Posted on 03/11/2013 4:09:06 PM PDT by Lorianne
Despite the current stock market rally, legendary investor Jim Rogers say the U.S economy is poised for a major crash and is warning investors to protect themselves immediately.
In a riveting interview on Fox Business, Rogers warned Americans not to trust any of the positive economic news coming from world governments.
"I don't trust the data from any government, including the U.S., Rogers said. "We know that governments lie to us. Everybody's printing money, but it cannot go on. This is all artificial."
Rogers, who for years has been an outspoken critic of the Feds policies of "Quantitative Easing" says all the money printing is creating false hope that we are in the middle of some kind of super bull market.
But in reality, he says, "we're living in a fool's paradise."
"The Bank of Japan says it's going to print unlimited amounts of money... Then Mr. Bernanke said I'll match that... I'll print that money too. The Europeans are catching on. You've got money printing going on everywhere and that has never been good for anybody," Rogers said.
Currently, Bernanke and company at the U.S. Fed is buying $1 trillion of Treasury and housing agency bonds each year. That's about $85 billion per month against a budget deficit that is about the same level.
The real risk right now is an all-out 1930s-style currency war that could devastate an entire class of investors who have put their faith in the current economic dogma of endless bailouts and money printing
"It cannot go on," Rogers warns.
(Excerpt) Read more at moneymorning.com ...
Hi Al, I hope you are OK.
I’ve read that as hyperinflation approaches, one should not pay off the mortgage. The theory is that the Lender is contractually obligated to take what is owed. If the value of your dollars is inflated, you will pay off for a lower cost with cheap dollars.
Gwjack
close,
yes, in an inflation you should “lock in” your debt obligations as your costs are lower.
However, your dollars are NOT “inflated”. Your purchasing power is reduced. It is the opposite of what you said. But if you have locked in a contact, then that part becomes less expensive.
One more good reason to know the “abundant life” doesn’t emanate from the economy.
Hi Zeneta, thanks for your comment. I think you are absolutely correct. Although I take my fair share of risk in my assets/investments, I do not want to see if Bernanke can perfectly time the catching of a falling knife. I like to “hedge” my risk a bit. I’ve personally begun “converting” my assets into income producing real estate and consumer staples. I’ve even ventured into direct investments in oil/gas wells as there will be a strong need for energy.
I’m not in metals at this time. What are your thoughts of those?
Gwjack
In fact, rather than paying off the balance of mortgage, I am considering re-financing for a longer term. Also, I will be obtaining mortgages on my three rentals.
Thoughts?
Gwjack
Has he been right about anything?? LOL.
I would avoid metals.
I have mixed feelings on Oil and Gas. I love the cash they can spin out, but with Oil traded in US Dollars, the large Multi-nationals would likely be hurt with a US Dollar rally.
This is the tricky part.
If the US takes a dominant role in world oil/gas/energy production, then the US Dollar will be KING!!!!
Do you see the death of Chavez as upsetting the apple cart? Or will Venezuela’s political instability create a slowdown in their production?
Thank you for your earlier replies.
Gwjack
For more years than I can recall, the logical conclusions never seem to happen the way they should.
More oil from Venezuela is what should happen.
Their oil is crap and costly, but it does make a difference.
If you look at oil as currency, and that currency is in US Dollars, then higher output from Venezuela should weaken the US Dollar. But, it is a question of where those dollars go.
It is no coincidence that horsemeat can now be sold, and voila plus ca change! It was obamaumao who approved it:
http://www.louisville.com/content/obama-administration-oks-horse-meat-americans-opinion-arena
On the menu, and elsewhere it is called “Cheval” (as in Chevalier or horserider). Done properly it is not bad. And now we are Frenchies— yahoo.
obamaumao’s experience is in Dog— and that may be next for chinee or korean export. Boom coming in North Korea (LOL).
Our horse and mule live on grass. It grows for free.
Same here, for the most part. Paying off any real estate loans, stocking up, and becoming almost totally self-sufficient. I do expect to lose a good chunk of savings, even as cash; hence, the reason to get setup now with stuff they cannot be expected to come for.
Rogers called the recent, massive commodities boom earlier than almost anyone. I recall him on Fox Business Saturday 9 years ago begging viewers to buy any metals they could get their hands on - physical gold and silver, futures, stocks, South American mining stocks, etc. Glad I listened. Smart dude.
Ha ha, we have 3 of them, I almost killed my husband when he got them, he traded some hay for them. We’ve had them for about 4 years now and they get ridden about twice a year. I guess if the S does hit the fan I can get to town for supplies if there are any and I actually have saddle bags..
I know it is legal to slaughter horses again but the feds are dragging their feet on approving slaughterhouses in the US. It is probably coming from Mexico.
” it also depends on your time horizon for needing the money “
Good point...
There was a fellow on a late night talk radio show a few months back.
He said that during the peak of the Weimar inflation in Germany, you could buy, with a one ounce gold coin, a WHOLE CITY BLOCK.
That’s a heck of a lot of leverage!
I have swung back and forth on the weight of inflation vs. deflation. I agree with your assessment that the Fed is fighting deflation more than they are worried about inflation. The holiday shopping season was weak in the retailer markets. The recent Walmart memo, the economic 4Q 2012 retraction, continuous high unemployment rate, tax increase in January, Obamacare all are major signs the economy is weak and dubious of Obama and the republicans.
The Stimulus Plan, QE, extended Unemployment benefits and on and on won’t cut through the truth. Deflation shows there aren’t enough dollars in the economy to hold up prices. We haven’t felt the impact of the price of gas but it will only cause more pain.
Thank you. I have argued this point several times on FR when people say: "first thing to do is pay off all your debt". If hyperinflation is looming and your loan interest is fixed, it's the exact opposite of what you want to do.
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