Last year we covered a number of big name investors’ warnings regarding the future of financial markets. Many had quite a stark view including George Soros’ Quantum Fund co-founder, Jim Rogers.This past May, Rogers had such a dismal outlook that he warned “A $68 trillion ‘Biblical’ collapse is poised to wipe out millions of Americans.”
Since then, the Dow has hit record highs above 20,000 and many other fragile bubbles continue to expand.
And just this week, Jim did a podcast interview with Erik Townsend and Patrick Ceresna on their show called “Macro Voices” in which he was questioned on a variety of topics. He didn’t contradict any of his previous statements, though he certainly had opportunities to do so.
Most notably, Rogers offered another warning statement; “Get prepared,” he went on “because we’re going to have the worst economic problems in your lifetime and a lot of people are going to disappear.”
Jim went on to reference the demise of both Bear Stearns and Lehman Brothers which were around for 90 years and over 150 years years respectively. Both despite surviving two World Wars, still disappeared overnight while days before, Jim Cramer, on CNBC, admonished that Bear Stearns was a buy at $62… six days later it was bought out by JP Morgan for $2 a share.
And Rogers thinks it’s possible that many companies and even countries may soon no longer exist, just as Bear Stearns and Lehman Brothers disappeared.
Trumps seems to have an inclination to start trade wars with China and Mexico among other countries. Members of Trumps cabinet also are willing to comply with Trump’s desire for war. A war would be a most destructive event at this point in time, but it is certainly a possibility as Rogers indicated.
Rogers is bullish on the US dollar in the short term, but he points out the dollar’s potential upside is not based on fundamentals, but rather on investors not knowing where else to place their funds. He mentions how despite many investor’s perception that the dollar is a safe haven, it no longer is and that will come back to hurt a lot of people.
If the US dollar bubble continues to inflate over the short term the way Rogers expects, he anticipates that a number of countries and companies that are overextended in US dollars will go bankrupt as the dollar climbs higher and they’re no longer able to service their debt.
And he is certainly putting his money where his mouth is by encouraging people to buy gold on the dips. In fact, this is a move that is reminiscent of Stanley Druckenmiller’s decision to enter back into his gold position.
He was very clear in this particular interview that he wants to own more gold and silver. He wants to buy it at a lower price and expects short term corrections which will allow him to do so.
If you recall, Rogers has been a strong proponent of physical gold ownership for awhile. He reaffirmed his admiration for the metal back in his 2016 interview with Barron’s where he told them;
“… if Trump does what he says he’s going to do such as wage trade wars then it’s going to be bad news for all of us. Trade wars have led to bankruptcy and bankruptcy has often led to war. At that point, you’d better own a lot of gold.”
In light of Donald Trump’s rhetoric of late, we completely agree with him. We’re long gold and precious metals as well as bitcoin which we still think is a massive buy.