Jim Rogers critique, in these tumultuous times, was put forward in his latest interview.
Jim Rogers did not mince his words when it came to expressing his dissatisfaction with central bankers
“They don’t know what they are doing, they are bureaucrats and academics,” he said. Indeed, we have gone from the temporary, transitory inflation narrative where the current core inflation of 5.7% remains almost triple the base case 2% inflation target.
“They don’t know what they are doing, they are bureaucrats and academics”
JIM ROGERS (comment, central bankers)
“There have been very few good central bankers in America’s history. I can think of maybe two,” said Jim Rogers.
Jim Rogers critique on the trajectory of rates is that they will not rise dramatically from here. “It will cost them their jobs and they know it,” he said.
In 1980 after a decade of inflation, interest rates on 90-day US treasury bills were 21%. “They had to do something to kill inflation and they did it. He doesn’t believe they will do it again.
Back then former US President Jimmy Carter supported the Fed Chair Volcker to do whatever he needed to get inflation down.
“It cost Jimmy Carter the election but he supported Volcker who took rates to 21%,” he said.
“Do you think these guys are going to take rates to 21%? Do you think they can count to 21%?
Of course not,” he added. But back then the US had a small debt and a sound economic energy policy and could afford higher interest rates.
“Do you think these guys are going to take rates to 21%? Do you think they can count to 21%? Of course not”
Low-cost energy entering the market helped to push inflation lower, which is a dynamic we do not have today. Green energy and fighting inflation are counterproductive policies.
The crux of Jim Rogers critique on inflation centers on the ballooning debt.
“In the 1970s, the US was the largest creditor nation today it is the largest debtor nation in the history of the world,” he said.
“We have inflation now because we have more money printing,” he added
Jim Rogers is not optimistic that they beat inflation. He believes the current reserve currency, the US dollar, should be neutral, allowing people to use it without consequences.
“The British Empire became overextended, invading countries. In 1923 the UK was the wealthiest and most powerful country in the world. Fifty years later, they were bankrupt.” – Jim Rogers
Jim Rogers critique of the USD as a future reserve currency is not optimistic
No world currency has lasted more than 150 years.
“I am afraid that is coming to an end. We are the largest debtor country in the history of the world. We print a staggering amount of money to pay for troops in over 100 countries. Some would say we are over-extended,” he said.
“The British Empire became overextended, invading countries. In 1923 the UK was the wealthiest and most powerful country in the world.
Fifty years later, they were bankrupt. The IMF had to fly into Heathrow and bail them out.
Some people will tell you today that the US is technically bankrupt.
Financing US military bases around the world is high maintenance,” he said.
Jim Rogers critique on big armies, and endless wars
Since 1776 the country has been at war for all but 15 years. “Washington seems to like war. We haven’t won wars in a long time, but they still like it,” he said.
“When China, Russia, and Saudi trade oil outside the USD, we will watch our standard of living fall, like the British,” he said.
He likes silver and gold.
“If you are very pessimistic, examine why this is so, since usually it does not last,” he said.
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