‘Printing money will lead to serious problems down the road,’ says Jim Rogers
INTERNATIONAL. Legendary global investor and chairman of Singapore- based Rogers Holdings, Jim Rogers said on Wednesday the US government’s interventionist economic policy verges on communism.
In an interview with Moneynews’s Dan Mangru, Rogers said: “America now owns the car industry. America owns the mortgage industry. America owns a lot of the insurance industry. Karl Marx must be somewhere standing up in his grave cheering. And why is that? America has become a socialist and maybe even communist nation in many ways,” Rogers said.
Addressing the various stimulus packages introduced by the US government, Rogers suggested that President Bush approved two packages, President Obama one, and now there’s talk of a fourth.
“The first stimulus didn’t work. The second stimulus didn’t work. The third stimulus hasn’t worked,” he said.
Rogers is clearly unhappy with the massive monetary easing the Fed has engineered under Chairman Ben Bernanke and he sees inflation and a currecy crisis as a result of these policies
“Printing money has been tried many times throughout history in many countries,” he said. “It has never worked in the long term; it has never worked in the medium-term. Occasionally, it has worked in the short term.”
“Printing money is going to lead to serious problems down the road,” Rogers added.
The amounts involved are staggering, Rogers said. “They’ve already injected huge amounts of money into the system. The Fed has more than tripled its balance sheet in the past year or so.”
The federal government “has increased its own debt by four, five, six times,” he said.
In an interview with India’s Economic Times Tuesday Rogers was asked what he was hiding in his pocket in reference to when, in a previous interview, he had a sachet of sugar in his pocket to underscore the point of impending shortage about agricultural commodities.
“I do actually have a silver coin in my pocket. I also have a gold coin, but the silver one is probably my better play. If I were a bright young man, I would be buying sugar now and silver, given the state of the world. That’s not a recommendation, but I am just saying I do own some silver. Silver is cheaper than many things on a historic basis and I do own some silver,” Rogers said.
Rogers reiterated his stance on the dollar and his expectation of a currency crisis.
“I am not terribly bullish on the dollar in long term. US dollars are a terribly flawed currency and down the road I hope I don’t own any US dollars. I still own some of them at the moment, but it’s not getting better for the US. The dollar any way is getting worse. The fundamental for commodities continue to improve. The fundamentals for the US dollar do not continue to improve. They are deteriorating.”
“The world is full of currency imbalances and economic trade imbalances would have to be resolved or corrected, one way or the other. So, we are going to have some problems in the currency market. I don’t know when.” said Rogers.
