debt: Debt is going through the roof & we will pay the price: Jim Rogers

You will be successful in life, if you do not follow the crowd, said the marquee investor.

What is your view of the world, how bad the damage is and how are you looking at a complete reboot?

In 2008, the world had a big problem because of too much debt. Since then, the debt has skyrocketed everywhere, even in India and China. Ten years ago China had virtually no debt. Now they have got a lot of debt. Everywhere does. The next time we have a problem and we are having it now, it is going to be the worst in my lifetime. It is a simple statement. The debt is much, much, much higher now. It has to be worse. We have these problems every few years. The next is going to be horrible.

Why the US markets are then reacting as if nothing has happened in the world? I looked at Nasdaq last night, it is in the green; how remarkable is that?
What do you mean nothing has happened? what are you talking about? The US is spending trillions with the T and printing trillions of dollars; what do you mean nothing happened? The Bank of Japan, the guy goes to work, turns on the printing presses, print as fast as he can. All over the world, all these central banks and governments are printing and spending and borrowing as much as they can. Of course, the market is going up.

Do you think given the way how markets have gone up both in India and internationally, there is a huge disconnect between the ground reality and the market levels?
Yes, of course, there is. But remember what I just said. Nearly every country in the world is printing and spending lots of money now and that money has to go somewhere. It is going into the markets and that is what has happened. They say the excess money goes into markets. Remember there is an election in the US in six months in November and all those guys want to get re-elected. They do not care about you and me and our kids. They care about November and getting re-elected. So, all sorts of good things will keep happening and the markets will be okay for a while. However, the debt is going through the roof everywhere, the money printing is everywhere and eventually, we are going to pay the price.

It is often said that you should never fight the Fed, would you apply this again?
All this money is going to go somewhere; the Federal Reserve in the US started it. Do not fight the Fed but eventually, we are going to pay the price.

When I spoke to you a couple of years ago, about 8-10 years ago, you said if you want to get rich you need to do one thing which is buying a silver spoon, stacking sugar in your pocket and starting eating rice. If somebody wants to make money in the post-Covid world, what is the secret recipe?
I own silver and I own gold. I stopped buying it for a while but have not sold. I have never sold any. In the summer of 2019, I started buying gold and silver again. Agriculture is still a disaster but it has probably got great opportunities. If you buy the commodities themselves it is hard to get rich in agriculture in India because the Indian government protects farmers. Oh! those poor farmers, they could be rich if the government would leave them alone. Agriculture, gold and silver, some parts of the world economy have been smashed, transportation, airlines, tourism, and anything to do with travel has been killed. I bought a shipping company in Russia last week, and a wine company in China last week. Some of these things have been really beaten down and probably even if the bear market hits again, they are probably not going to go down much I hope.

Are you fully invested in this market?
Fully invested? No, no. I am too lazy, much too lazy. I have bought some things and continue to buy. I own a lot of US dollars because when the turmoil gets bad again and it already is, people look for a safe haven. They think that US dollars are safe haven. It is not but they think it is for historic reasons compared to the euro and other things; so I own a whole lot of US dollars and it is going to get overpriced. I hope I am smart enough to sell them, it might turn into a bubble. I hope I am smart enough to sell it when that happens and put my money elsewhere, maybe in gold. Often when the dollar goes up a lot, gold and silver go down. Silver is much cheaper than gold right now on a historic basis. The ratio between gold and silver is the highest it has ever been in recorded history. So, silver certainly is not overpriced in 2020.

You have always said that in markets, the same thing keeps on repeating itself again and again; it is a cycle of fear and greed and you need to figure out which template is at play. What does the current medical crisis remind you of? When did we see the economy shrink like this before?
It may be at the beginning of the first world war, maybe in August of 1914. In Europe in 1914 everybody thought everything was okay and nobody expected a gigantic world war but no, it has been anything quite like this. The markets were overvalued. The US market has been going up for over 10 years, the longest in American history and it was sort of a bubble there, waiting to end. Everything was going straight up for a while because of all the money printing and the market was due for a correction or for something to happen and along came the virus, but something always comes along.

What makes Jim Rogers a successful investor, is he a contrarian that is why he makes money?
Well people say I am a contrarian but my way of looking at the world is to look at things that are cheap, where there is change. If something is cheap, obviously, it is being ignored and so people then say that he is a contrarian. He looks at things that are ignored. Well, of course, that is what I want to find — things that are cheap. I do not like to go and look at things that everybody else is buying. So, if you buy things that other people are ignoring, people call you a contrarian. I just call it looking for value.

Is it important to be a contrarian to be a successful investor?
Well it is important to think for yourself and to be independent and to be curious. I am trying to teach my daughters think for yourself, do not listen to other people, be curious and if everybody is saying the same thing you look the other way and that is very important, whether it is TV reporters, football players, life. That is the way you will be successful in life and anything if you do not follow the crowd.

We have always spoken to Jim Rogers about his market view but today I want to speak about Jim Rogers his life as an investor, as a trader. I am going to take the clock back and really clock back when you had no white hair, you were in a different country and you were investing differently. What convinced you when you were in your teens and your twenties that you wanted to be an investor and you wanted to be a trader?
I knew nothing about investing. I knew nothing about Wall Street and when I was 21, I happened to get a summer job on Wall Street. I did not know there was a difference in stocks and bonds. I thought they were all the same thing. I knew something bad had happened in 1929 and that is all I knew. But I got there and I fell in love because all my life I have been very interested and curious about what was happening in the world and here was a place that would pay me to know what was happening in the world and pay me a lot if I did it right. So I fell in love. I thought I was going to go to law school and medical school and business school until I got this summer job. I did not go to business school. I did not go to law school. I did not go to medical school. I went to Wall Street.

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