Is it just me or is Jim on television several times every week lately?
No matter, I'm always willing to watch because he has not often been wrong and he is always entertaining.
I actually just finished re-reading his 2004 book "Hot Commodities" and was surprised to see a reference to already inflated US real estate prices. Rogers was at that time already onto the housing bubble and likely consequences of it in the United States.
With a US default hot and heavy in the news as the CNBC crisis de jour, Rogers spoke yesterday to the WSJ and I've made some notes and attached a link to the video:
- Asked if US Treasuries aren’t still the safe haven, Rogers said this wouldn’t be the first time people have been wrong — Fannie Mae and Freddie Mac were once viewed as perfectly safe
- Politicians need to do something now to fix the debt situation — there is no waiting until the next election.
- The markets aren’t going to put up with the debt situation in the US much longer, and will cut the US off (meaning higher interest rates required for debt funding)
- He is paying zero attention to what the guys in Washington are doing regarding the debt ceiling, zero, none, zilch.
- They will do something to address the debt ceiling, that is not the worry. We need to be worrying about six months from now.
- Somehow the lady interviewing Jim seemed to take the last comment as reassuring (I guess because Rogers sees the problems six months from now not August 2) so Rogers said “Let me make sure you are clear, I am short the American stock market and I’m short the American bond market.”
- The market doesn’t seriously think August 2 is a problem.
- Rogers is short because the US situation continues to deteriorate, debt has skyrocketed, and the US can’t use debt to get them out the next financial mess.
- 30 years ago Scandinavia went through a problem like the US is facing and bit the bullet, faced up to their debt problems and experienced the pain. Now they have the model economies for the world. Japan did the opposite 20 years ago refusing to let anyone fail and Japan has now lost two decades. America is following Japan down the road to 20 lost years
- Rogers is long gold, agriculture, all commodities, short Treasuries, a large US bank, short US tech stocks, short emerging markets.
Source
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