Tags: Rogers | gold | correction | continue

Jim Rogers: Gold’s Correction Will Continue

By Dan Weil   |   Friday, 26 Oct 2012 09:09 AM

The 11 percent correction that gold has endured since hitting a record high of $1,924 an ounce in September 2011 will last for a while, says renowned investor Jim Rogers.

That’s simply because of the law of gravity as it applies to financial assets, he tells Business Insider. Spot gold traded at $1,712 late Thursday.

“Gold is up 12 years in a row. That’s extremely unusual,” Rogers says. “I don’t know any asset in history that has gone up 12 years without a down year, though there may be some.”

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Moreover, speculators have been buying a lot of gold in the past few weeks. “That’s always a dangerous sign,” Rogers says.

“When speculators are going long in a big way, whatever the asset is, it’s going down. … So I would expect gold’s consolidation to continue.”

To be sure, Rogers isn’t selling any of the gold he owns. Like many others, Rogers sees the Federal Reserve’s quantitative easing as supportive for the precious metal.

“It hasn’t done much good for the world, certainly not for American manufacturing production or for employment numbers,” he says. But the four-year easing program “has helped gold prices.”

Whatever happens in the very short term, Peter Schiff, CEO of Euro Pacific Capital, says gold will soon enjoy a huge surge, hitting $5,000 within two years.

“I think gold is going to go up against all currencies,” he tells CNBC. “Central banks around the world are being too loose.”

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The 11 percent correction that gold has endured since hitting a record high of $1,924 an ounce in September 2011 will last for a while, says renowned investor Jim Rogers.
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