Jim Rogers on CNBC.
27/11/2008
He metioned that the double bottom is holding.
And the Dow rally on bad news.
The turnaround may be here.
http://www.cnbc.com/id/15840232?video=940837006&play=1
Friday, November 28, 2008
Thursday, November 27, 2008
Jim Rogers: They Should Have Let Citi FailBy Alexis GlickThis
Jim Rogers: They Should Have Let Citi FailBy Alexis GlickThis
November 25, 2008 12:38PM
morning legendary investor Jim Rogers joined me on Money for Breakfast for an in depth interview. If the name is not familiar, just Google his name and you’ll see countless articles on him. One of his greatest achievements, although he may disagree, was meeting a man named George Soros, where together they founded the Quantum Fund. In the 10 years after it was launched, they famously returned 4200% while the S&P gained 47%. It was the FIRST truly international fund. Since then, a lot has changed. He moved to Singapore in December of last year because as he said, “moving to Asia now is like moving to New York City in 1907.” He’s an exceptionally bright man who has made many people tons of money along the way. He has aquirky sense of humor, an honesty that is refreshing and holds no punches.
This morning I had the opportunity to get his reaction to the breaking news about the Treasury and Federal Reserve’s two new lending and repurchase facilities to the tune of $800 billion dollars. In hindsight, had they known he was on tv, they may have held back the announcement. He is angry, frustrated and feels that we are digging ourselves into a deeper and deeper hole. He urges us to allow banks and other companies to fail.
http://glickreport.blogs.foxbusiness.com/2008/11/25/jim-rogers-citi-should-have-been-let-to-fail/
Tuesday, November 25, 2008
Rogers Says Dollar to Be ‘Devalued,’ Buys Commodities (Update1)
Rogers Says Dollar to Be ‘Devalued,’ Buys Commodities (Update1)
By Ron Harui and Mike Schneider
Nov. 25 (Bloomberg) -- 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 ICE’s Dollar Index has gained 19 percent since Rogers said in an interview on April 27 he expected a dollar rally “about now.”
The U.S. dollar gained since June 30 against all the 16 most-traded currencies except for the yen as investors fled for the perceived safety of Treasuries after the global financial crisis struck, tipping the world into recession. U.S. politicians are seeking to reverse those gains to revive growth, Rogers said.
The dollar is “going to lose its status as the world’s reserve currency,” Rogers said yesterday in an interview with Bloomberg Television. “It will be devalued and it will go down a lot. These guys in Washington, they want to debase the currency.”
Rogers said that he is buying the Japanese yen. All of the 16 most-active currencies have weakened against the yen this year, with South Korea’s won falling 46 percent as the worst performer.
The ICE’s Dollar Index, which tracks the greenback against the currencies of six major trading partners, fell to 86.053 as of 2:50 p.m. in Tokyo from 86.081 late in New York yesterday. It reached 88.463 on Nov. 21, the highest level since April 2006.
Plan to Exit Dollars
The U.S. currency’s rally has “already lasted several months” and “will probably go into next year,” Rogers said. “What I plan to do sometime during this rally is to get out of the rest of my U.S. dollars.”
“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.”
Democratic lawmakers including Senator Charles Schumer of New York said this weekend they plan to design a package as large as $700 billion and deliver it to President-elect Barack Obama on his first day in office. Obama has called for a large economic- stimulus package, saying the U.S. faces the loss of “millions of jobs” unless immediate steps are taken to stimulate growth and rescue the nation’s automakers.
Buying Commodities
Rogers also is buying commodities, saying their “fundamentals have not been impaired and, in fact, are improved.” He correctly forecast in April 2006 that the oil price would reach $100 a barrel and gold $1,000 an ounce.
“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.”
The Rogers International Commodity Index Total Return has plummeted 52 percent from a record in July, including an 11 percent slide this month. The index has risen 124 percent over the past seven years.
Sugar surged the most in two weeks yesterday amid speculation that higher crude-oil prices will boost demand for alternative fuels, including ethanol made from cane.
Raw-sugar futures for March delivery rose 0.44 cent, or 3.9 percent, to 11.72 cents a pound on ICE Futures U.S. in New York yesterday. The gain was the biggest for a most-active contract since Nov. 4. Sugar has declined in each of the past three weeks.
To contact the reporters on this story: Ron Harui in Singapore at rharui@bloomberg.netMike Schneider in New York at mschneider12@bloomberg.net
Last Updated: November 25, 2008 01:12 EST
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aDkWLPPOXdxs
Jim Rogers Sees Dollar `Devalued,' Likes Commodities: Video
Nov. 25 (Bloomberg) -- Jim Rogers, chairman of Rogers Holdings, talks with Bloomberg's Mike Schneider about the future of the U.S. dollar as an international reserve currency and the outlook for the commodities market.
Rogers, speaking from New York yesterday, also talked about the U.S. government's response to the financial crisis, the outlook for the nation's economy, and his investment strategy. ("Night Talk" airs weeknights on Bloomberg TV. Source: Bloomberg)
00:00 U.S. economy, government bailouts: Citi, GM
09:04 Capital tax, protectionism; Tim Geithner; Fed
15:25 U.S. debt level; crisis impact on China
20:46 Commodities: sugar, cotton; farmer shortages
26:20 Origin of financial crisis; short-selling ban
34:47 Dollar to be "devalued"; commodities a "buy"
39:39 Roger's move to Singapore; future of U.S.
Running time 41:09
Last Updated: November 25, 2008 01:05 EST
mms://media2.bloomberg.com/cache/vJzshG4o708g.asf
http://www.youtube.com/watch?v=mesJRzkUHlU
http://www.youtube.com/watch?v=T3XmsSNt8wo
http://www.youtube.com/watch?v=4KxWAfr4KWI
http://www.youtube.com/watch?v=HDJ3mukRPjo
http://www.youtube.com/watch?v=nnwEsa1wUEE
http://c77mxg.bay.livefilestore.com/y1pXvho1HKuijfrYl8oFobcOMGQgGUQFs9FXIBzHnB3M4qpnpiN7kqTtr99kdDEDPEO91BK7iyy690E6uP_GgfBUw/JimRogers_Bloomberg_2008_11_25_p1.mp4?download
http://c77mxg.bay.livefilestore.com/y1pwnm0FNbldQkVGgb83Ksl5lCTD5AudYvTfxyXUWANJm9Rsr5C1aVtLuEbNiqOwTR8RrhDAZWtUNNEfMO9ANIBXQ/JimRogers_Bloomberg_2008_11_25_p2.mp4?download
http://c77mxg.bay.livefilestore.com/y1poTqrvhs0XOX54NGDU9ac0-z_-sxEbMb-86kBEUZiBOjpmpC5tWlWLEV9RGyFaULWOh_G6NM0-eSC0G6MdnJx_w/JimRogers_Bloomberg_2008_11_25_p3.mp4?download
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http://c77mxg.bay.livefilestore.com/y1pboqlsxut7GlQzzcWGtABCUmeBsrAUvKQ0Abfkyn9eYEkV7PblljfCYd2pFhjE_1px2oPX3w5zsJlbo4for9e2Q/JimRogers_Bloomberg_2008_11_25_p5.mp4?download
26/11/2008
tjhinkh:
America may default on their loan in 1-2years.
South Korea cannot sell US gov bonds as American army is sitting on the north korea border.
Forced liquidation 1929 1974 1873 we have 8-9 period like this in the last 150 years.
Parts of Japan have some empty fields coz there are no farmers to work on them.
Japanese dislike foreigners and especially Chinese Foreigenrs. But they asked the Chinese to farm their fields as there are no farmers.
Head of Fannie Mae is now Obama trusted financial advisor, instead of going to jail.Obama got more money from Fannie Mae.
By Ron Harui and Mike Schneider
Nov. 25 (Bloomberg) -- 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 ICE’s Dollar Index has gained 19 percent since Rogers said in an interview on April 27 he expected a dollar rally “about now.”
The U.S. dollar gained since June 30 against all the 16 most-traded currencies except for the yen as investors fled for the perceived safety of Treasuries after the global financial crisis struck, tipping the world into recession. U.S. politicians are seeking to reverse those gains to revive growth, Rogers said.
The dollar is “going to lose its status as the world’s reserve currency,” Rogers said yesterday in an interview with Bloomberg Television. “It will be devalued and it will go down a lot. These guys in Washington, they want to debase the currency.”
Rogers said that he is buying the Japanese yen. All of the 16 most-active currencies have weakened against the yen this year, with South Korea’s won falling 46 percent as the worst performer.
The ICE’s Dollar Index, which tracks the greenback against the currencies of six major trading partners, fell to 86.053 as of 2:50 p.m. in Tokyo from 86.081 late in New York yesterday. It reached 88.463 on Nov. 21, the highest level since April 2006.
Plan to Exit Dollars
The U.S. currency’s rally has “already lasted several months” and “will probably go into next year,” Rogers said. “What I plan to do sometime during this rally is to get out of the rest of my U.S. dollars.”
“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.”
Democratic lawmakers including Senator Charles Schumer of New York said this weekend they plan to design a package as large as $700 billion and deliver it to President-elect Barack Obama on his first day in office. Obama has called for a large economic- stimulus package, saying the U.S. faces the loss of “millions of jobs” unless immediate steps are taken to stimulate growth and rescue the nation’s automakers.
Buying Commodities
Rogers also is buying commodities, saying their “fundamentals have not been impaired and, in fact, are improved.” He correctly forecast in April 2006 that the oil price would reach $100 a barrel and gold $1,000 an ounce.
“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.”
The Rogers International Commodity Index Total Return has plummeted 52 percent from a record in July, including an 11 percent slide this month. The index has risen 124 percent over the past seven years.
Sugar surged the most in two weeks yesterday amid speculation that higher crude-oil prices will boost demand for alternative fuels, including ethanol made from cane.
Raw-sugar futures for March delivery rose 0.44 cent, or 3.9 percent, to 11.72 cents a pound on ICE Futures U.S. in New York yesterday. The gain was the biggest for a most-active contract since Nov. 4. Sugar has declined in each of the past three weeks.
To contact the reporters on this story: Ron Harui in Singapore at rharui@bloomberg.netMike Schneider in New York at mschneider12@bloomberg.net
Last Updated: November 25, 2008 01:12 EST
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aDkWLPPOXdxs
Jim Rogers Sees Dollar `Devalued,' Likes Commodities: Video
Nov. 25 (Bloomberg) -- Jim Rogers, chairman of Rogers Holdings, talks with Bloomberg's Mike Schneider about the future of the U.S. dollar as an international reserve currency and the outlook for the commodities market.
Rogers, speaking from New York yesterday, also talked about the U.S. government's response to the financial crisis, the outlook for the nation's economy, and his investment strategy. ("Night Talk" airs weeknights on Bloomberg TV. Source: Bloomberg)
00:00 U.S. economy, government bailouts: Citi, GM
09:04 Capital tax, protectionism; Tim Geithner; Fed
15:25 U.S. debt level; crisis impact on China
20:46 Commodities: sugar, cotton; farmer shortages
26:20 Origin of financial crisis; short-selling ban
34:47 Dollar to be "devalued"; commodities a "buy"
39:39 Roger's move to Singapore; future of U.S.
Running time 41:09
Last Updated: November 25, 2008 01:05 EST
mms://media2.bloomberg.com/cache/vJzshG4o708g.asf
http://www.youtube.com/watch?v=mesJRzkUHlU
http://www.youtube.com/watch?v=T3XmsSNt8wo
http://www.youtube.com/watch?v=4KxWAfr4KWI
http://www.youtube.com/watch?v=HDJ3mukRPjo
http://www.youtube.com/watch?v=nnwEsa1wUEE
http://c77mxg.bay.livefilestore.com/y1pXvho1HKuijfrYl8oFobcOMGQgGUQFs9FXIBzHnB3M4qpnpiN7kqTtr99kdDEDPEO91BK7iyy690E6uP_GgfBUw/JimRogers_Bloomberg_2008_11_25_p1.mp4?download
http://c77mxg.bay.livefilestore.com/y1pwnm0FNbldQkVGgb83Ksl5lCTD5AudYvTfxyXUWANJm9Rsr5C1aVtLuEbNiqOwTR8RrhDAZWtUNNEfMO9ANIBXQ/JimRogers_Bloomberg_2008_11_25_p2.mp4?download
http://c77mxg.bay.livefilestore.com/y1poTqrvhs0XOX54NGDU9ac0-z_-sxEbMb-86kBEUZiBOjpmpC5tWlWLEV9RGyFaULWOh_G6NM0-eSC0G6MdnJx_w/JimRogers_Bloomberg_2008_11_25_p3.mp4?download
http://c77mxg.bay.livefilestore.com/y1plDAU4hsNcTii0AOx7xJ7GOOsJOB6sP-abtHNtckTIZw6wjueF5mrNdZ3Cv3ReTn2IFo8HoGm2wN9_c1yc9bbzw/JimRogers_Bloomberg_2008_11_25_p4.mp4?download
http://c77mxg.bay.livefilestore.com/y1pboqlsxut7GlQzzcWGtABCUmeBsrAUvKQ0Abfkyn9eYEkV7PblljfCYd2pFhjE_1px2oPX3w5zsJlbo4for9e2Q/JimRogers_Bloomberg_2008_11_25_p5.mp4?download
26/11/2008
tjhinkh:
America may default on their loan in 1-2years.
South Korea cannot sell US gov bonds as American army is sitting on the north korea border.
Forced liquidation 1929 1974 1873 we have 8-9 period like this in the last 150 years.
Parts of Japan have some empty fields coz there are no farmers to work on them.
Japanese dislike foreigners and especially Chinese Foreigenrs. But they asked the Chinese to farm their fields as there are no farmers.
Head of Fannie Mae is now Obama trusted financial advisor, instead of going to jail.Obama got more money from Fannie Mae.
Monday, November 24, 2008
Rogers: Obama Policies Disastrous
Rogers: Obama Policies Disastrous
Friday, November 21, 2008 10:45 AM
Barack Obama has two policies to speak of, Jim Rogers told attendees at the World Money Show, both of them a disaster for the economy.
"First, he wants to tax capital, just when capital is at its weakest. And second, he wants to protect American jobs."
"The best hope for America is that everything Obama has said so far has just been rhetoric," Rogers says.
Rogers points out that taxing capital to prop up failing businesses is taking money from the competent and give it to the incompetent.
He also figures that the wave of corporate defaults and the U.S. debt level mean that any currency rally will be short-lived.
"Bet against the dollar,” Rogers advises. “And bet against long-term U.S. bonds as well.”
The recent collapse in commodity prices is only temporary, Rogers believes.
"Even if commodities fall for a year or two, it's not the end of the bull market," he says. "Buy gold, cotton and sugar,” and keep an eye on African oil stocks, especially in Angola.
http://moneynews.newsmax.com/streettalk/jim_rogers_obama_policies/2008/11/21/153795.html
Friday, November 21, 2008 10:45 AM
Barack Obama has two policies to speak of, Jim Rogers told attendees at the World Money Show, both of them a disaster for the economy.
"First, he wants to tax capital, just when capital is at its weakest. And second, he wants to protect American jobs."
"The best hope for America is that everything Obama has said so far has just been rhetoric," Rogers says.
Rogers points out that taxing capital to prop up failing businesses is taking money from the competent and give it to the incompetent.
He also figures that the wave of corporate defaults and the U.S. debt level mean that any currency rally will be short-lived.
"Bet against the dollar,” Rogers advises. “And bet against long-term U.S. bonds as well.”
The recent collapse in commodity prices is only temporary, Rogers believes.
"Even if commodities fall for a year or two, it's not the end of the bull market," he says. "Buy gold, cotton and sugar,” and keep an eye on African oil stocks, especially in Angola.
http://moneynews.newsmax.com/streettalk/jim_rogers_obama_policies/2008/11/21/153795.html
Thursday, November 20, 2008
The dollar is a flawed, maybe even doomed currency
The dollar is a flawed, maybe even doomed currency
By Jim Rogers
Published: November 18 2008 02:00 Last updated: November 18 2008 02:00
T he following are excerpts from this week's View from the Markets 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.
FT: Do you see the sell-offs we've seen in commodities as a drastic correction?
JR: Well, we're in a period of forced liquidation of all assets . . . we're getting the business cycle effect on demand right now, certainly, but unless the world's in perpetual economic decline, commodities are the only thing going to come out of this OK.
FT: Does this mean you're actually buying back into commodities at the moment, or is this an area you're standing clear of?
JR: No, no. In October when I started covering my shorts in the US stock market, I started buying Chinese shares, Taiwan shares. I started buying commodities again. No, no, I've added to those positions.
FT: What's your strategy towards emerging market stocks?
JR: My hope is that I'm smart enough and brave enough at some point along the line to buy some of them back. But I'm not even thinking about it right now . . . The world's financial situation is in a mess, and there are a lot of people who have to liquidate. I mean, we must have had 30,000 MBAs flying around the world looking for emerging markets. All of that money has got to come home.
FT: How do you think the world should go about redesigning the regulatory system, and are you worried that we're going to end up with a swing towards over-regulation?
JR: Well, we probably will. The problem is that people like Alan Greenspan would never let the market work . . . For 15 years, under Greenspan, and now Bernanke, they would not let the market work. Had they let Long-Term Capital Management fail, back in 1998, we wouldn't have these problems now, I assure you. Lehman Brothers would have been smashed. Goldman Sachs, Bear Stearns, would have been smashed. We wouldn't have these problems now. That only happened because every time they turned around they propped these guys up, gave them more money, and that's why we have the problem. . . . But now, of course, they're going to blame it on other people and cause more regulations.
FT: You're arguing we need to allow some more big institutions to fail?
JR: One failed. Why didn't they let Fannie Mae and Freddie Mac? I mean, I was short Fannie Mae, and they should have let it fail, go zero. AIG - they should have let it fail. They should have let all of these guys fail, and we would clean out the system . . . What they're doing is, they're taking the assets away from the competent people, giving them to the incompetent people and saying to the incompetent: 'OK, now you can compete with the competent people, with their money.' I mean, this is terrible economics. This is outrageous economics.
http://www.ft.com/cms/s/0/fb9a69aa-b511-11dd-b780-0000779fd18c.html
http://www.youtube.com/watch?v=wKyLFIKmiDs
http://www.youtube.com/watch?v=kjVEr3izFvg
http://c77mxg.bay.livefilestore.com/y1pXkA5HKED6PM-1tz2kay5iNBFyC3gFNAWgTbAXF5gz0zEHRAYQsHSPTM4nDvyVqvikBM0DWkTsD4/Jim_FT_interview_17_11_2008_p1.mp4?download
http://c77mxg.bay.livefilestore.com/y1p613OfJXrLTcBAr0V4keRW0KeV6jZQV6ivxOlP51iMfYKf2PGGUu87QKkfSWktfSBS4cqoAh_vKI/Jim_FT_interview_17_11_2008_p2.mp4?download
20/11/2008
Jim is tsill holding USD. He maybe holding it until next year even.
25/11/2008
This is also the first time that all government and central banks around the world are printing money. Before there was isolated cases not a widespread event.
This would create an inflationary environment later on.
By Jim Rogers
Published: November 18 2008 02:00 Last updated: November 18 2008 02:00
T he following are excerpts from this week's View from the Markets 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.
FT: Do you see the sell-offs we've seen in commodities as a drastic correction?
JR: Well, we're in a period of forced liquidation of all assets . . . we're getting the business cycle effect on demand right now, certainly, but unless the world's in perpetual economic decline, commodities are the only thing going to come out of this OK.
FT: Does this mean you're actually buying back into commodities at the moment, or is this an area you're standing clear of?
JR: No, no. In October when I started covering my shorts in the US stock market, I started buying Chinese shares, Taiwan shares. I started buying commodities again. No, no, I've added to those positions.
FT: What's your strategy towards emerging market stocks?
JR: My hope is that I'm smart enough and brave enough at some point along the line to buy some of them back. But I'm not even thinking about it right now . . . The world's financial situation is in a mess, and there are a lot of people who have to liquidate. I mean, we must have had 30,000 MBAs flying around the world looking for emerging markets. All of that money has got to come home.
FT: How do you think the world should go about redesigning the regulatory system, and are you worried that we're going to end up with a swing towards over-regulation?
JR: Well, we probably will. The problem is that people like Alan Greenspan would never let the market work . . . For 15 years, under Greenspan, and now Bernanke, they would not let the market work. Had they let Long-Term Capital Management fail, back in 1998, we wouldn't have these problems now, I assure you. Lehman Brothers would have been smashed. Goldman Sachs, Bear Stearns, would have been smashed. We wouldn't have these problems now. That only happened because every time they turned around they propped these guys up, gave them more money, and that's why we have the problem. . . . But now, of course, they're going to blame it on other people and cause more regulations.
FT: You're arguing we need to allow some more big institutions to fail?
JR: One failed. Why didn't they let Fannie Mae and Freddie Mac? I mean, I was short Fannie Mae, and they should have let it fail, go zero. AIG - they should have let it fail. They should have let all of these guys fail, and we would clean out the system . . . What they're doing is, they're taking the assets away from the competent people, giving them to the incompetent people and saying to the incompetent: 'OK, now you can compete with the competent people, with their money.' I mean, this is terrible economics. This is outrageous economics.
http://www.ft.com/cms/s/0/fb9a69aa-b511-11dd-b780-0000779fd18c.html
http://www.youtube.com/watch?v=wKyLFIKmiDs
http://www.youtube.com/watch?v=kjVEr3izFvg
http://c77mxg.bay.livefilestore.com/y1pXkA5HKED6PM-1tz2kay5iNBFyC3gFNAWgTbAXF5gz0zEHRAYQsHSPTM4nDvyVqvikBM0DWkTsD4/Jim_FT_interview_17_11_2008_p1.mp4?download
http://c77mxg.bay.livefilestore.com/y1p613OfJXrLTcBAr0V4keRW0KeV6jZQV6ivxOlP51iMfYKf2PGGUu87QKkfSWktfSBS4cqoAh_vKI/Jim_FT_interview_17_11_2008_p2.mp4?download
20/11/2008
Jim is tsill holding USD. He maybe holding it until next year even.
25/11/2008
This is also the first time that all government and central banks around the world are printing money. Before there was isolated cases not a widespread event.
This would create an inflationary environment later on.
Sunday, November 16, 2008
Li’l Iron Ranger Philip Falcone Defends the American Dream
Li’l Iron Ranger Philip Falcone Defends the American Dream
11/13/08 at 2:00 PM
Harbinger Capital Management founder and Times investor Philip Falcone appeared alongside four other billionaire hedge-fund managers — George Soros, Kenneth C. Griffin, John Paulson, and James Simons — in front of the House Committee on Oversight and Government Reform this morning. The group had been called by Representative Henry Waxman to defend their use of leverage and how it may have contributed to the current financial crisis, and Falcone, who had a record year last year, wanted to prove he wasn't just a big swinging dick who spent all his time making money off other people's fears and mistakes and terrorizing the Times: He was a human being, just like anybody else. A working-class, hockey-playing kid from Minnesota who happened to have made good, and could you fault him? It was with some trepidation that he stood to give his prepared opening remarks. "I would just like to take a moment to tell you about myself," he began.
"I was born in Chisholm, Minnesota, population 5,000, on the Iron Range of Minnesota. I was the youngest of nine kids who grew up in a three-bedroom home in a working-class neighborhood. My father is a utility superintendent who never made more that $14,000 a year, while my mother worked in the local shirt factory.
I attended Chisholm Senior High, and went on to Harvard University, where I received an A.B. in Economics in 1984. After college, I went on to pursue my first love, hockey, although an injury cut short a professional hockey career abroad. I then moved to New York and began working as a high-yield bond trader at Kidder, Peabody. A few years later, at the age of 28, I teamed up with a friend to complete a leveraged buyout of a small company in Newark, New Jersey. Unfortunately, the recession in the 1990s made that venture quite difficult. As a result, by 1994, I was so 'financially challenged' that the power in my apartment was shut off because I could not afford to pay the electric bill. That experience, as painful as it was, stayed with me over the years and taught me several valuable lessons that have had a powerful impact on my success as a hedge fund manager.
I take great pride in my upbringing, and it is important for the committee and the public to know that not everyone who runs a large hedge fund was born on Fifth Avenue — that is the beauty of America."
When he finished, the court was silent. Then, from the back of the room, came a lone clap, followed by another clap, that eventually swelled into thundering applause. "All right, Philip!" shouted Coach Shock, who was there to cheer on his Little Iron Ranger. "Order! Order in the court!" shouted Representative Waxman, banging his gavel, and the court again went silent. Then he spoke. "Mr. Falcone, I would like to commend you," he said. "Your presence today has taught me a valuable lesson: forget regulation! Regulation would put a stranglehold on your beautiful spirit, and on the spirits of all of the other young mountain children whose dreams consist of paying $49 million for a porn baron's mansion and amassing the kind of wealth that could support a small nation." He gulped. "Thank you for coming in, sir. I think we all see a little more clearly now."
http://nymag.com/daily/intel/2008/11/lil_iron_ranger_philip_falcone.html
Philip Falcone telling a little bit more about his upbringing
11/13/08 at 2:00 PM
Harbinger Capital Management founder and Times investor Philip Falcone appeared alongside four other billionaire hedge-fund managers — George Soros, Kenneth C. Griffin, John Paulson, and James Simons — in front of the House Committee on Oversight and Government Reform this morning. The group had been called by Representative Henry Waxman to defend their use of leverage and how it may have contributed to the current financial crisis, and Falcone, who had a record year last year, wanted to prove he wasn't just a big swinging dick who spent all his time making money off other people's fears and mistakes and terrorizing the Times: He was a human being, just like anybody else. A working-class, hockey-playing kid from Minnesota who happened to have made good, and could you fault him? It was with some trepidation that he stood to give his prepared opening remarks. "I would just like to take a moment to tell you about myself," he began.
"I was born in Chisholm, Minnesota, population 5,000, on the Iron Range of Minnesota. I was the youngest of nine kids who grew up in a three-bedroom home in a working-class neighborhood. My father is a utility superintendent who never made more that $14,000 a year, while my mother worked in the local shirt factory.
I attended Chisholm Senior High, and went on to Harvard University, where I received an A.B. in Economics in 1984. After college, I went on to pursue my first love, hockey, although an injury cut short a professional hockey career abroad. I then moved to New York and began working as a high-yield bond trader at Kidder, Peabody. A few years later, at the age of 28, I teamed up with a friend to complete a leveraged buyout of a small company in Newark, New Jersey. Unfortunately, the recession in the 1990s made that venture quite difficult. As a result, by 1994, I was so 'financially challenged' that the power in my apartment was shut off because I could not afford to pay the electric bill. That experience, as painful as it was, stayed with me over the years and taught me several valuable lessons that have had a powerful impact on my success as a hedge fund manager.
I take great pride in my upbringing, and it is important for the committee and the public to know that not everyone who runs a large hedge fund was born on Fifth Avenue — that is the beauty of America."
When he finished, the court was silent. Then, from the back of the room, came a lone clap, followed by another clap, that eventually swelled into thundering applause. "All right, Philip!" shouted Coach Shock, who was there to cheer on his Little Iron Ranger. "Order! Order in the court!" shouted Representative Waxman, banging his gavel, and the court again went silent. Then he spoke. "Mr. Falcone, I would like to commend you," he said. "Your presence today has taught me a valuable lesson: forget regulation! Regulation would put a stranglehold on your beautiful spirit, and on the spirits of all of the other young mountain children whose dreams consist of paying $49 million for a porn baron's mansion and amassing the kind of wealth that could support a small nation." He gulped. "Thank you for coming in, sir. I think we all see a little more clearly now."
http://nymag.com/daily/intel/2008/11/lil_iron_ranger_philip_falcone.html
Philip Falcone telling a little bit more about his upbringing
Dollar's Days Numbered; Buy Commodities: Jim Rogers
Dollar's Days Numbered; Buy Commodities: Jim Rogers
Commodities are one of the only viable investment opportunities left and are set to rebound as demand problems take hold, while the outlook for the dollar is bleak, famed investor Jim Rogers said Friday. The dollar's days as the world's reserve currency are numbered, Rogers said at the World Money Show conference in London.
The greenback faces serious devaluation as spiraling national debt and a worsening economic crisis undermine it, he said.
America's growing debt problem is "out of control" and Federal Reserve Chief Ben Bernanke's strategy of printing money is a "terrible policy," he said.
Bernanke "does not understand economics, he does not understand markets … he is going to run those printing presses until we run out of trees," he added.
Commodities 'Through the Roof'
Despite the recent massive declines in oil and other commodities, the asset class is in a bull market caused by ever tightening supply, according to Rogers.
“When supply goes down and demand goes up, that’s a bull market," Rogers said.
"By the time we get to the end of this bull market, commodities will be going through the roof," he said.
"The only place I know where the fundamentals are unimpaired is commodities," he added.
Nearly every oil-producing country has declining reserves, Rogers said. Rogers highlighted Africa as being a key continent for oil exploration going forward. He also speculated that a commodities bull run could last until 2020.
Rogers warned investors against putting money into bonds, saying that would be a "terrible place to invest for a long time to come."
"Stocks at best are going to continue in a big trading range," he added.
The dollar is going to have "serious problems down the road," Rogers said, adding that he is using dollar rallies as opportunities to get out of the currency.
http://www.cnbc.com/id/27717135
16/11/2008
tjhinkh: Africa will be a key continent for oil exploration going forward.
Commodities bull run may last until 2020
Commodities are one of the only viable investment opportunities left and are set to rebound as demand problems take hold, while the outlook for the dollar is bleak, famed investor Jim Rogers said Friday. The dollar's days as the world's reserve currency are numbered, Rogers said at the World Money Show conference in London.
The greenback faces serious devaluation as spiraling national debt and a worsening economic crisis undermine it, he said.
America's growing debt problem is "out of control" and Federal Reserve Chief Ben Bernanke's strategy of printing money is a "terrible policy," he said.
Bernanke "does not understand economics, he does not understand markets … he is going to run those printing presses until we run out of trees," he added.
Commodities 'Through the Roof'
Despite the recent massive declines in oil and other commodities, the asset class is in a bull market caused by ever tightening supply, according to Rogers.
“When supply goes down and demand goes up, that’s a bull market," Rogers said.
"By the time we get to the end of this bull market, commodities will be going through the roof," he said.
"The only place I know where the fundamentals are unimpaired is commodities," he added.
Nearly every oil-producing country has declining reserves, Rogers said. Rogers highlighted Africa as being a key continent for oil exploration going forward. He also speculated that a commodities bull run could last until 2020.
Rogers warned investors against putting money into bonds, saying that would be a "terrible place to invest for a long time to come."
"Stocks at best are going to continue in a big trading range," he added.
The dollar is going to have "serious problems down the road," Rogers said, adding that he is using dollar rallies as opportunities to get out of the currency.
http://www.cnbc.com/id/27717135
16/11/2008
tjhinkh: Africa will be a key continent for oil exploration going forward.
Commodities bull run may last until 2020
Wednesday, November 12, 2008
Hedge fund star Greg Coffey astounds City
Hedge fund star Greg Coffey astounds City
Greg Coffey has decided not to strike out on his own despite having walked out on $250m
Kate Walsh
When Greg Coffey p h o n e d h i s mother last Sunday to tell her about his new job, it was not the news she was expecting.
“What the hell are you doing?” she said. “I wanted to see your name over the door.”
Her reaction was reasonable and was shared by many in the City. In April when the star hedge-fund trader had walked out of his £150m-a-year job at GLG, one of Britain’s biggest hedge funds, it was widely assumed he would set up his own firm. It was the assumption too of the 12 GLG traders who resigned with Coffey to follow him to pastures new.
Instead, the 37-year-old Australian, who had made billions for GLG trading in emerging markets, was joining one of GLG’s rivals, Moore Capital - which has offices in the same building in Curzon Street in London’s Mayfair.
Coffey had been bound to silence by a confidentiality agreement with his new employer until last week, when he explained his motives in an exclusive interview with The Sunday Times.
“When I left I had the intention of launching my own fund,” he said. “I didn’t take this leap just to sit in an office four floors above my former employer. But this is different – Moore is a completely different kettle of fish.”
When Coffey stunned the hedge-fund industry by walking out of GLG – and turning his back on $250m (£160m) in bonuses and share options – it was thought he would create a new firm in his own vision.
Investment banks were looking to fund him in exchange for a stake in his new fund, large investors were lining up to back him, and rival hedge funds were suggesting ways they could work with him.
Everyone wanted a piece of the star trader whose decision to leave GLG had caused its share price to plunge by 15%. Coffey was flattered but his mind was made up: he wanted to strike out on his own.
So his decision to join Moore Capital prompts a question. Is the real reason for his move that he simply couldn’t raise the money to go it alone?
Coffey strongly refutes the idea. “When I resigned from GLG I had significant interest from both existing and new clients looking to be seed investors,” he said.
However, analysts said that with investor appetite for hedge funds at its lowest ever and the credit markets paralysed, Coffey would not have been able to raise as much as he had planned.
One hedge-fund analyst said: “The market expected him to raise about $5 billion but in reality he was probably looking at launching with $2-3 billion. Of course, this is a respectable amount but then ego comes into it: what will people say?”
The analyst added that the option of waiting for the market to improve was viable but impractical. “Coffey could not afford to do nothing - out of loyalty to his team. Unlike him, they are not multimillionaires who could take a year out to redecorate their houses.”
So how did the surprise move come about?
Shortly after resigning, Coffey bumped into Louis Bacon, founder of Moore Capital, in the underground car park of One Curzon Street. The pair had known each other for years and the exchange was casual.
The 51-year-old American said to Coffey: “Hey, Greg, you resigned. What are you going to do now?” Coffey replied: “I want to do what you do.”
More conversations followed, but there was no hard sell - none was needed.
Coffey had admired Bacon since he started working as a trader in 1994. Bacon is known as the King of Macro because of his success in macro trading, which involves making bets on interest rates, currencies and stock indexes.
In many ways, the Australian had modelled himself on Bacon. Both are obsessive traders. Before Bacon travels to any of his residences, here or in America, a photograph is taken of the desk he is working at and everything – from computers to documents – is arranged in exactly the same way at the desk he will be using next.
Coffey’s approach is less fastidious, though his homes in London and Australia are wired up for trading and on any trips elsewhere he has screens shipped out before he leaves.
With a job proposal from Bacon on the table, Coffey spoke to his closest confidants, including his wife, Ania, a former financial analyst with Credit Suisse.
Together the couple would have discussed his new pay packet. At GLG he reportedly earned a bonus of $300m last year alone.
Although Coffey cannot disclose details of his new package, Moore is regarded as a very generous employer – it is highly unlikely he took a pay cut.
One industry source said: “Bacon would have said to him I can pay you what you would make at your own hedge fund.”
Coffey next consulted his investors. They told him they did not care whether he launched his own fund or joined an existing one - as long as he made the most money for them. However, they did expect his new environment to have the best operational infrastructure - meaning risk management and compliance functions – in the industry.
Moore, like GLG, is a large hedge fund with about $20 billion of assets under management. Moore’s operational platforms are highly regarded but Coffey said the firm’s culture was the clincher.
In his view, Moore operates in a way that a hedge fund should be run. As it is not publicly listed, its focus is purely on making money for investors rather than asset-gathering in order to improve returns for shareholders.
Coffey said: “I joined Moore because I could offer existing and new investors the same opportunities as I could on my own, with the added advantage of sitting next to Louis Bacon at Moore, an institution with a 20-year battle-tested risk-management infrastructure.”
Another hedge-fund manager said: “At Moore there is a bias to constraining returns both on the up and the down. In a good year he will be up 20% and in a bad year he will be down 2%-3% but performance never falls radically.”
Joining such a steady ship also held its appeal in these uncertain times.
Coffey is candid about the state of the market: “The amount of risk capital available will be lower, and the money that is available will avoid strategies requiring leverage funding from prime brokers.”
In his new role, Coffey’s trading activity will be as frenetic as ever. He works 20-hour days, trading the Asian markets in the early hours from home. After that he travels into the office in time for the opening bell in London and works until New York closes at 10pm.
At Moore he will share an office with Bacon though he will also sit on the trading floor with his team. Initially, he and Bacon will manage funds together but in time Coffey and his team are expected to launch their own fund.
Had Coffey set up his own company, his time would have been consumed with managing the operational side and dealing with investors. At Moore, apart from handling relationships with a number of his long-term investors, he will be cocooned in an environment where his only concern will be trading and his only objective making money for investors.
In that respect the pressure is on. When Coffey left GLG the combined return over five years from the three funds he managed stood at 42%. However, his largest fund, the emerging-markets fund, is down 30% for the year and last weekend the firm limited the amount investors can withdraw because some of the assets are too illiquid to sell.
His was not the only emerging-markets fund that was hammered by stock-market chaos in countries such as Russia, but Coffey knows that he is not in a relative game.
http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article5113888.ece
Greg Coffey has decided not to strike out on his own despite having walked out on $250m
Kate Walsh
When Greg Coffey p h o n e d h i s mother last Sunday to tell her about his new job, it was not the news she was expecting.
“What the hell are you doing?” she said. “I wanted to see your name over the door.”
Her reaction was reasonable and was shared by many in the City. In April when the star hedge-fund trader had walked out of his £150m-a-year job at GLG, one of Britain’s biggest hedge funds, it was widely assumed he would set up his own firm. It was the assumption too of the 12 GLG traders who resigned with Coffey to follow him to pastures new.
Instead, the 37-year-old Australian, who had made billions for GLG trading in emerging markets, was joining one of GLG’s rivals, Moore Capital - which has offices in the same building in Curzon Street in London’s Mayfair.
Coffey had been bound to silence by a confidentiality agreement with his new employer until last week, when he explained his motives in an exclusive interview with The Sunday Times.
“When I left I had the intention of launching my own fund,” he said. “I didn’t take this leap just to sit in an office four floors above my former employer. But this is different – Moore is a completely different kettle of fish.”
When Coffey stunned the hedge-fund industry by walking out of GLG – and turning his back on $250m (£160m) in bonuses and share options – it was thought he would create a new firm in his own vision.
Investment banks were looking to fund him in exchange for a stake in his new fund, large investors were lining up to back him, and rival hedge funds were suggesting ways they could work with him.
Everyone wanted a piece of the star trader whose decision to leave GLG had caused its share price to plunge by 15%. Coffey was flattered but his mind was made up: he wanted to strike out on his own.
So his decision to join Moore Capital prompts a question. Is the real reason for his move that he simply couldn’t raise the money to go it alone?
Coffey strongly refutes the idea. “When I resigned from GLG I had significant interest from both existing and new clients looking to be seed investors,” he said.
However, analysts said that with investor appetite for hedge funds at its lowest ever and the credit markets paralysed, Coffey would not have been able to raise as much as he had planned.
One hedge-fund analyst said: “The market expected him to raise about $5 billion but in reality he was probably looking at launching with $2-3 billion. Of course, this is a respectable amount but then ego comes into it: what will people say?”
The analyst added that the option of waiting for the market to improve was viable but impractical. “Coffey could not afford to do nothing - out of loyalty to his team. Unlike him, they are not multimillionaires who could take a year out to redecorate their houses.”
So how did the surprise move come about?
Shortly after resigning, Coffey bumped into Louis Bacon, founder of Moore Capital, in the underground car park of One Curzon Street. The pair had known each other for years and the exchange was casual.
The 51-year-old American said to Coffey: “Hey, Greg, you resigned. What are you going to do now?” Coffey replied: “I want to do what you do.”
More conversations followed, but there was no hard sell - none was needed.
Coffey had admired Bacon since he started working as a trader in 1994. Bacon is known as the King of Macro because of his success in macro trading, which involves making bets on interest rates, currencies and stock indexes.
In many ways, the Australian had modelled himself on Bacon. Both are obsessive traders. Before Bacon travels to any of his residences, here or in America, a photograph is taken of the desk he is working at and everything – from computers to documents – is arranged in exactly the same way at the desk he will be using next.
Coffey’s approach is less fastidious, though his homes in London and Australia are wired up for trading and on any trips elsewhere he has screens shipped out before he leaves.
With a job proposal from Bacon on the table, Coffey spoke to his closest confidants, including his wife, Ania, a former financial analyst with Credit Suisse.
Together the couple would have discussed his new pay packet. At GLG he reportedly earned a bonus of $300m last year alone.
Although Coffey cannot disclose details of his new package, Moore is regarded as a very generous employer – it is highly unlikely he took a pay cut.
One industry source said: “Bacon would have said to him I can pay you what you would make at your own hedge fund.”
Coffey next consulted his investors. They told him they did not care whether he launched his own fund or joined an existing one - as long as he made the most money for them. However, they did expect his new environment to have the best operational infrastructure - meaning risk management and compliance functions – in the industry.
Moore, like GLG, is a large hedge fund with about $20 billion of assets under management. Moore’s operational platforms are highly regarded but Coffey said the firm’s culture was the clincher.
In his view, Moore operates in a way that a hedge fund should be run. As it is not publicly listed, its focus is purely on making money for investors rather than asset-gathering in order to improve returns for shareholders.
Coffey said: “I joined Moore because I could offer existing and new investors the same opportunities as I could on my own, with the added advantage of sitting next to Louis Bacon at Moore, an institution with a 20-year battle-tested risk-management infrastructure.”
Another hedge-fund manager said: “At Moore there is a bias to constraining returns both on the up and the down. In a good year he will be up 20% and in a bad year he will be down 2%-3% but performance never falls radically.”
Joining such a steady ship also held its appeal in these uncertain times.
Coffey is candid about the state of the market: “The amount of risk capital available will be lower, and the money that is available will avoid strategies requiring leverage funding from prime brokers.”
In his new role, Coffey’s trading activity will be as frenetic as ever. He works 20-hour days, trading the Asian markets in the early hours from home. After that he travels into the office in time for the opening bell in London and works until New York closes at 10pm.
At Moore he will share an office with Bacon though he will also sit on the trading floor with his team. Initially, he and Bacon will manage funds together but in time Coffey and his team are expected to launch their own fund.
Had Coffey set up his own company, his time would have been consumed with managing the operational side and dealing with investors. At Moore, apart from handling relationships with a number of his long-term investors, he will be cocooned in an environment where his only concern will be trading and his only objective making money for investors.
In that respect the pressure is on. When Coffey left GLG the combined return over five years from the three funds he managed stood at 42%. However, his largest fund, the emerging-markets fund, is down 30% for the year and last weekend the firm limited the amount investors can withdraw because some of the assets are too illiquid to sell.
His was not the only emerging-markets fund that was hammered by stock-market chaos in countries such as Russia, but Coffey knows that he is not in a relative game.
http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article5113888.ece
Soros bets a few quid on Gutnick
Soros bets a few quid on Gutnick
DIAMOND JOE GUTNICK has found a new chum in the form of billionaire investor George Soros. Over the past few weeks, Soros has been throwing a few beans the way of two Australian-based companies, Gutnick's Legend International and another digging hopeful, Sphere Investments.
Soros Fund Management has outlaid about $US8.4 million ($12.5 million) for more than 5 per cent of Gutnick's US-listed Legend, taking his stake to about 10 per cent. Legend, listed on the Over-the-Counter market in the US, is developing a phosphate deposit in the Georgina Basin in Queensland.
Perhaps Soros has heard of Gutnick's ability to go looking for diamonds and come back with gold. Last week Soros, who ranks 99th on the Forbes Rich List with nearly $US9 billion to his name, bought a 5 per cent stake in Sphere, which is planning to develop a $2.1 billion iron ore mine in Mauritania.
Soros, who bought the stake through another of his funds, Quantum Emea, is well known for his uncanny ability to make money when everyone else is having a tough time of it.
In 1992, he famously shorted the pound to earn $1 billion in a single day, leading to the currency losing 20 per cent of its value and prompting a downturn.
http://business.smh.com.au/business/soros-bets-a-few-quid-on-gutnick-20081109-5kvo.html
Soros invested in Legend International and Sphere Investments.
DIAMOND JOE GUTNICK has found a new chum in the form of billionaire investor George Soros. Over the past few weeks, Soros has been throwing a few beans the way of two Australian-based companies, Gutnick's Legend International and another digging hopeful, Sphere Investments.
Soros Fund Management has outlaid about $US8.4 million ($12.5 million) for more than 5 per cent of Gutnick's US-listed Legend, taking his stake to about 10 per cent. Legend, listed on the Over-the-Counter market in the US, is developing a phosphate deposit in the Georgina Basin in Queensland.
Perhaps Soros has heard of Gutnick's ability to go looking for diamonds and come back with gold. Last week Soros, who ranks 99th on the Forbes Rich List with nearly $US9 billion to his name, bought a 5 per cent stake in Sphere, which is planning to develop a $2.1 billion iron ore mine in Mauritania.
Soros, who bought the stake through another of his funds, Quantum Emea, is well known for his uncanny ability to make money when everyone else is having a tough time of it.
In 1992, he famously shorted the pound to earn $1 billion in a single day, leading to the currency losing 20 per cent of its value and prompting a downturn.
http://business.smh.com.au/business/soros-bets-a-few-quid-on-gutnick-20081109-5kvo.html
Soros invested in Legend International and Sphere Investments.
Jim Rogers in Korea
Jim Rogers in Korea
By Yoon Ja-young
Staff Reporter
``My view is that the bond market has peaked. Bonds will be terrible place to be for next 10 to 20 years. I've sold bonds,'' said Jim Rogers, CEO of Rogers Holdings. He said that there are plenty of stocks while commodities are lacking, and added that prices will go up as central banks print more money. He advised investors to dump dollars, bonds and invest in commodities.
Rogers, the 66-year-old who co-founded the Quantum Fund with George Soros, had a bright outlook for Korea's initiative to become a regional financial hub.
``Asia is the place where the money is now. Previous financial centers like London and New York are in decline.'' He pointed out that massive regulations had marred Korea despite the great success story the country had. When backed up by deregulation, it could be a winner.
``Korea has some advantages. It is a huge country with over 45 million people. Plus in my view, I think there will be a merger between north and south, much sooner than people think. If I am right, Korea will be very, very dynamic place.'' He said the natural resources and very cheap labor of North Korea could have a synergistic effect with the strength of the south.
Its location, being right there on the border of China, also gives the country huge competitiveness. ``I don't think China will become a financial center as they have too many regulations.''
He said that the 21st century would be the century of China, and advised people to learn Chinese. ``I know they call themselves Communist, but they are one of the best capitalists.'' He pointed out that Chinese save over 35 percent of their income and work from dawn to dusk, while Americans save only 2 percent.
``Best advice I can give you is to teach your children and grandchildren Chinese. It's going to be the most important language in their lifetime.'' He added that his two little daughters are learning Chinese.
He criticized the bailout programs taken by the U.S. government. ``What's happening in the West now is governments are taking assets away from competent people to give to incompetent people.'' He said it was a terrible weakening of the system, something the Japanese already tried and failed to do in the 1990s.
http://www.koreatimes.co.kr/www/news/biz/2008/11/123_34280.html
12/11/2008
tjhinkh: Jim mentioned that bonds will be a bad investment for the next 10-20 years. Bonds have peaked at about now.
He also mentioned that the North and South Korea may unite. This will be advantageous. North cheap labour and rich in natural resources. And close proximity to China is also a huge advantage.
By Yoon Ja-young
Staff Reporter
``My view is that the bond market has peaked. Bonds will be terrible place to be for next 10 to 20 years. I've sold bonds,'' said Jim Rogers, CEO of Rogers Holdings. He said that there are plenty of stocks while commodities are lacking, and added that prices will go up as central banks print more money. He advised investors to dump dollars, bonds and invest in commodities.
Rogers, the 66-year-old who co-founded the Quantum Fund with George Soros, had a bright outlook for Korea's initiative to become a regional financial hub.
``Asia is the place where the money is now. Previous financial centers like London and New York are in decline.'' He pointed out that massive regulations had marred Korea despite the great success story the country had. When backed up by deregulation, it could be a winner.
``Korea has some advantages. It is a huge country with over 45 million people. Plus in my view, I think there will be a merger between north and south, much sooner than people think. If I am right, Korea will be very, very dynamic place.'' He said the natural resources and very cheap labor of North Korea could have a synergistic effect with the strength of the south.
Its location, being right there on the border of China, also gives the country huge competitiveness. ``I don't think China will become a financial center as they have too many regulations.''
He said that the 21st century would be the century of China, and advised people to learn Chinese. ``I know they call themselves Communist, but they are one of the best capitalists.'' He pointed out that Chinese save over 35 percent of their income and work from dawn to dusk, while Americans save only 2 percent.
``Best advice I can give you is to teach your children and grandchildren Chinese. It's going to be the most important language in their lifetime.'' He added that his two little daughters are learning Chinese.
He criticized the bailout programs taken by the U.S. government. ``What's happening in the West now is governments are taking assets away from competent people to give to incompetent people.'' He said it was a terrible weakening of the system, something the Japanese already tried and failed to do in the 1990s.
http://www.koreatimes.co.kr/www/news/biz/2008/11/123_34280.html
12/11/2008
tjhinkh: Jim mentioned that bonds will be a bad investment for the next 10-20 years. Bonds have peaked at about now.
He also mentioned that the North and South Korea may unite. This will be advantageous. North cheap labour and rich in natural resources. And close proximity to China is also a huge advantage.
Tuesday, November 4, 2008
UBS's Zirin Sees Signs of Stabilizing Credit Markets
UBS's Zirin Sees Signs of Stabilizing Credit Markets
Nov. 3 (Bloomberg) -- Jeremy Zirin, senior equity strategist at UBS Wealth Management, talks with Bloomberg's Betty Liu from New York about his investment strategy, outlook for the credit markets and his recommendation of U.S. equities over global equities. Jim Rogers, chairman of Rogers Holdings, also speaks.
00:00 Performance of S&P, strategy; credit market
01:59 Likes U.S. equities over global equities
Running time 04:14
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a70FgJD_Ag2s
mms://media2.bloomberg.com/cache/vJ0kKHGRYX6o.asf
Nov. 3 (Bloomberg) -- Jeremy Zirin, senior equity strategist at UBS Wealth Management, talks with Bloomberg's Betty Liu from New York about his investment strategy, outlook for the credit markets and his recommendation of U.S. equities over global equities. Jim Rogers, chairman of Rogers Holdings, also speaks.
00:00 Performance of S&P, strategy; credit market
01:59 Likes U.S. equities over global equities
Running time 04:14
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a70FgJD_Ag2s
mms://media2.bloomberg.com/cache/vJ0kKHGRYX6o.asf
Jim Rogers Says Markets May Go `A Lot Further Down'
Jim Rogers Says Markets May Go `A Lot Further Down': Video
Nov. 3 (Bloomberg) -- Jim Rogers, chairman of Rogers Holdings, talks with Bloomberg's Betty Liu in New York about the U.S. government's rescue of troubled banks, the outlook for U.S. stocks and investment strategy. NewEdge-Cube Division's Mark Hawkinson also speaks.
00:00 Need to allow U.S. banks to fail; Japan
04:02 "Close" Fed and "crisis takes care of itself"
05:54 Strategy; gold; "more problems" for markets
08:34 Investing in oil, agriculture; Treasuries
11:23 Picks: China, agriculture, non-U.S. airlines
12:21 "My plan is to get out of the dollar..."
Running time 13:06
Last Updated: November 3, 2008 10:51 EST
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a8OW0fN0Rjfw
mms://media2.bloomberg.com/cache/vCM4wglCjinI.asf
04/11/2008
tjhinkh:
During bad economic times, good companies will try to expand and increase market share while the bad ones go bankrupt.
Jim thinks that this is an old fashioned selling climax. Athough it is a bottom, question remains if it is THE bottom. There may be problem next year or maybe in 2010. Jim is expecting more down from here as the people in Washington do not knwo economics.
There was a broker who thought that there are more dowside to come. This is good -> meaning, when people are still bearish and the market going up that is a good sign.
In 1920's stock rallied from 70 to near 400. And then in 1929, it crashes to 200 (50%) in three months. It the rallied 50% to 300 in five months before going down and down again for three years back to 42.
IMF is going to sell gold and Jim is going to buy gold if it goes to 600 and if it goes to 900 he is going to buy alot too.
Jim buying oil today because the forward futures for oil is 40% premium. He is also buying agriculture and short long term government bonds.
Buying non US airlines, Lufhansa, Iberia, Korean Air, Singapore Air, Japan Airline, SAS.
Plan to get out of US dollar in the next few months. The dollar rally has surprised him. It went up so high so quickly because there are so much US dollar short.
Nov. 3 (Bloomberg) -- Jim Rogers, chairman of Rogers Holdings, talks with Bloomberg's Betty Liu in New York about the U.S. government's rescue of troubled banks, the outlook for U.S. stocks and investment strategy. NewEdge-Cube Division's Mark Hawkinson also speaks.
00:00 Need to allow U.S. banks to fail; Japan
04:02 "Close" Fed and "crisis takes care of itself"
05:54 Strategy; gold; "more problems" for markets
08:34 Investing in oil, agriculture; Treasuries
11:23 Picks: China, agriculture, non-U.S. airlines
12:21 "My plan is to get out of the dollar..."
Running time 13:06
Last Updated: November 3, 2008 10:51 EST
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a8OW0fN0Rjfw
mms://media2.bloomberg.com/cache/vCM4wglCjinI.asf
04/11/2008
tjhinkh:
During bad economic times, good companies will try to expand and increase market share while the bad ones go bankrupt.
Jim thinks that this is an old fashioned selling climax. Athough it is a bottom, question remains if it is THE bottom. There may be problem next year or maybe in 2010. Jim is expecting more down from here as the people in Washington do not knwo economics.
There was a broker who thought that there are more dowside to come. This is good -> meaning, when people are still bearish and the market going up that is a good sign.
In 1920's stock rallied from 70 to near 400. And then in 1929, it crashes to 200 (50%) in three months. It the rallied 50% to 300 in five months before going down and down again for three years back to 42.
IMF is going to sell gold and Jim is going to buy gold if it goes to 600 and if it goes to 900 he is going to buy alot too.
Jim buying oil today because the forward futures for oil is 40% premium. He is also buying agriculture and short long term government bonds.
Buying non US airlines, Lufhansa, Iberia, Korean Air, Singapore Air, Japan Airline, SAS.
Plan to get out of US dollar in the next few months. The dollar rally has surprised him. It went up so high so quickly because there are so much US dollar short.
Monday, November 3, 2008
Soros says crisis underscores need for regulation
Soros says crisis underscores need for regulation
Stephanie Schorow, News Office Correspondent
October 29, 2008
Financier, philanthropist and political activist George Soros told an MIT audience Tuesday that the current financial crisis underscored the need for regulation, even while he warned of the pitfalls of regulation and insisted on the impossibility of predicting the economic future.
"The prevailing perception of the market actually affects the so-called fundamentals that market prices are supposed to impact," Soros said during a wide-ranging conversation moderated by Ricardo Caballero, the Ford International Professor of Economics and head of the Department of Economics. "That is the nature of financial systems. Bubbles are a particular manifestation of this."
Because financial markets are not a "natural" but a "human" phenomenon, "the idea that you should be able to predict the future is nonsense," he told a packed audience in Kresge Auditorium.
"I don't get the market right," admitted Soros, later adding, "The reason I do well is I learn from my mistakes."
Soros said the recent meltdown of global financial markets -- something the former hedge fund manager described in dire terms -- undercut the pervasive belief that markets could be entirely self-regulating. That misconception arose, ironically, from the resolution of past financial crises with regulatory interventions: "These periodic financial crises served as successful tests of the misconception of market fundamentals," he said.
The burst of the housing bubble in the United States was, Soros said, a relatively small event but it was a "detonator that set off a much bigger explosion. And that super bubble has been growing for at least 25 years."
Soros, whose new book is titled "The New Paradigm for Financial Markets," criticized former Federal Reserve Chairman Alan Greenspan for keeping interest rates "too low for too long" and, more fundamentally, for holding fast to the idea that it was better to "pick up the pieces" rather than impose regulations on the market.
Caballero also asked the question that was on the mind of many in the audience: "How do we fix the system?"
Certainly, financial markets will always undergo bubbles and bursts, but "unless the United States leads an international effort to stabilize the system, the system will not continue," Soros asserted.
However, while, "I argue that the ideology that markets are perfect is wrong, regulations are also imperfect, in fact they are more imperfect than the market … you don't want to regulate more than you have to. But I think you have to regulate credit as well as money."
During an audience question and answer session, Soros was questioned about his financial past as well as his analysis. MIT Sloan School of Management student Gary Cao asked Soros about his role during "Black Wednesday" in 1992, when the financier made $1 billion as the British pound collapsed.
"I played by the rules. I was a key member of the market. I was doing what other people in the market were doing, with no negative moral implications," Soros replied. "At the time, as a citizen, I was concerned about making the rules better. And I'm still concerned."
Another questioner noted that Soros had written previous books predicting economic doom. Yes, Soros said amid laughter, he made such predictions in 1987 and 1997 and "the third time the wolf came."
In response to a question about the impact of the financial crises on nascent democracies in volatile areas of the world, Soros sounded a hopeful note, saying that the United States could play a positive role but "for that we have to change fundamentally what we stand for and recognize that … we have an obligation to the world which we have absolutely abandoned."
Yet Soros also said that the United States would cease to be the world's undisputed dominant force. "The veto power that we have in the International Monetary Fund will disappear. We will be downsized. At the same time, hopefully, we will have a better working system and opponents will be more downsized than we will."
http://web.mit.edu/newsoffice/2008/soros-1029.html
http://web.mit.edu/webcast/president/2008/president-soros-new_paradigm-mit-kresge-28oct2008-350k.asx
Stephanie Schorow, News Office Correspondent
October 29, 2008
Financier, philanthropist and political activist George Soros told an MIT audience Tuesday that the current financial crisis underscored the need for regulation, even while he warned of the pitfalls of regulation and insisted on the impossibility of predicting the economic future.
"The prevailing perception of the market actually affects the so-called fundamentals that market prices are supposed to impact," Soros said during a wide-ranging conversation moderated by Ricardo Caballero, the Ford International Professor of Economics and head of the Department of Economics. "That is the nature of financial systems. Bubbles are a particular manifestation of this."
Because financial markets are not a "natural" but a "human" phenomenon, "the idea that you should be able to predict the future is nonsense," he told a packed audience in Kresge Auditorium.
"I don't get the market right," admitted Soros, later adding, "The reason I do well is I learn from my mistakes."
Soros said the recent meltdown of global financial markets -- something the former hedge fund manager described in dire terms -- undercut the pervasive belief that markets could be entirely self-regulating. That misconception arose, ironically, from the resolution of past financial crises with regulatory interventions: "These periodic financial crises served as successful tests of the misconception of market fundamentals," he said.
The burst of the housing bubble in the United States was, Soros said, a relatively small event but it was a "detonator that set off a much bigger explosion. And that super bubble has been growing for at least 25 years."
Soros, whose new book is titled "The New Paradigm for Financial Markets," criticized former Federal Reserve Chairman Alan Greenspan for keeping interest rates "too low for too long" and, more fundamentally, for holding fast to the idea that it was better to "pick up the pieces" rather than impose regulations on the market.
Caballero also asked the question that was on the mind of many in the audience: "How do we fix the system?"
Certainly, financial markets will always undergo bubbles and bursts, but "unless the United States leads an international effort to stabilize the system, the system will not continue," Soros asserted.
However, while, "I argue that the ideology that markets are perfect is wrong, regulations are also imperfect, in fact they are more imperfect than the market … you don't want to regulate more than you have to. But I think you have to regulate credit as well as money."
During an audience question and answer session, Soros was questioned about his financial past as well as his analysis. MIT Sloan School of Management student Gary Cao asked Soros about his role during "Black Wednesday" in 1992, when the financier made $1 billion as the British pound collapsed.
"I played by the rules. I was a key member of the market. I was doing what other people in the market were doing, with no negative moral implications," Soros replied. "At the time, as a citizen, I was concerned about making the rules better. And I'm still concerned."
Another questioner noted that Soros had written previous books predicting economic doom. Yes, Soros said amid laughter, he made such predictions in 1987 and 1997 and "the third time the wolf came."
In response to a question about the impact of the financial crises on nascent democracies in volatile areas of the world, Soros sounded a hopeful note, saying that the United States could play a positive role but "for that we have to change fundamentally what we stand for and recognize that … we have an obligation to the world which we have absolutely abandoned."
Yet Soros also said that the United States would cease to be the world's undisputed dominant force. "The veto power that we have in the International Monetary Fund will disappear. We will be downsized. At the same time, hopefully, we will have a better working system and opponents will be more downsized than we will."
http://web.mit.edu/newsoffice/2008/soros-1029.html
http://web.mit.edu/webcast/president/2008/president-soros-new_paradigm-mit-kresge-28oct2008-350k.asx
Q&A with Investing Legend Jim Rogers
Q&A with Investing Legend Jim Rogers
By Barbara Kiviat
Friday, Oct. 31, 2008
Jim Rogers became an investing legend in the 1970s while running a spectacularly successful hedge fund with George Soros. Since then, the Alabama native has traveled around the world more than once — on motorcycle and in a car — writing about his experiences, and his thoughts on investing, along the way. Last year, he moved to Singapore, to be close to the economic growth engine that is Asia, and also saw the launch of tradeable securities tied to a commodities index he created. TIME's Barbara Kiviat caught up with him by phone while he was on the road from Brussels to Amsterdam to ask him about what he makes of the state of the financial world today.
You were one of the first to call the commodities boom. Now that prices have fallen, has your bullishness changed?
No, no, not in the least. In the past 150 years or so, we've had eight or nine periods where there was forced liquidation of everything, with no regard to the fundamentals. Well, we're in one of those periods. In fact, what's happening now is improving the fundamentals of commodities. Farmers cannot even get loans for fertilizer. Certainly no one is going to get a loan to open a zinc mine. Supply is going down — this is very bullish. We have a decline in demand, but the world is in recession. We presume that is a business cycle.
So if I wanted to make money in oil, how long would my time horizon have to be?
I don't know whether you're going to have to wait six days, six months or six years before oil starts skyrocketing again. I covered a lot of my shorts [i.e., short positions] a couple of weeks ago and bought more commodities; I bought more agricultural commodities. I'm not a very good market timer, but I've been going back into the market. Ask me in a couple of years.
What other commodities have you been buying?
I only buy my indexes. I bought the agricultural index and I bought the general index. I think I'm going to make more money in agriculture than in other things for a while, but I'm not a very good market timer. I'm the world's worst trader.
You're the world's worst trader? You used to run a hedge fund.
Fine, but that doesn't mean I was a good trader. Whatever success I've had in investing has been by finding things that are cheap, buying them and owning them for years. I don't sit around trading. Brokers don't particularly like me.
You own the Swiss franc. With the bailout of Swiss investment bank UBS, how does that change your calculus?
The only thing the Swiss have had to sell for two hundred years has been the soundness of their currency. I, for the first time in my life, have started asking myself questions about the Swiss franc because of the UBS deal. It never occurred to me that the Swiss would do this [the bailout]. I have not started selling my Swiss francs. I have stopped buying them. I'm watching to see how it works out.
How worried are you about the slowdown in China's GDP growth?
I'm not worried at all. China could have a recession, it's not going to be the end of the story. In the 19th century, America had 15 depressions with a "d," a horrible civil war, we had very few human rights, we had no rule of law, we had regular massacres in the street. China will certainly have setbacks along the way. A lot of people think China can't have a recession. That's balderdash. China can have a recession like everybody else. Is it the end of the story? No. If it happens, you buy yourself some more China.
What were the things that made you start shorting financials a couple of years ago?
I could see that they were shams. There was no way Fannie Mae was producing 15% growth every quarter. They had giant derivatives positions, and they couldn't know what they were. I remember being on the telly, telling people that Fannie Mae was going to zero, and they'd say, What the hell are you talking about, that's Fannie Mae. Likewise with the investment banks. I used to sit there and say they're all going to eight [dollars per share]. It was clear that there were 29-year-olds on Wall Street sitting around making $10 million and thinking this was normal. I've been experienced enough to know that this is not reality. I'm still short the investment banks.
Can you quantify how much money you made from those positions?
That's a wonderful question, but you know I'm not going to answer it. I grew up in Demopolis, Alabama, where my parents and grandparents taught me you don't ever talk about how much money you have or how much things cost or how much you make. My grandparents would roll over in their poor graves if they heard me talking like that.
What do you make of the global financial crisis more broadly? Do you think there's still another shoe to drop?
Well, it's not over. It's going to be the worst economic time since the second World War, and that's because we had the worst excesses since the second World War. Certainly in the financial community what the governments are doing — they're making mistakes. In 1929 we had the stock market bubble pop, which was leading to a recession, but then the politicians all over the world made a lot of mistakes and turned what should have been a normal recession into a depression. I see the politicians making mistakes now, which may turn this into much much worse than it should be. The Federal Reserve and Treasury have more than doubled the American debt in the past three months. You and I are going to have to pay this off someday, and it's staggering.
You're not concerned about systemic risk? That if they hadn't taken the steps they did, things might be much worse?
When Lehman Brothers calls up [Treasury Secretary Hank] Paulson, what do you expect them to say? "Gosh, I got to worry about my Maserati or my plane payments?" No. They call up and shriek about systemic risk. Come on. Investment banks have been going bankrupt for hundreds of years and the world has still somehow survived. This approach has never worked. This is what the Japanese did in the 1990s. They refused to let anyone fail. And they had zombie banks and zombie companies. The way the system is supposed to work is when we have bad times, the assets moves from the incompetent to the competent, and then the competent start with renewed strength and the system rebuilds itself.
A lot of very sophisticated investors have lost a lot of money in this market. What is the ordinary investor supposed to do?
They should only be investing in things they themselves know a lot about. They shouldn't be listening to me or anybody else. If you know a lot about cars or fashion or something you should find great investments in that field. You're know a lot more about it than any Wall Streeter or hedge fund manager, because that's your passion.
So people should follow your advice about commodities only if they're farmers?
We all know about cotton. None of us had a clue what a dot-com was, but we all know what orange juice is. Before you go to work every morning, you use cotton and wool and silk and rubber and rice and wheat and corn and orange juice and coffee and sugar. Nobody can understand IBM. The chairman of the board of IBM can never understand IBM completely. It's got hundreds of thousands of employees. All you've got to do with cotton is figure out if there's too much or too little. That is not easy to do, but it is a lot simpler than understanding IBM or Toyota.
Are you riding a motorcycle much these days?
No, you break my heart. I haven't ridden a motorcycle in 10 years. If I had a bike now, I would take my little girls riding. But I've just been doing other things.
http://www.time.com/time/printout/0,8816,1855667,00.html
03/11/2008
tjhinkh: Jim has stopped buying Swiss Franks as the Swiss print money to save UBS.
By Barbara Kiviat
Friday, Oct. 31, 2008
Jim Rogers became an investing legend in the 1970s while running a spectacularly successful hedge fund with George Soros. Since then, the Alabama native has traveled around the world more than once — on motorcycle and in a car — writing about his experiences, and his thoughts on investing, along the way. Last year, he moved to Singapore, to be close to the economic growth engine that is Asia, and also saw the launch of tradeable securities tied to a commodities index he created. TIME's Barbara Kiviat caught up with him by phone while he was on the road from Brussels to Amsterdam to ask him about what he makes of the state of the financial world today.
You were one of the first to call the commodities boom. Now that prices have fallen, has your bullishness changed?
No, no, not in the least. In the past 150 years or so, we've had eight or nine periods where there was forced liquidation of everything, with no regard to the fundamentals. Well, we're in one of those periods. In fact, what's happening now is improving the fundamentals of commodities. Farmers cannot even get loans for fertilizer. Certainly no one is going to get a loan to open a zinc mine. Supply is going down — this is very bullish. We have a decline in demand, but the world is in recession. We presume that is a business cycle.
So if I wanted to make money in oil, how long would my time horizon have to be?
I don't know whether you're going to have to wait six days, six months or six years before oil starts skyrocketing again. I covered a lot of my shorts [i.e., short positions] a couple of weeks ago and bought more commodities; I bought more agricultural commodities. I'm not a very good market timer, but I've been going back into the market. Ask me in a couple of years.
What other commodities have you been buying?
I only buy my indexes. I bought the agricultural index and I bought the general index. I think I'm going to make more money in agriculture than in other things for a while, but I'm not a very good market timer. I'm the world's worst trader.
You're the world's worst trader? You used to run a hedge fund.
Fine, but that doesn't mean I was a good trader. Whatever success I've had in investing has been by finding things that are cheap, buying them and owning them for years. I don't sit around trading. Brokers don't particularly like me.
You own the Swiss franc. With the bailout of Swiss investment bank UBS, how does that change your calculus?
The only thing the Swiss have had to sell for two hundred years has been the soundness of their currency. I, for the first time in my life, have started asking myself questions about the Swiss franc because of the UBS deal. It never occurred to me that the Swiss would do this [the bailout]. I have not started selling my Swiss francs. I have stopped buying them. I'm watching to see how it works out.
How worried are you about the slowdown in China's GDP growth?
I'm not worried at all. China could have a recession, it's not going to be the end of the story. In the 19th century, America had 15 depressions with a "d," a horrible civil war, we had very few human rights, we had no rule of law, we had regular massacres in the street. China will certainly have setbacks along the way. A lot of people think China can't have a recession. That's balderdash. China can have a recession like everybody else. Is it the end of the story? No. If it happens, you buy yourself some more China.
What were the things that made you start shorting financials a couple of years ago?
I could see that they were shams. There was no way Fannie Mae was producing 15% growth every quarter. They had giant derivatives positions, and they couldn't know what they were. I remember being on the telly, telling people that Fannie Mae was going to zero, and they'd say, What the hell are you talking about, that's Fannie Mae. Likewise with the investment banks. I used to sit there and say they're all going to eight [dollars per share]. It was clear that there were 29-year-olds on Wall Street sitting around making $10 million and thinking this was normal. I've been experienced enough to know that this is not reality. I'm still short the investment banks.
Can you quantify how much money you made from those positions?
That's a wonderful question, but you know I'm not going to answer it. I grew up in Demopolis, Alabama, where my parents and grandparents taught me you don't ever talk about how much money you have or how much things cost or how much you make. My grandparents would roll over in their poor graves if they heard me talking like that.
What do you make of the global financial crisis more broadly? Do you think there's still another shoe to drop?
Well, it's not over. It's going to be the worst economic time since the second World War, and that's because we had the worst excesses since the second World War. Certainly in the financial community what the governments are doing — they're making mistakes. In 1929 we had the stock market bubble pop, which was leading to a recession, but then the politicians all over the world made a lot of mistakes and turned what should have been a normal recession into a depression. I see the politicians making mistakes now, which may turn this into much much worse than it should be. The Federal Reserve and Treasury have more than doubled the American debt in the past three months. You and I are going to have to pay this off someday, and it's staggering.
You're not concerned about systemic risk? That if they hadn't taken the steps they did, things might be much worse?
When Lehman Brothers calls up [Treasury Secretary Hank] Paulson, what do you expect them to say? "Gosh, I got to worry about my Maserati or my plane payments?" No. They call up and shriek about systemic risk. Come on. Investment banks have been going bankrupt for hundreds of years and the world has still somehow survived. This approach has never worked. This is what the Japanese did in the 1990s. They refused to let anyone fail. And they had zombie banks and zombie companies. The way the system is supposed to work is when we have bad times, the assets moves from the incompetent to the competent, and then the competent start with renewed strength and the system rebuilds itself.
A lot of very sophisticated investors have lost a lot of money in this market. What is the ordinary investor supposed to do?
They should only be investing in things they themselves know a lot about. They shouldn't be listening to me or anybody else. If you know a lot about cars or fashion or something you should find great investments in that field. You're know a lot more about it than any Wall Streeter or hedge fund manager, because that's your passion.
So people should follow your advice about commodities only if they're farmers?
We all know about cotton. None of us had a clue what a dot-com was, but we all know what orange juice is. Before you go to work every morning, you use cotton and wool and silk and rubber and rice and wheat and corn and orange juice and coffee and sugar. Nobody can understand IBM. The chairman of the board of IBM can never understand IBM completely. It's got hundreds of thousands of employees. All you've got to do with cotton is figure out if there's too much or too little. That is not easy to do, but it is a lot simpler than understanding IBM or Toyota.
Are you riding a motorcycle much these days?
No, you break my heart. I haven't ridden a motorcycle in 10 years. If I had a bike now, I would take my little girls riding. But I've just been doing other things.
http://www.time.com/time/printout/0,8816,1855667,00.html
03/11/2008
tjhinkh: Jim has stopped buying Swiss Franks as the Swiss print money to save UBS.
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