I've had this sent to me - I've seen it floating around 3x in one day. Maybe I should post it.
comment: anyone not worried has been drinking too much of the koolaid. What is the matter with Jim Rogers?? It's KlusterfucK time, and someone like him shoulda seen that.
I think he's right on agriculture and power generation - but completely incorrect to suggest that airlines and tourism are going to see a lot of profitability. Depends on which way things go, BUT one could reasonably assume that if the military expenditure keeps up to keep up the oil supply than lots of oil is going to go towards those fighter jets. And tourism investment would mean you'd have to support those with very high-end destinations as their assets.
I wonder if this guy really does get how dire things are going to be - he's not even cottoned on to the stagflation!! Jeesh!! What's he gonna say when the market crashes -- you know the really big one coming....
Resources will go up until it gets too expensive to deliver them - and that includes the costs of doing the mining on commodities the rich seem to "prefer" these days.
Big Cat investors are going to be playing a much different game than most players, so consider the source which is of course, Jim Rogers. IMHO, now is not the time to invest - it's all very very volatile and hard to tell what your money (even if buying in Euros) is really worth. I don't think you can really trust an investment advisor on the real state of China either - too many unpredictable factors in China itself- and the stituation with Taiwan may change very soon, too - now that pressure to support it politically is gone.
This is all very interesting - but for my money, I'd still stick with running shoes, bicycles and solar energy.. My tuppance.
Famed investor Jim Rogers sees hard times ahead for the United States - and a big opportunity looming in China.
"I'm extremely worried,"he says.
I have been for a while, but I just see things getting much worse this time around than I expected."
"It is a real danger and, in fact, a probability."
"Anybody who sells to Sears (SHLD, Fortune 500) or Wal-Mart (WMT, Fortune 500) is going to be affected, without question," he says. "Some parts of the Chinese economy are going to be untouched, however. They won't even know America's in recession. They won't care if America falls off the face of the earth."
"But it's not as if the markets haven't figured this out. Remember the old expression: 'Dr. Copper is the best economist in the world.' Well, Dr. Nickel and Dr. Zinc figured out a few months ago what I thought I had figured out, that we were going to have a recession. Nickel is already down 50%. Other commodities may fall more. But I don't see the economics of agriculture being much affected at all. Maybe there will be a few less cotton shirts bought. Maybe there will be a few less tires bought. But the supply is under more duress than the demand."
"Think about the story of gold in the '70s," he says. "Gold went up 600%, and then it started correcting. It went down nearly every month for two years, nearly 50% from the high point. And everybody said, 'Well, that's the end of the gold market. It was just a fluke. It's over.'It scared everybody out. And then gold turned around and went up 850% from that level. This is what happens in markets. But the fundamentals of the secular bull market in commodities are not over any more now than they were for gold in the '70s."
"Those things are going to go way, way, way down,"says Rogers. "The investment banks are down now because of the problems in the credit market. Wait until the effects of the bear market come along. If you just go back and look at other bear markets, investment bank stocks have gone down enormously. We haven't gotten to that stage yet. It's going to bring their balance sheets under duress. This is going to get much worse. But that's where there have been excesses for the past decade or so. And whenever you have a bear market come along the great excesses of the previous period are the ones that get cleaned out the most."