Investment guru Jim Rogers says the United States risks hyperinflation, thanks to the government’s massive fiscal and monetary stimulus.
That stimulus also will continue to hurt the dollar, he told CNBC.
"There's no question the U.S. is vulnerable to hyperinflation down the road or certainly the inflation we saw in the 1970s, I would expect that to come back in the foreseeable future, certainly in the next few years," he said.
Consumer price inflation peaked at 13.3 percent in 1979, according to government data.
Rogers says current government figures, which show consumer prices fell 1.5 percent in the year through August, understate inflation.
"The true inflation rate in America? It's certainly at least 6 or 7 percent,” Rogers says.
“The U.S. government lies about it, as you know. Everybody who shops knows that prices are up.”
As for the dollar, easy Fed monetary policy is a major problem, he says.
“America is debasing its currency at a terribly rapid rate. . . It is helping in the short term. But longer-term, I’m extremely pessimistic and worried about the fate of the U.S. dollar, because those people in Washington are doing their best to debase it.”
While inflation stands as the crucial long-term issue, bond giant Pimco’s Bill Gross says deflation still represents the short-term concern.
“There has been significant flattening on the long end of the (yield) curve,” he told Bloomberg.
“This reflects the re-emergence of deflationary fears.”
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