Tuesday, September 27, 2011

The only sector commodity bull Jim Rogers would buy right now

Jim Rogers is a long-term bull on commodities based on scarcity in a growing world.
Silver and gold "will both go much higher over the next few years," he tells Economic Times. Oil prices will recover as "known quantities of crude continue to decline." Sugar is going to "at least double or triple before this all is over."
But there's only one sector he would buy right now:
I am thinking about buying agriculture right now. I am not thinking about buying base metals or gold or oil right now, but I am thinking of buying agriculture maybe this afternoon. That's where demand will come first. Probably precious metals second, then the rest of the commodities.
Agriculture is facing some very serious problems whether the world economy slows or not because we have shortages of everything. The inventories are very low. We even have shortages of farmers developing in many countries. The average age of farmers in America is 58, likewise Australia. In Japan, it is 66. You have hundreds of thousands of Indian farmers committing suicide. It has been such a terrible business. Higher suicide rate of any profession in the UK is in agriculture.
So farming has got serious problems facing it. We are going to see much much higher prices over the next decade. So I would buy agriculture soon. The others, I am more watching the world economy and the world markets before I step in.

Jim Rogers: Is World Currency War Causing Global Market Meltdown?

Some quotes:
“The U.S. dollar is not a safe haven, if you ask me, but I do own it.”

“Agriculture prices [are] getting banged right now. I am kind of planning on buying Swiss francs, more dollars and agriculture.”

On China “They’re doing their best to cool things off … I expect them to continue to do it, and that is causing more slowdown around the world.”

“The major problems are coming from the west," “They are coming from Europe and the [United States]. We are much worse off than we were in 2008 because the debt has gone through the roof.”

“At least in 2008 there was the possibility that the governments could bail us out. Now, of course, the governments have gotten deep, deep, deep into debt themselves,” “Everybody is in much worse shape.”

Brazil sort of ignited a trade war [by putting a 30 percent import tariff on China and Korea ]. And right now China is trying to get the Europeans to let them open up the trade with China more. The Europeans are saying no, so China is saying, 'No, we won’t bail you out.'"

“I hope the trade war doesn’t break out" because throughout history when it does it has "caused depressions,” Jim Rogers added. “You saw what happened in the 1930s. It led to depression and it also led to war. So I hope it can be contained.”

Jim Rogers attacked Ben Bernanke stating, "is killing the people who save and invest, and that's really hurting a very, very large part of the population."