Posted on 05/14/2009 6:04:21 PM PDT by Kartographer
Renowned investor Jim Rogers says that the rally in stocks and the dollar will soon end, thanks to the Federal Reserve’s massive easing policy.
“I’m not buying shares anywhere,” he tells Bloomberg TV.
“I’m not selling short yet. But…if it keeps going like this, I’ll have to start selling short eventually. I don’t see the stock market as a great place to be in the next two to three years, maybe even the next decade.”
As for the dollar, “we’re going to have a currency crisis probably this fall or the fall of 2010,” Rogers says.
“It’s been building up for a long time. We’ve had a huge rally in the dollar, an artificial rally. …
The U.S. dollar is a very flawed currency.”
(Excerpt) Read more at moneynews.newsmax.com ...
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Whatever Jim Rogers says is in his own self interest, nobody elses.
He’s not saying anything a lot of other people believe is going to happen, with good reason. We are printing money like water, we are heading towards significant inflation shortly. If the economy improves it will just be inflation, if it does not it will be stagflation (worse).
Start getting long term perishables now. Before the inflation starts kicking in. Once it hits it doesn’t matter if you have it in gold, or in dollars, everything no matter what form, will buy less. People won’t give two craps if you pay in gold or coins or paper, prices will go up regardless and the medium won’t matter. Being able to eat and drink will matter. And to protect what you have and the people you’re responsible for.
We're in a deflationary spiral. The US dollar will maintain "relative" strength against other currencies and prices will continue to drop - not rise (including food). I know that some food products have risen as of late, but that is just the supply chain trying to keep their head above water as long as possible. They can't do it forever.
I'm surprised that Peter Schiff doesn't see the writing on the wall, since his father has been railing against the Fed for years. Does Peter honestly think the Fed wants hyperinflation? No. They want deflation since that creates debt prisoners.
I’m getting my wheelbarrel fixed now while I still can.
No, we're not. Look at the Fed's weekly H.4.1 report (their balance sheet). The money that is being "printed" is being held in excess reserves by the Primary Dealers (big banks) to act as a liability against all of the toxis assets the Fed has been buying at par value.
That $900+ billion dollars is just siting around doing nothing - it's not circulating in the economy, so it can't be causing inflation.
We're in a deflationary spiral right now. Look at all of the things going on around us. The utilization of capacity has been destroyed and the velocity of money has come to a crawl.
Just because the credit markets are tight does not mean they aren’t printing money like water. If you’ve seen what the M3 projections are by people still attempting to track it, it’s nuts.
It must be a pretty flat spiral. The only price changes I ever see are to the upside.
I’d love to know how the markets goes up when the news coming in is bad
foreclosures up market up
more people lose jobs market up
debt is more, market is up
etc
etc
etc
I got out of the market and do not plan to go in anymore in the near future
Section 9 of the report (under Liabilities) shows that the currency in circulation has risen by about $84 billion dollar since last year (M0 - or base). M3 cannot grow substantially without M0 growing substantially.
Not only are we not facing hyperinflation, but we are in the midst of deflation.
The Fed is keeping credit markets tight on purpose (and lying to people about the usefulness of LIBOR).
We are headed into a deflationary depression, much like the 1930's - and for many of the same reasons.
Excellent advice. I would only add that it might be worthwhile to buy non-hybrid seed kits and start a garden ASAP, or when the correct seasonal conditions warrant.
I just received my seed kit today (took 4 months from when I ordered it - but maybe the log-jam has eased up) from AAOOB, the first link provided below, but you can google "Non-hybrid seeds" and find a host of companies specializing in sending these packs out.
An excerpt from their website explaining what non-hybrids are: 100% Non Hybrid seeds allow the self reliant gardener the opportunity to collect seed from his mature plants and save for next season. This process becomes a perpetual garden and becomes your life-time supply of garden seed. Think of the money you can save by buying seed just once.
What about labor costs? They're going down through layoffs, salary reductions, reduced work weeks, benefit cuts, etc.
How about housing? Prices are dropping through the floor.
Commercial Real-estate? Same story.
Look at all of the restaurants around you that are reducing their menu prices to attract customers.
Deflation is all around us.
Original link : Jim Rogers: Food Prices Will Skyrocket
He’s contradicting himself. If the Dollar falls, then stocks will do great as food rises.
The Zimbabwe stock market was up 12,000% recently. Much better returns for Zimbabweans in their stock market than they can score in their banks with interest on their savings.
In other words, massive inflation will see both stocks and food rise in parallel.
But...
What Jim Rogers really sees is deflation. He sees falling stock prices.
Eventually Jim Rogers will figure out the other half of that equation...that food prices are coming down, too.
I cannot afford to be dogmatic regarding which way things will go on the Inflation v. Deflation debate. (ie preparing for both!)
BUT, look at the line you wrote that I have underlined.
The US is the largest debtor country on this entire planet. You know who holds the majority of our debt? China and Petro-nations.
Why wouldn't the US want to devalue their debt? To do otherwise, like you say, would be tantamount to becoming willing indentured servants to the Chi-Coms.
This will not be allowed to happen, imo.
Stock market was 14,000. Now 8500. Deflation.
Oil was $147/barrel. Now $58. Deflation.
Homes are down 40%. Deflation. Shipping costs have plummeted. The Saudi Arabia super-tanker crude run to Japan was $177,000 per day back in July. Today it is $16,000. Deflation.
Salaries are down. Wages are down. Overtime is down. Hours are down. Bonuses are down. Deflation.
New car prices are heavily discounted. Deflation.
New and used aircraft are down 30%. Deflation.
New and used boats are down more than 20%. Deflation. Home mortgage interest rates on refinances are down from over 6% last year to under 5% this year, lowering monthly payments. Deflation.
Tax reciepts are down. Deflation.
Cell phones are down. Deflation.
Watches are cheaper. Deflation.
Office rents are down. Deflation.
Business suits are half price. Deflation.
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Deflation
Oil was $147/barrel. Now $58. Deflation.
Homes are down 40%. Deflation. Shipping costs have plummeted. The Saudi Arabia super-tanker crude run to Japan was $177,000 per day back in July. Today it is $16,000. Deflation.
Salaries are down. Wages are down. Overtime is down. Hours are down. Bonuses are down. Deflation.
New car prices are heavily discounted. Deflation.
New and used aircraft are down 30%. Deflation.
New and used boats are down more than 20%. Deflation. Home mortgage interest rates on refinances are down from over 6% last year to under 5% this year, lowering monthly payments. Deflation.
Tax reciepts are down. Deflation.
Cell phones are down. Deflation.
Watches are cheaper. Deflation.
Office rents are down. Deflation.
Business suits are half price. Deflation.
Deflation Deflation Deflation Deflation Deflation DeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflationDeflation
Deflation
So just to be clear, if I'm reading this correctly, you think deflation? :)
I beg to differ. Monetary metals will hold their purchasing power.
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