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Jim Rogers: QE3's Already Started! I'm Shorting Stocks, Long Commodities and Currencies
By EconMatters
Jim Rogers, chairman of Rogers Holdings, talks about his investment strategy. from Singapore with Susan Li on Bloomberg Television's "First Up" on Monday 29 Nov. Rogers also comments on Europe's sovereign debt crisis, Federal Reserve monetary policy and the U.S. economy. (Rogers Bloomberg interview video available at our site)
Rogers says he does not pay too much attention to the rating agencies upgrades and downgrades as their track record has left him with very little confidence. Markets may rally on certain short-term fixes or good news, but until some resolution comes to the mountainous sovereign debt, no rally will last.
He also commented that QE3 is already underway if you look at the huge jump up of M2 money supply since August (see chart below). In Rogers words, "they are buying something." He also thinks the world could be better off without the central banks money printing press.
Regarding his current investing strategy, he said he's shorting European stocks, American technology stocks (He is shorting a package of U.S. technology stocks including Microsoft calls), emerging market stocks, but long commodities and currencies (Rogers owns some euros).
(The Rogers Bloomberg interview video is available at our site.)
Related Reading - Jim Rogers Sees Gold Cross $2,000, and My Contrarian View on Silver
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“The trend is evident to a man who has an open mind and reasonably clear sight, for it is never wise for a speculator to fit his facts to his theories. Such a man will, or ought to, know whether it is a bull or a bear market, and if he knows that he knows whether to buy or to sell.”
~ Reminiscences of a Stock Operator
He shorted before the big push up.
Quite clearly he doesn't have the ear of the Fed but he should be proven right in the long term, shouldn't he ?
What did he short before the big push up?
he said he's shorting European stocks, American technology stocks (He is shorting a package of U.S. technology stocks including Microsoft calls), emerging market stocks,
Because the interview was done on 29th, he was obviously already short (big push up was yesterday, the 30th)
French frog seems a little redundant
I'm shorting the Euro and long on Gold,Oil and Silver.
In the micro scale, they goes up and down together which means they hedge each other.
In the long run, I think I'll be right on all of them.
Success for all!
Long commodities because if the FED (and other CBs) print prices will go up, or if the world economy starts to grow prices will go up. The only downside is a worldwide defalationary depression, which Rogers sees zero percent chance of happening in a fiat money world. The final collapse will be a hyperinflationary, Zimbabwe like event. The numbers will get really big this time around.
I am long food, taking physical delivery, stored in five gallon units. Every economic collapse involves a lack of food at some point, and hungry people are angry people. Rogers has said this is the "era of the farmer".
"Long commodities because if the FED (and other CBs) print prices will go up, or if the world economy starts to grow prices will go up."
Well, that would be inflation, no real gains. But, I suppose, beats losses.
Keep in mind that not all commodities will be able to increase much given declining wages and increasing unemployment.
I'm long farming. History tells me that strategies involving the long-term stockpiling of food (over growing/raising it) won't pan out. Give a man a fish... blah, blah...
Hungry people may be a bit angry, but they also become hyper aware of conservation of energy. Despite all the Hollywood depictions, most mass starvations are comprised of quiet desperation (people dying en-route to some place). Not saying that there wont' be stupid marauders, one should exercise appropriate risk-management here, but they won't be around all that long if you even encounter them at all.
Rogers has said this is the "era of the farmer".
I think that his notion of a "farmer" is a bit different. Actually, his notion is anything that's even close to what has historically been called a "farmer." He's talking about the likes of Cargil and Monsanto. Entities like these are going to perish as economies of scale go into full reverse (and govt subsidies dry them up).
In the age of infinite electronic "money", it's good to store your excess wealth in something real. Gold and silver have done a pretty good job preserving wealth through out man's history.
A couple of years of food storage gets you through most collapses, if history is a guide. Producing food for yourself is always good and good for you. It's not easy, but fresh food is the best.
I think Jim Rogers has said that young people should learn to drive tractors vs. getting an MBA. Food production at every level will be important as the ipod economy fades.