Jim Rogers 01 (May 08 - May 10)

[winston]

The Best Thing Jim Rogers Ever Said By Brian Hunt, Stansberry Research

"I just wait until there is money lying in the corner, and all I have to do is go over there and pick it up. I do nothing in the meantime."

Of all the brilliant things Jim Rogers has ever said, I believe this one is head-and-shoulders above the rest.

Rogers is one of the most successful money managers in history. He made so much money investing and trading during the 1970s, he left the conventional side of work to travel and run his own money. You can read more about him in the greatest trading book ever, Market Wizards.

In that short quote above, Rogers nails one of the most important factors to trading and investment success: Don't spend your time and energy chasing mediocre trades and investment opportunities. Only move when the odds are overwhelmingly in your favor.

If you follow his lead, you'll probably end up a very successful trader. If you don't, you'll contribute to the bank accounts of those who do follow his lead.

You see, the average market participant always feels like he has to be "doing something." He chases all kinds of ideas... takes lots of "fliers"... acts on all kinds of magazine articles, CNBC shows, and hot tips from buddies. He's always on his phone or computer checking quotes. He usually has a bunch of stocks in his portfolio that are down big... but are sure to "come back."

Not Jim Rogers.

In all his books, interviews, and articles, Rogers makes it clear he spends long stretches of time without having significant money at work in the market. He waits for extraordinary opportunities, where the odds are so far in his favor, the position is like picking up free money. When he doesn't see any sure things, he simply sits in cash and does nothing.

Now, don't get me wrong. There are few 100% can't-lose trades and investments in this world. I'm not encouraging you to find trades that carry no risk of loss. I'm encouraging you to find trades where the odds are heavily stacked in your favor.

Find the sorts of "extreme" opportunities I've written about before... where the sentiment toward an asset is shifted to one side... where the valuation is ridiculously expensive or ridiculously cheap... and where the market is moving in the right direction and confirming your thesis. These are the opportunities where you can risk $1 and make $5 or $10.

Only then should you commit a large chunk of capital to an idea.

If you're not seeing any extremes, it's best to fight the natural urge to stay busy and make "this might-could-kinda-work" trades. These trades will just distract you, cause stress, and run up your commission bill.

Most older, rich investors and traders will tell you they made most of their money on five or 10 positions they had tremendous conviction in... where it felt like they were simply picking up free money. They'll tell you the other positions weren't worth the time it took to put them on.

To sum up: Be lazy in the market. Don't worry about sitting on a big pile of cash, waiting for low-risk, high-reward trades. It's the idea behind "free money" trading. It's the thinking that built and maintained Jim Rogers' wealth. It can do the same for you.

http://www.growthstockwire.com/archive/ ... sep_14.asp

[winston]

'We're going to have zombie capitalism for the next 15-20 years,' says Jim Rogers

Speaking to CNBC Wordwide Exchange today Rogers said "All the government officials and bureaucrats loved the fact Lehman failed, because they could all jump in and support banks."

"This whole problem was not caused by Lehman Brothers or Lehman Brothers failure. Lehman was an effect not a cause."

"The real problem over the past 10-15 years has been that regulators have not let people fail. Had they let people fail we would have solved this problem a long time ago. I don't know why they're not in jail," Rogers said.

Reiterating his view about US monetary policy and their effect on the Dollar, Rogers warned. "I would expect there to be a currency crisis or a semi-crisis this fall or next year. It's crony capitalism, Bernanke and Greenspan have brought crony capitalism to America … but that's not going to solve the world's problems."

"We're going to have zombie capitalism for the next 15-20 years. How long are you going to let the bureaucrats run the thing so we can't have a clean system?," he added.

"Banks have been going bankrupt for a few hundreds years. The way the system works is when somebody fails you let him fail. What we're doing now is we're taking the assets away from the competent people and giving them to incompetent people and telling them now you can compete with competent people with their money."

Addressing debt & consumption and how more of the same can solve the problem, a theme that has become classic Rogers rants, he said: "How can the solution for debt and consumption be more debt and more consumption? How can that be the solution to our problems?"

http://www.bi-me.com/main.php?id=40249& ... cg=4&mset=

[kennynah]

Addressing debt & consumption and how more of the same can solve the problem, a theme that has become classic Rogers rants, he said: "How can the solution for debt and consumption be more debt and more consumption? How can that be the solution to our problems?"

...and so....i would like to once hear some suggestions on possible solutions from this wise guy...

as i always say..when there's a problem...no point talking about problem without giving constructive suggestions on how to solve them... otherwise, it is no more than kau peh kau boo

[-dol-]

"Banks have been going bankrupt for a few hundreds years. The way the system works is when somebody fails you let him fail. What we're doing now is we're taking the assets away from the competent people and giving them to incompetent people and telling them now you can compete with competent people with their money."

Herein lies part of the "solution", I think - let the zombie banks fail.

[kennynah]

i read selectively.. hahahaha....

ok..so, when people mess up...send them to jail.... dangle the carrots but also wield the rotan...

just like saying...

perm sec of education to school principals : "if you overall school's results fall below XX benchmark, you will be fired"

as oppose to : "to achieve consistently good results, above XX benchmark, you as principals, must do the following : a) yadayada b) mumbomumbo c) 5cents10cents...etc"

i guess... when one is reknown...there's no need to get into the details... just broad brush with sweeping statements...and they will still acceptable as "suggestions on problem resolution"...hence, i call this man...a wise guy, indeed...

[winston]

I think that they should have let AIG and the other Investment banks failed. It will not be the end of the world. Why should tax-payers bail them out ?

Also, I'm starting to think that taxpayers money should also not be spent on so called "Stimulus Programs". Normally, these programs are used to bail out some vested interest / connected people, under the disguise that it's good for the economy.

If we want to stimulate the ecomomy then do what the Taiwanese do. Send Vouchers to every adult so that they have to spent those vouchers. This is fairer then allowing a certain industry / company benefit from the bail-out...

[winston]

Jim Rogers on the best commodities to buy right now

While Jim Rogers says that China is the only emerging market where he isn’t selling right now, he is no longer buying new Chinese shares, and says he is now only investing in China indirectly through commodities investment.

CIB spoke to Rogers about his opinion on the future of commodities, how a commodities boom would affect Chinese growth, and the effect the economic crisis is having on the future of the markets.

http://www.cibmagazine.com.cn/Features/ ... ogers.html

[winston]

Why Jim Rogers is not buying stocks now

Maverick investment guru Jim Rogers, who has a pessimistic view on the state of developed economies and what is being done to counter the recession, is not buying into equity and commodity markets at this stage. Rogers attributed the recent run-up in equity markets to the various stimuli packages released around the world.

On commodities, Rogers said he owned base metals and — among precious metals — gold but wouldn’t buy those at current levels, given the recent rally in commodities.

The long-term call on the dollar was that it would be “a disaster,” Rogers said, but added that he was positive on the Japanese yen.

Rogers, who last year shifted base from the US to Singapore, said he was long-term positive on Chinese equities. Among other emerging markets (EMs), Rogers said he wouldn’t buy anything in the Russian market, though Brazil, which was a natural resource-rich country, looked better managed now, while the Indian stock market looked expensive due to its recent rally.

“Most EMs have been very strong in the past year after the collapse or the fall of 2008, most EMs have gone up a lot. I don’t like to buy anything that has gone up a lot,” he said.

“I am very worried about the Western economy, I don’t think that the problems are solved in the West and if you start seeing more problems in the West, it is going to have an effect on most markets around the world as certainly some of the EMs.

http://www.moneycontrol.com/news/fii-vi ... 17240.html

[winston]

Jim Rogers: true inflation rate is at least 6% - 7%
From the S&A Digest:

Jim Rogers told CNBC inflation is already much worse than the government is reporting.. "There's no question the U.S. is vulnerable to hyperinflation down the road or certainly the inflation we saw in the 1970s. I would expect that to come back in the foreseeable future, certainly in the next few years," he said.

"The true inflation rate in America? It's certainly at least 6% or 7%. The U.S. government lies about it, as you know. Everybody who shops knows that prices are up, everybody except the U.S. government, and I wish we knew where they shopped so we can shop there too and get good prices."

Rogers said the Fed's money printing is destroying the dollar and he is "extremely worried" about the long-term prospects of the currency. He recommends buying Asia, but said he isn't currently buying anything due to the recent rally.

[winston]

Commodity Boom Will Thrive on Shortages, Rogers Says (Update3)
By Halia Pavliva and Sapna Maheshwari

Oct. 8 (Bloomberg) -- Commodity supplies will lag behind demand during the next 10 to 20 years, further fueling a rally in raw materials, according to investor Jim Rogers.

“I don’t see any adequate-supply situation in any commodity market over the next decade or two,” Rogers, the chairman of Singapore-based Rogers Holdings, said today in an interview in New York. “The commodities boom is not over and the bull market has several years to go.”

Gold will surpass its inflation-adjusted all-time high of more than $2,300 an ounce, Rogers said. He said that the timing will depend on many factors, including global politics. Some investors buy gold as a hedge against political instability and to preserve assets.

Favored Materials

Agricultural commodities are among his favorites, because demand for food, including grain and sugar, is rising in countries such as India and China. Rogers said cotton may gain as farmers produce less fiber in favor of growing biofuel crops such as corn.

“I own some cotton,” Rogers said. “I own some sugar,” he said. “Sugar will go much, much higher over the course of the bull market.”

“Oil could reach between $150 and $200 a barrel,” because known reserves of crude are declining, Rogers said. He said international relations, particularly between the U.S. and Iran, will help guide prices.

“Natural gas is very cheap,” he said in the interview between sessions at an ETF Securities Ltd. investor conference.

Commodities ‘Best Place’

“Commodities are the best place to be, if you ask me, based on supply and demand,” Rogers said. He said he hasn’t invested in equities outside of China in two years.

“Everything has gone through the roof,” Rogers said of equities prices, adding that he may consider buying stocks “if something collapses.”

Falling supplies make commodities a better investment than equities, including shares of commodity-linked companies, Rogers said. He said oil would be better to own than petroleum companies, for example, because some suppliers could face “depleting reserves” as the world eventually drains known fields. Rogers said “unless something happens,” the world will exhaust crude reserves in 15 to 20 years.

“The supply of everything continues to decline,” Rogers said. “If the world economy recovers, commodities will do the best, because supply is being restricted. If the world economy does not recover, commodities will still be the best place to be, because governments are printing huge amounts of money.”

As a long-term investor, “I am horribly pessimistic about the dollar,” Rogers said. “I am not selling it yet. I think there may be a rally. I don’t think it will be sustainable if there is one.”

http://www.bloomberg.com/apps/news?pid= ... YHzYh0dzCY