Jim Rogers Interview on ET NOW
September 27, 2011 2 Comments
Here’s the transcript of Jim Roger’s interview on ET NOW as published in today’s ET:
Gold prices are overdue for a correction and it will last for several months, says Jim Rogers, chairman, Rogers Holdings. In an interview to ET NOW , the commodities investor speaks on his outlook on commodities and rupee.
Gold is down 10% in the past week and the CME increased margins by 21%. What is your outlook for gold prices? Do you see gold to $2,000 in the near term and medium term?
Gold has been up 10 years in a row, which is unusual in any asset class. So, if it’s up this year, it will be eleven years in a row. Gold is overdue for a correction, and it could have a substantial correction, given that it’s been so strong. I have no idea what’s going to happen this year. I doubt if it will go to $2,000 an ounce in 2011. It’s more likely to have a correction, which will last for several weeks, several months. It’s been very strong. If it goes down some more, I would buy more gold.
Silver’s been one of your favourites and is down 24% in the past week. Are you buying?
If silver continues to go down, I will buy more silver too. Don’t sell your silver, don’t sell your gold, unless you are a short-term trader.
Copper is down 30% this month? Do you see more downside in base metals?
I would expect most things to continue to correct, because the world’s got serious problems facing it in the future. Base metals will be affected by reduced demand, other commodities will continue to do well. You know what’s happening in Europe, you know what’s happening in America. Be careful. I am not selling any of my commodities, but I am not jumping in to buy either.
Crude oil prices have been down 10% in the previous week. Does the current price display a fair price? Also, what’s your view on global demand-supply of crude?
Known reserves of crude continue to decline. We have serious problems facing us with crude oil. The surprise would be how high the price stays and how high it goes eventually. I mean if UK suddenly goes bankrupt, there is some big shock to the system, of course, everything is going to go down for a while. That seems to be what’s happening, right now. But when they go down you should prepare yourself to buy more.
Did you expect such a sharp fall in commodities?
Given that stock markets around the world are collapsing, it’s not such a big surprise. I certainly did not expect it to be this hard, this fast with commodities coming down. Absolutely not.
Your call on the Indian rupee which has fallen to the lowest levels of the past two years?
I think what’s really happening is that there’s a flight into the US dollar. The US dollar is not a ‘safe haven’, I assure you. The dollar has terrible problems and it’s a very flawed currency. But in panic, people are rushing into dollars, because they don’t know what else to do. And that’s going to continue to make the rupee and other currencies weak at least for a while. There should be a rally in the rupee soon. But as long as people are terrified, they are going to run into places like Swiss franc, yen or the US dollar. So be prepared for a weak rupee for a while.
Now let’s watch and see what happens.Jim has been good at spotting opportunities but as he admits not great at timing.Also some analysts are talking about 21,000-22,000 levels for gold http://economictimes.indiatimes.com/markets/commodities/gold-rate-analysts-expect-the-yellow-metal-silver-prices-to-dip-further/articleshow/10136482.cms .So lets wait and see what happens.