Tags: Rogers | gold | europe | india

Jim Rogers: Gold May Plunge 40% to 50% on Fears of Europe, India

By Dan Weil   |  

Investment icon Jim Rogers thinks gold’s correction has a long way to go – perhaps as far as 40 percent to 50 percent from its peak, thanks to bearish trends in India and Europe.

That could send the metal as low as $957 an ounce from around $1,540 recently.

In India, "there's some movement to really curtail the purchase of gold,” Rogers tells Business Insider. “Some people in India say we should stop importing gold period, which would be draconian.”

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India accounts for 27 percent of global demand for gold jewelry and investment, according to the World Gold Council.

Boycotts, new taxes, and a drop in India's rupee have boosted gold prices there, stifling demand, The Wall Street Journal reports.

"There's an element in India in the last several months which is very strongly saying we've got all this money tied up in gold which is not good for the economy,” Rogers says.

To India’s west, “There are Europeans who are talking about the need to sell their gold or at least to start offering gold backed-convertible bonds,” Rogers says.

To be sure, given that gold has seen only one significant pullback in 11 years, a correction would be healthy, he says.

Many think Rogers will get his wish. "The weakness of the rupee . . . is likely to act as a drag on demand in the world's biggest market," Jeffrey Rhodes, head of precious metals at INTL Commodities DMCC, tells The Journal.

Editor's Note: Obama Donor Banned This Video But You Can Watch it Here




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