Jim Rogers: Coming Recession ‘One Of The Worst’

Posted In: British Pound, Commodities, Crash Prophets, Currencies, Dollar, Economy, Financial Sector, Homebuilders, Inflation, Investment Banks, Recession, U.S. Government, UK

Commodities investor Jim Rogers told Bloomberg yesterday that the U.S. economy is heading for a recession that may be the worst “in a while,” and investors should sell the dollar as global currencies weaken. The chairman of New York-based Rogers Holdings said from Singapore that:

It’s going to be one of the worst recessions we’ve had in a while because we had so many excesses going into it… It’s going to be bad for all of us as currencies come under more and more stress and we have more inflation in the world.

In addition to sharing his views on a possible recession, the legendary investor said that the governments of the United States and United Kingdom have been “lying” about inflation. Rogers noted that he’s sold both the dollar and the pound, and said:

I hope by the end of this year all of my assets will be out of the U.S. dollar… The dollar is a currency that’s terribly flawed and it’s going to be under duress for many years to come.

The co-founder of the Quantum Fund with billionaire George Soros in the 1970s re-iterated his belief that the commodities bull still has a ways to run, despite the weakness of the greenback. Speaking to Reuters by telephone from his home in Singapore last Thursday, Rogers said:

I sound like a broken record, but it ain’t over yet. It’s got a long way to go… It’s come a ways, but we may be in the fourth inning of a nine-inning ball game, to speak in U.S. baseball terms.

Commodities prices are going to go up no matter what happens to the U.S. dollar, even if it rises, because there are serious supply/demand shortages which have developed over the past 25 to 30 years.

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Commodities: still swinging away

In addition, the American investor noted:

I am still short the investment banks in America, and these are the guys (Federal Reserve Chairman) Bernanke’s trying to save. I think that’s been the single area with the most excess — that and home-building.

Rogers recently moved to Singapore after selling his New York townhouse for $16 million on December 17, a gain of 150-fold from the price he paid for it, according to The Morning Call this past Sunday. The investor and author bought the property for $107,000 in 1977.

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