Investor guru Jim Rogers says life on the farm will bring far more riches in coming years than the trenches of Wall Street.
Rogers, a commodities evangelist for more than a decade, has tweaked his pitch, saying the producers of the world — whether individuals, companies or countries — will become the new growth sector.
In short, Rogers told the Reuters 2011 Investment Outlook Summit in New York, being productive, saving the fruits of your labor, and owning hard assets hold the keys to a bright future.
"All these people who got MBAs made a mistake. The city of London and Wall Street are not going to be great places to be in the next two or three decades. It's going to be the people who produce real goods," he said.
"Throughout history we've had long periods when the financial centers were in charge. But we've also had long periods when people who produced real goods were in charge — the farmers and the miners," Rogers said.
Rogers, who rose to prominence after co-founding the now defunct Quantum Fund with billionaire investor George Soros some four decades ago, railed about the fiscal irresponsibility of debtor governments and praised China and other Asian countries because they save, work hard and invest in the roads, schools and factories that beget tangible wealth.
As an example, he said that commodity- and mineral-rich Canada will fare far better than Belgium, the seat of European bureaucracy.
Rogers still touts commodities, despite a recent price surge. Even with the benchmark Reuters-Jefferies CRB index .CRB of 19 commodities hitting its highest level on Tuesday since October 2008, Rogers said commodities will continue to soar over the next decade.
"They're very high, but they're going to be much, much higher over the next decade. Even I'm going to be stunned, and I'm the bull," he said.
Spot gold hit an all-time high at $1,430.95 an ounce on Tuesday, benchmark copper hit a record peak at $9,044 a ton in London and U.S. crude rose above $90 a barrel for the first time in 26 months, before all turned lower.
A year ago at the Reuters Investment Outlook Summit, Rogers said investors in oil, metals and grains should not sweat sell-offs in those markets because the printing of money by governments across the globe would push prices higher.
Rogers reiterated on Tuesday that politicians are afraid to bite the fiscal bullet and will opt to debase their country's currency. He called the Chinese renminbi the world's safest currency and again said gold would eventually rise above $2,000 an ounce.
A bubble might exist in housing in China's coastal cities, but he called it a price bubble and not harmful like the credit bubble that was behind the U.S. housing debacle.
"We had a credit bubble here, perhaps the biggest credit bubble in the whole world," he said. "That kind of huge credit bubble certainly is different than a price bubble. If people go bankrupt in China, it's not going to bring down the Chinese economy."
More currency crises loom, and creditor nations — China, South Korea, Japan, Thailand, Taiwan and Singapore — will thrive, he said.
Rogers singled out the United Kingdom as vulnerable to hard times, and said the pound would underperform the euro over the next five years.
The United States also faces difficulties.
"The way you build an economy, a thriving economy is you save and invest," he said. "Productive capacity is what leads to long-term growth of the economy. You don't build an economy by going to the disco every night."
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