More Jim Rogers. This video even better (scroll down). Pay close attention to his comments on oil as he explains the problems we are facing in very simple terms.
– China will have many setbacks but it will keep rising.
– As recently as 1907 the US went bankrupt; China will have big problems too, but they will work through it.
– China has over $3 trillion in reserves; America is the largest debtor in history.
– If your brother-in-law spends all his money over and over someone will tell him to wake up, someone will have to do that for America. The market will do that and do it fairly soon, he suspects within the next five years.
– The result will be the dollar collapsing and interest rates going through the roof. Only way to avoid it is by cutting spending with an axe.
– No country in history has gotten out of the situation America is in without a crisis.
– The Japanese are still no better off by not letting anyone go bankrupt. It didn’t work there and won’t work in the United States either.
– There is too much regulation in the States. That is why you see most new IPOs taking place offshore.
– The American bankers never learn their lesson because they are continuously bailed out. They should have let Long Term Capital Management go bankrupt in 1998 and let the market work. That set a bad precedent that keeps getting repeated.
– In his own portfolio he is long commodities, long currencies and short American tech companies.
– Thinks tech is excessively priced and since he wants to have short exposure he feels this is the best place to be short.
– Is Facebook overvalued? Rogers doesn’t have a clue because he can’t see their financial statements.
– Expects silver to have several sell-offs in the coming years on a long march upwards.
– Gold has been up for 10 years and 10 quarters in a row. Bound to have corrections but sees it continuing up for several years.
– Thinks Bernanke saying quantitative easing hasn’t caused commodity inflation is ludicrous.
– Regarding oil, the EIA is begging people to listen to them; oil production from existing fields are declining 6% every year and we have huge problems in front of us. Nobody is listening to them.
– We don’t have new sources of energy that can come on stream fast enough.
– Supply and demand are out of balance and that is creating the commodity bull market. But all of the money printing is pouring gasoline on the fire.
– The world has a staggering agriculture problem as well. There has been little investment for 30 years in agriculture, neither money or people.
– Expects that politicians will blame the commodity rise on speculators and will tighten regulations and make things even worse.
– Owns US dollars just as a contrarian investment and a trade; long term he is bearish on the dollar.
– If he was paid in US dollars he would move to Asia and get paid in hard currencies.
Here is the video: