision of the Future?

Mar 18 06:04 PM

[Vox Rationalis:]

Steve in Greensboro wrote:

> Quoting Reagan from his first inaugural, "...In this present crisis,
> government is not the solution to our problem; government is the
> problem..."

And yet Reagan saw fit to expand government spending significantly. Each of the next 5 years saw government spending as a percentage of GDP higher than it was during 1980-81. By this measure, the 12 Reagan-Bush fiscal years are all in the 16 years with the highest federal government spending since WWII. Over Reagan's 8 years, adjusted for inflation, federal government spending grew 23.7% and the national debt grew 111%.

But why bother with reality when you've got rhetoric?

Mar 18 06:30 PM

[12345:]

If the IMF sells - China, Japan, or Saudi Arabia will thank them for the kind offering and gobble it all up.

They can sell smaller portions at a time but it will only slow Golds rise..better off buying what you can now anything under 900 is a gift..it shouldn't be an expectation

Mar 18 08:50 PM

[CLH:]

Rogers has always been a stopped clock who may be right once in 20 years. His advice is useless.

Mar 18 09:30 PM

[growser7:]

Jim Rogers is an idiot? Well, he's a pretty rich and successful idiot. Lord knows how he blundered his way to wealth.

Mar 19 12:31 AM

[curious cat:]

rogers is absolutely wrong about commodities. anyone remember that tulips were once quite valuable? holland: a whole country under water. hmmm, maybe that's what happens when you make a big bet on commodities.

rogers is also wrong about america. when everyone buys insurance in the stock market (puts), the market does not go down. similarly, the more people buying survival gear, guns and gold, the safer i feel. we lucked out and missed the skyscraper from hell (meteorite). now, if the super volcano under jellystone park doesn't explode, we will not need to worry about civil unrest.

Mar 19 12:32 AM

[Conan the B...:]

growser: Read the section on his comments on the Banking system. If the entire System goes belly up, the Great Depression will seem like a garden party.

Yes, It is Total Idiocy to allow the Entire Banking System to Fail.

Do you believe otherwise?

Mar 19 01:34 AM

[Mr. Ed, Jr.:]

There are few who see the big picture better than Jim Rogers. That doesn't mean everything he says now will happen-- new information has a way of changing things, and he is looking farther down the road than most.

I prefer to have his opinion in my back pocket when I invest in something.

Mar 19 04:21 AM

[Conan the B...:]

Mr. Ed, Jr.: I agreed with half of the above Article, disagreed with the impact IMF Gold sales would have, Disagreed with a passion with his view of the Banking System.

He has stated time and time again that his "timing is atrocious". With the Present situation, I took his cue on the Food Commodities and found DAG which Yellowhoard now uses. He went from all commodities to Food. I followed the advice given.

But,

I want ATMs to continue to work.

Mar 19 06:59 AM

[User 371080:]

Many want the ATMs to continue to work. Many want an end to the boom bust cycle created by central banking and fiat currency. Likely the bankers will win out with an even bigger slice of the pie and the ATMs will become extinct when currency becomes obsolete.

Mar 19 10:25 AM

[Conan the B...:]

User371: we agree on that eventuallity, electronic money via Cell Phone is my guess. Encrypted beeps, bells and whistles to Access Bank Accounts, credit cards, whatever. National Broadband will have its uses and you will never be alone(GPS).

Mar 19 11:21 AM

[shti:]

A couple of questions: in case of severe devaluation of the dollar, what is the possibility of stock market collapse? Will stock prices retract severely?

Mar 20 01:26 PM

[Conan the B...:]

The pundits would have you believe that a stock market collapse would be the result.

It may drop temporarily. I believe it will rise thereafter.

The current Bust has been hastened by the relatively strong dollar. Our goods are more expensive abroad, Commodity inversion has created temporary Deflation, etc.

Everything Inflation oriented would rise. Heck, even home prices might rise strictly on Replacement Value.

Hmmm, Homeowners have insurance policies with Replacement Costs embedded. If homes are being priced below the Cost to replace, then a bottom may have been reached.

On the other hand, there may be millions of homeowners who are paying way too much for their Homeowners Policies.

Sorry about the sidetrack, had to put it down before the idea vanished.

Mar 21 10:42 AM