Jim Rogers Warns "We're All Going To Suffer From This Crazy, Crazy Money Printing"

Tyler Durden's picture

Submitted by Tekoa Da Silva via Bull Market Thinking blog,

I was able to reconnect with Jim Rogers this morning out of Spain, legendary co-founder of the Quantum Fund with George Soros, author of Hot Commodities, and chairman of the private Beeland Holdings.

It was an especially powerful interview, as Jim spoke towards the relentless downward pressure on gold, the upward explosion in interest rates, central bank money printing, and how to protect yourself ahead of the disastrous times he sees coming.

When asked if we’re seeing forced liquidation leading the smash down in gold this morning, Jim said,

“We certainly are. There are a lot of leveraged players who are now being forced to sell. Usually when you have this kind of forced liquidation, you’re getting closer to a bottom, maybe not the final bottom, but certainly close to a bottom. I even bought a little bit [today].”

With regard to the intense bearish news stories being published on gold, Jim suggested investors shouldn’t ”Pay [much] attention to other people. I pay attention to what’s going on... Obviously with gold collapsing I know about that - but I don’t listen to other people.”

Over the last few years Jim has spoken extensively on shorting government bonds, and more recently, the 10-year U.S. treasury yield has rocketed higher (with a corresponding collapse in value).  When asked if now is a good time to be covering those short bond positions, he explained that,

“I’m grappling with that question as we speak... I’m not short government bonds, [but rather] I’m short junk bonds on the theory that they will suffer the most when the bond market finally breaks. The junk bonds will go first, [along with] emerging market bonds. So I’m trying to figure out what to do, but I am not covering my shorts [just yet].”

Commenting on the Fed’s historical ability to control the bond market, Jim said,

We’re getting to that point where either one of two things are going to happen; either central banks are going to stop all this [money printing], or the market is going to force them to stop it. It looks like we may be having a juncture of both... where the Fed is getting worried... and at the same time, the market is jumping in and saying, ‘Yes, it’s insane what you’re doing, and this has to end.’ So we may have a healthy convergence of both. And if it’s not ending now, it’s going to end sometime in the next year, because this cannot go on - it’s too insane.”

When asked about the explosive riots occurring in Brazil, Jim warned to prepare for much more, in that,

This is the first time in history where you’ve had all the central banks in the world printing money at the same time. Europe, Japan, America, and the UK, all, are frantically trying to debase their currencies…I’m afraid that in the end, we’re all going to suffer perhaps, worse then we ever have, with inflation, currency turmoil, and higher interest rates. As I say, this has never happened before, it’s never been a good policy in the long run, so I’m afraid we’re all going to suffer for the rest of this decade from this crazy, crazy money printing.”

As a final comment to investors looking to protect themselves from these impending disasters, Jim said,

The way to protect yourself is to own real assets... because that’s the only thing which will protect you as currencies debase.”

 

“If you have money in the financial system and the financial system collapses,” he added, “even though you may have done nothing wrong - you may suffer because somebody else did something wrong. So you need to be very careful about where your assets are in the financial system, or have strict control over them yourself, so that you’re not going to lose them.”

And here is the audio of that interview:

 

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kito's picture

Glad to see people coming around to my side on this issue....people will lack cash first and foremost....it will be scarce..

ATM's picture

The Fed won't allow that to happen. They remember the Depression when there were goods everywhere but no one had any money to buy them.

This next Depression will be exactlyt he opposite. Everyone will have tons of money but there will be no goods to by with it.

 

Landrew's picture

You are not a lone in your thinking my friend. This very,very temporary blip in asset prices will continue down the deflation path shortly. The fast money from the forced liquidation of all assets is over. The attempt to profit from the past is dead. Even the hedge funds have stopped buying real estate. Now we shall see if companies follow stopping the purchase of their own stocks. Borrowing to support their shares will in the end force their liquidation also. 

samcontrol's picture

debt free is a must, like reading and writtting. How many well written folks on here with unpayable debt. "if " the system cracks you will not have to pay your debts, Borrowers will be somewhat pardonned.

Bob Sacamano's picture

"Unless you are very rich, diversification seems to be best."

Tend to agree, but it seems one gets rich with concentrated holdings and stays rich with more diversified holdings.

If you have achieved a level of wealth (debt free with >$3 million assets?), today I would not argue with having a fair amount of cash (30%) and a fair amount of gold/silver (20%) in addition to select plays in stocks (long and short), bonds, and other real assets. 

buzzsaw99's picture

a song for the levered gold longs

Were you there when they crucified my gold?

Were you there when they crucified my gold?

Oh sometimes it causes me to tremble, tremble, tremble

Were you there when they crucified my gold?

Were you there... [/johnny cash]

Yeah, Rogers has nothing to worry about, he's richer than shit. The rest of us will go broke long before he does from following his monotone advice.

MeelionDollerBogus's picture

you obviously missed the parts where Rogers said commodities & gold in particular have had a record 12 years and needed a break, needed to correct and that he felt this was healthy. Frequently then he said he wasn't selling gold and he owned it (and silver). Recently he's said he bought a little. And he always said he hopes he's smart enough to buy more when it goes down. It's down. There ya go.

disabledvet's picture

Jim Rogers was correct. "In 2013 his market would go to shit." this is the biggest collapse in gold prices in history. silver is even worse. glad to hear interest rates are higher just as he predicted!

My Days Are Getting Fewer's picture
We are all suffering from money printing.  We are living in a depression disguised as prosperity.   Real estate is the benchmark:   I just returned from Southern Vermont today, where I have a second home.  Two kinds of property are selling:   those on the bottom rung and those on the top.  The rest of the market is "no bid".  The bottom rung property - good location and offered in 2005 for $125,000 - sold last week for $50,000, with the seller taking a $40,000, 15 year mortgage bearing 4%.  A tiny number of high end properties are getting sold.  Properties that cost $1.5 million to build in 2005 are offered at $950,000 with no bid.  I have followed these markets closely for more than 15 years - the number of offerings is numbing - the prices are distress.   Here in northern New Jersey, houses in top communities are selling, but at 2002 prices. And, the only properties moving are those in the best of repair and maintenance - move in ready - just change out the wallpaper and paint.   My daughter sells real estate in Nirvana, a place within 10 miles of the While House.  Her customers are couples working high end government jobs.  They can assemble W-2s totaling more than $300,000.  But alas, these folks have hardly any downpayment.  The military gets special loans.   Stop printing money - then, all of us will be passengers on the dying rig in the Grapes of Wrath.  Keep printing money - then, paper money will die (reinvented or not).   Don't applaud - all of you bullion holders like me - there will be no joy in any of this.  We are all in survival mode.
otto skorzeny's picture

the last 2 months there have been for-sale signs popping up like crazy in my far-out Chi burb- I think people are believing the MSMs line of "recovery" BS but all they are doing is driving down prices even more by glutting the market. They are throwing up new tract shitbox homes like crazy for $300k+( in IL????) but the banks are only writing loans for new and then dumping those 3% down mortgages  in the govt's lap.

fonzannoon's picture

Otto I feel like I am going insane. I take my dog for walks all over. I can't tell you how many little cape's keep getting knocked down and get replaced by McMansions. Restaurants packed, malls packed, Home depot etc. packed. Less for sale. I sit back sometimes and wonder what the f I am thinking.

kito's picture

Since the gold crash...I'm seeing a big shift in sentiment on here....probably marks the bottom of gold ;)....

DoChenRollingBearing's picture

Bottom will not happen until after my next gold purchase...

ThunderingTurd's picture

Fonz, I hear what you are saying but I think you are exposing yourself to your comfort zone. I agree with you about the "state of the 'burbs," but this is not the real economy or a reflection of the state of 'Merika. It is something totally different.

artless's picture

You're in the NYC metro area, right? If not than my mistake.

Otherwise known as lala land. Nothing is real here or in DC.

Pretty sure I read in those history books that it ramped up pretty well before '29.

And I surely remember 2006-2007 when it was all great guns. Until it wasn't. And that was a blip on the radar.

Full dislcosure: I have nothing.

disabledvet's picture

"new bubbles in new areas" but that's it. i've been to NOVA. the houses that were the big bubble places in the 80's have all gentrified. there are no new buyers. Maryland i hear is good...but the idea that "we're going gangbusters here!" has always been a complete and total falsehood...save for California and Manhattan. you can reinflate a bubble...but you can't keep it that way. eventually someone must purchase said item. if i had a clue "hoo" that went out the door these past six weeks. gold and silver getting hammered is the first shot over the bow of ANY leverage. for ANYTHING. "In God We Trust" here we come.

ebworthen's picture

Smallish metropolitan area in the Intermountain West.

Row after row of empty retail space built right after the crash.

Big bling franchise places opening up, busy for first couple weeks, then slows substantially.

Mom and Pop places going out of business.  Vast stretches of retail storefronts built in the last five years sitting empty rotting.

Oldwood's picture

People are sheep. They only want and buy what they think everyone else wants. Our govenment has been doing a sell job on us for years. Our whole economy is based on marketing to induce to buy everything from ding dongs to stocks. The interest rates and home sales number bump up and everyone want to BTFD. We have been watching it in the stock markets because there is an implied backstop. Its finally sinking in that housing now has a backstop. Of course none of these backstops are real in a sustainable sense, but who cares, as we are all eventually dead, right? We've all been reading the stories about people living in their house for years without payments and the mortgage markets have finally loosened to allow these loans to happen again. Its ON again and will run up until another crash, probably sooner than later. Greed is in play again but disaster is still fresh in our memories so it shouldn't take much to bring all back down again.

howenlink's picture

If Jim Rogers was a young Asian woman I would have a man crush on him.  Seriously, I love listening to his analysis.

howenlink's picture

I guess younger than if Kyle Bass was an Asian woman.

CrazyCooter's picture

I think only ZH could host a genuine "who is hotter" thread pitting Kyle Bass vs Jim Rodgers.

This is a bit too creepy for me ... I will go back to fretting about deflation.

Regards,

Cooter

Jannn's picture

If you're into gold keep your eyes on China..

howenlink's picture

I might add that if you are in China, keep your eyes on gold.  :)

Oldwood's picture

I have a problem with the term "assets". I get the impression that most are thinking stocks when they say assets, but i don't think of anything made of paper or digits as an asset. Even gold presents issues for me as an asset as it doesn't do anything. Admittedly I'm biased as I build things for a living, but for me an asset is something that has useful value. Machinery, materials, land or structures. If we are forced to invest in fiat, it seems to me we are voluntarily tying ourselves to a market that many of us have no control or influence over. Why don't I hear more talk about real assets rather than this crap that bankers and government invented to control us?

samsara's picture

Yes I believe Jim meant Physical Assets.

Financial Assets he said to get out of.
I took that to mean any Electronic Assets.

Land , Au , Phyiscal possessions

TuPhat's picture

You don't hear that much about real assetts because they usually don't hold their value in the long term (PMs are the exception).  The price of real assetts only goes up in an inflationary environment.  Rogers says that the Bernanke will be forced to stop printing but we should put our wealth in real assetts.  Those two things together make for bad advice.  If all the CBs stop printing, deflation will lower the price of real assetts and cash will be king if you can keep it.  When will it all come apart?  I can only guess, but my thought is by the second quarter of 2015.  Thats not to say some things won't get worse before then.  I sold all my GLD and gold miners this week on Monday.  That shows you that I don't have a crystal ball but Monday was better than Friday.  I am still stacking, even though it's a modest stack.

Oldwood's picture

But your reference to "price" infers value based on exchange and not on utility. If we persist in valuing everything in the terms the bankers prefer are we not at a significant disadvantage? People used to buy a home and live in it for their whole lives. They "invested" in their homes as they needed and desired and seldom looked at its impact on resale value. We have now allowed everything to become absolutely commoditized and nothing seems to have "value" beyond the dollar. We have now allowed our very existence to be commoditized by "healthcare" and now Obamacare. The government's intrusion into healthcare will require valuations to be put on each of our lives, based on age, education, earning potential and ultimately social value, much as they are trying to do with imminent domain, where the value of property is appraised on its potential revenue impact to the government. How much is a life worth? How much is yours worth? I hate everything about what has been created as it has destroyed what it means to be human. We are simply spread sheet data and statistics to be used and manipulated.

CrazyCooter's picture

Holy crap. I must have been sleeping on every thread you posted because this is distilled genius.

I struggle to see ObamaCare as either pure lobby victory or a simple step towards confiscating the accumulated wealth of the "silver pelts" in society. Even though, as a professional engineer, I visited the doctor for annual physicals just a month ago only to be in raw SHOCK at the price. My wife and I have decided to pursue some reccomended procedures in a foreign country simply due to COST. And we have insurance.

Costs in the US have to come down, if they don't, it will just be a confiscatory policy moving wealth from the old to someone else.

As an aside, I often comment that CO2 regulation is regulating life, being as we all emit CO2 as a basic life function.

What a mess the future looks to be...

Regards,

Cooter

Vendetta's picture

Had a cracked tooth fixed with a crown .... $2000 please ... 1.25 hrs of work including crown.  Its called financial rape not healthcare

greatbeard's picture

>> Had a cracked tooth fixed with a crown .... $2000

I had extensive cosmetic dentistry done in Mexico.  Crowns were $187 each.  I could have bought the cheaper but I opted for the best quality I could get.

I just broke a tooth here (I need to train myself to stop eating like a starving coyote).  Root canal, crown lengthening, crown, $3,500.  The crown alone was $1,500, eight times the cost in Mexico.  I was planning on going back to Mexico for the procedute but it would have required two trips and I couldn't swing that.  I will be going back in the fall to get the wife two crowns, glasses for both of us, and shrimp tacos and beer.  I'm not into whores, but the local ladies were awfully tempting. 

I shitcanned my medical insurance a couple of years ago.  I have two plans for survival, get major medical here and file for bankrupcy, or go to Mexico and get it done.  I find it repugnant to be forced into pre-considering bankruptcy, but they designed the game.  You can not get fair pricing without an insurance company as a go between.  If you don't have insurance you pay many multiples of what the insurance company would be charged for the same procedure.  Our medical establishment is criminal.

I will say, in defense of the dentists, although the pricing is insane, more than $1,000 per hour, they are highly proficient.

MeelionDollerBogus's picture

get a better dentist. I paid $400 for the same thing with no insurance, $50 with insurance. I'm in Canada but our healthcare does not ever pay the dentist so in this case it's irrelevant.

Yes We Can. But Lets Not.'s picture

Obamacare is control - your health and thus your life in the hands of the statists.

NSA too is control - all your info in the hands of the statists, who will soon enough not hesitate to use it against you and to control you. The knowledge that the Gubmint spys on us already impacts/controls behavior

We are a very, very ill country.

MeelionDollerBogus's picture

your comparison of animal breathing vs burning fuels is invalid. We could cut out all the fuels and still breathe. Maybe better.

css1971's picture

It isn't obamacare that puts a valuation on life, it's the exchange of money for medical care which does that, and that happens in the private sector just as much as the public sector.

What obamacare does is put that valuation into government hands.

Oldwood's picture

Whatwe have is a conversion from a productivity based economy to a specualtion based economy. People used to store wealth in those things that gave them security and they placed value in. Real things that included but were not specific to money. It may have been land or other property, a business or just food stocks and a close knit family and communuity that did it. Now it is money that is owned and printed by government.

MeelionDollerBogus's picture

that was still speculation. Not all tangible assets retain their value, those values change based on innovative abilities & seasonal problems or multi-year cycles of need, divergence, etc., change value. Even with no fiat currencies speculation is required to be a good investor.

 

why should I hold more copper than lumber? Why should I grow more tomato and less asparagus? The market will know & I must figure it out to prosper.

WillyGroper's picture

Healthcare Industrial Complex

MIC

PIC

Water & food next

MeelionDollerBogus's picture

indeed. It's part of a larger pattern of commoditizing the slavery of the world.
If you want to really barf look up "venus project" or "zeitgeist" - it proposes the same thing.
Essentially a world bank with no law, no democracy, no rights, no property and while restricting everything they call it "abundance". While denying all property they dare call this freedom. While denying all trade by denying all ownership they dare call it a "resource based economy" aka RBE even though there's no economy to speak of because it's all centrally controlled, planet-wide.
Shameful & disgusting.

What's really entertaining is when you call out its supporters on how they're going to take our property away to make it theirs, aka "common global heritage".
Like a rapist declaring rape doesn't exist because women have no rights to deny sex, they declare "you can't own property, it was never yours, therefore it is not stealing".
And that's why we have guns.

MeelionDollerBogus's picture

only in specific short-term periods is your advice correct.

Over longer periods of history it's dead wrong.

solidus's picture

I own a retail business (in the building industry no less) and as much as it sucks working retail, we earned a 12.5% ROI last year in a continually crappy environment.  I think this is what he means by an asset.  When high inflation forces us all to be speculators, owning any business will give a critical advantage.

earleflorida's picture

http://www.youtube.com/watch?v=WMO72KRoL4Y

Junk 'DNA' alert?!     http://www.mythofjunkdna.com/     ,...and so, as Pi is unsolvable to rationalize... is not the 'God Gene' hidden away on an island of a 'junk treasure trove', as visable as... "not-seeing-the forest-for-the-trees"?

"ABORT [?Roger's?]!!!"  http://www.youtube.com/watch?v=w05w1XbZTG8

Creepy Lurker's picture

Earle, I think you should put the pipe down. Breathe a little oxygen, thats it.

earleflorida's picture

if only 'oxygen' weren't an excelerant...  http://www.youtube.com/watch?v=NFsCbTZ7eLc

anyone that is, or has been associated with Soros is, 'Full of Shit' ! 

jmo :-))