3 Minute Gold News
A Quick Read for Busy People
A 3 minute synopsis of two interviews with Jim Rogers, chairman of Rogers Holdings and author of Street Smarts: Adventures on the Road and in the Markets, by Daniela Cambone of Kitco News from July 13, 2013, and Greg Hunter of USA Watchdog on August 25, 2013.
With the recent drop in the spot price of gold, I thought I’d re-listen to Jim Rogers from 2013, talking about how this is what he thought would be going on right now.
Music moves in cycles-per-second and markets move in cycles-per-century.
Interview July 13, 2013
Jim doesn’t pay much attention to the Federal Reserve (FED).
He says the FED only knows one thing and that’s to print money. It’s the wrong thing to do. Short term traders have to pay attention to the FED, but he’s not a short term trader.
Gold will hit a complicated bottom. What this means is that it’s probably going to fluctuate with rallies for another year or two, and then make its final bottom (That would mean 2014 – 2015).
The anomaly with gold is that it went up for twelve years in a row. Jim doesn’t know anything that has gone up twelve years in a row.
The bottom, whenever and where ever that is, will be unusual too.
It will take a year or two to make a bottom, (that would mean 2014 or 2015), just because it took so long to reach a top.
If gold goes down 50% from its top then it will reach a bottom of between $900 -$1,000. It could go to $900 as part of the bottom process that he’s talking about, but he’s not saying that it will go to $900 as its bottom.
A 50% correction is not unusual in markets. What is unusual about gold is that it went up twelve years in a row.
That is very strange.
What helped make it go up was the twenty year bear market.
It made its peak in 1980, then collapsed and bottomed along until 1999-2000, before it started going up again.
Also, the absurd policy of money printing, deficit spending and wars helped make it go up.
All those things came together, and what’s making gold go down now is that countries are making it harder to buy gold.
In India’s case they have a large balance of trade deficit. In France and Germany, they want to get as much as they can from citizens and gold is an easy way to do it.
Mines can work below the cost of production for some time because its expensive to close a mine, and very expensive to re-open a mine.
Jim felt the same way about silver, copper and the other precious metals when he held this interview — he believes they will bottom along with gold.
He will buy again when it’s at its bottom, and was not selling his gold by any stretch of the imagination.
Interview August 25, 2013
This is the first time in recorded history that all major Central Banks are printing money at the same time because they are trying to debase their currencies.
Japan, Europe, America, the U.K. — everyone is doing it.
In the 1930s everyone had “beggar they neighbour” policies and raised taxes.
We’ve had massive debasement of currencies (by money printing) and it’s going to end very badly no matter what they say.
There’s a massive amount of money going somewhere. It’s going into financial markets for the most part.
What little recovery there has been is artificial on an artificial sea of liquidity.
When the sea of liquidity stops, the people who have been getting the money first of all are going to suffer because that money is gone. That means then the rest of us are going to suffer.
Financial markets are going to go down. Currency markets are going to be in great turmoil.
The solution to a problem with debt is not more debt.
In the past when you have debasement you have serious inflation, but you also have bubbles in some parts of the economy.
The minute you have inflation you have interest rates going up, and you start having currency turmoil.
It’s all a mess because printing money is artificial.
It’s never worked.
Many corporate, city and state pension plans are under water.
We’ve been living in a world of unreality for at least fifty years in the United States – kicking the can down the road – hoping it will be solved, or at least it wouldn’t be their problem, and it would be the next generation’s problem.
Finally, all of this is coming home to roost.
We’ve had recessions every 4 – 6 years since the beginning of the republic.
We’re going to have another one, and it will be worse because the debt has been going higher and higher, and the artificial printing of money has been just massive.
It is the law in America and Europe that governments can “bail in”. They can just take your money, whatever is over the amount that is insured.
Of course that’s coming.
Politicians are paid by the lobbyist and so they’re going to do what the lobbyists tell them.
In 2008, Ben Bernanke bailed out his Wall St. friends who called him up. No plumbers called him up – it was his friends and he bailed them out.
They’re going to take 401Ks and deposits above the insured amounts – both.
When the economy slows down then taxes slow down, there are great screams to spend more money, and politicians react to those screams. They need money. They try to borrow money. It becomes harder and harder to borrow money because people are catching on. So they’re going to take money where ever they can.
When a big bank gets into trouble they will decide to take the money from the depositors. They warned everyone that they changed the law.
They will say that all you innocent Americans have been doing badly in your 401Ks, so they’re going to protect you by giving you a 30 year government bond with a guaranteed interest rate — they’ll take your money.
Politicians come up with all kinds of ideas. In the 30s they took our gold.
They probably won’t take our gold this time because it’s not crucial to the world’s system like it was then.
So they’ll take our bank accounts and retirement accounts.
Everyone should make their own decisions and shouldn’t listen to some guy on the internet, including him.
Jim says he owns gold and silver and believes there will be another chance to buy both. He tries to keep his bank accounts below the amount insured.
We’ve had perilous times before.
No one has solved the problems and the debt is going higher.
There should be some real fear of economic trouble. First, people are oblivious to a problem, then they deny there’s a problem and want it to go away. Eventually they start to act.
It’s coming. Be worried. Be careful.
Jim Rogers watches long term cycles. He’s a legendary investor who moved his family from New York to Singapore in 2001, so his younger daughters could grow up learning Mandarin.
He says not to listen to him or to anyone. Do your own research and invest in something you know.
He was my first economic guru. When he is kind enough to share his opinion in interviews I like to listen to what he says.
Here’s a synopsis of two interviews Jim did in 2013 talking about gold.
Another Week on Wall Street
words and music Elaine Diane Taylor
© 2013 Intelligentsia Media Inc. All rights reserved.
from the album Coins and Crowns available on iTunes
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