Personal Finance

Jim Rogers: Paramount Advice to All Investors

Posted by Jim Rogers via Michael Campbell's Money Talks

on Tuesday, 30 November 1999 0:00

In the Investment World, Rogers is remarkable. Unusually gifted. He is a legend. 
 
He first became recognized when his Quantum Fund averaged 420% a year over a 10 year period while the S&P 500 averaged just 5% a year. More recently Rogers forecasted the China Boom and the Commodity Boom well before they began. 
 
On May 2012 he remarked during an interview with Forbes Magazine that “there’s going to be a huge shift in American society, American culture, in the places where one is going to get rich. The stock brokers are going to be driving taxis. The smart ones will learn to drive tractors so they can work for the smart farmers. The farmers are going to be driving Lamborghinis.
 

Jim Rogers: Paramount Advice to All Investors

 

 
 1. To avoid making mistakes in this and future investment markets keep an eye on the Federal Reserve and Washington. 
 
“Mr. Bernanke has no clue about economics or currencies, and no clue about how markets work. You have to be very careful and watch those guys. Many people for some reason have some kind of faith, even worship of the Central Bank like they know what they are doing. Its has only been in the past few decades people even knew who Central Bankers were. Nobody knew about these guys 100 years, 80 years ago yet know they have become exalted and that is a bubble. 
 
Fortunately Central Bankers are going to pop and this particular crisis may well lead to it. In America we’ve had 3 Central Banks, the first two disappeared and this one will too in my view. They are making such horrible mistakes. “
 
 2. “The other thing to watch out for is please don’t follow the crowd. When everybody is doing something, especially these days, you have got to go the other way.”  Gold was up 12 years in a row. “I know of no asset in World History that has been up twelve years without a decline. So Gold has been acting very very strange in the last twelve years and It had to go down for a while. Well it has.” 
 
“Be very very careful when something is accepted, this is age old advice but it is especially true in the markets today. Like the Japanese Yen right now, when over 90% are bearish then you have to go the other way.” Jim is long the Japanese Yen. He knows he may not be right but he knows he will have made an intelligent decision. 
 
3. “There is always Extraordinary Change Going On.” Rogers goes further and says that there has been no time in his life when there hasn’t been “Change Confusion & Complexity”.  
 
streetsmartsWriting is his book Street Smarts he makes the point that:
 
“You can take any year you want in history, then look at the world 15 years later and it is nothing, NOTHING,  like it was before”
 
As an example in 1930, 40, 50 we had Depression,  then War, followed by the beginning of suburban America. Just dramatic changes. “Nothing we know today , everything we think is true today is going to have changed 10, 15, 19 years from now. It always, always, always has been and always will be.”

 
4.  ” The world changed in the 1920’s, 30’s,as Capital moved from the UK to the US exacerbated by a financial crisis and mistakes made by the politicians. We have another change taking place in World History right now. This time Capital is moving from the largest Debtor Nations to the largest Creditor Nations in the world  now which are China, Korea, Hong Kong, Taiwan, Singapore, Japan. 
 
The assets are in Asia, you know who the debtors are. You just have to look out the window and you will see some of it.”
 
5. “This is the first time in recorded History when nearly every Major Central Bank is printing money trying to debase their currency.” Japan was first, the US second, then the British followed. We have a lot of money being printed around the world. “If you ask me the US has been the major beneficiary because people are afraid of other currencies at the moment.” I expect this to end very badly because throughout history when you have had artificial money printing it has ended very badly in the country that it has happened. But this time it is happening in the whole World!”
 
“Some people are having a lot of fun right now. If you give me a trillion dollars I will show you a very good time. But I don’t think it is going to last.”
 
I hope you are worried, you should be.”
 
 

About Jim Rogers

In the Investment World, Rogers is remarkable. Unusually gifted. He is a legend. 
 
He first became recognized when his Quantum Fund averaged 420% a year over a 10 year period when the S&P 500 averaged just 5% a year. More recently Rogers forecasted the China Boom and the Commodity Boom well before they began. 
 
On May 2012 he remarked during an interview with Forbes Magazine that “there’s going to be a huge shift in American society, American culture, in the places where one is going to get rich. The stock brokers are going to be driving taxis. The smart ones will learn to drive tractors so they can work for the smart farmers. The farmers are going to be driving Lamborghinis.