Tags: Jim | Rogers | British | Pounds

Rogers: I'll Never Own British Pounds in My Lifetime

Thursday, 25 Mar 2010 09:46 AM

Investor Jim Rogers, chairman of Singapore-based Rogers Holdings who co-founded the Quantum Fund with George Soros, said he won’t buy British pound sterling because of the United Kingdom's trade deficit.

“Things are pretty bad for sterling for the long, long, long term,” Rogers told Bloomberg. “I cannot imagine buying sterling back unless it gets really cheap.”

“I doubt I will own sterling in my lifetime.”

Rogers is the latest well-known investor to eschew the British currency after the pound’s worst annual start in 13 years. Bets on the pound weakening against the dollar now outnumber bets on pound strengthening eight times.

That’s more than when Soros made $1 billion betting against the pound in 1992.

Hedge funds and large speculators had 67,549 more bets the pound would decline against the dollar than contracts that profit from an increase as of March 2, data from the Commodity Futures Trading Commission in Washington show.

The U.K. trade deficit unexpectedly rose in January to the widest in 17 months, reaching 8 billion pounds ($12 billion).

Given all the focus on the euro’s struggles, most investors do not realize so far in 2010 British pound ETFs have lost more ground than euro ETFs, says ETFdb financial blogger Eric Dutram.

The CurrencyShares British Pound Trust is down 6.7% year-to-date, compared to a loss of 5.6% for the CurrencyShares Euro Trust.

This sharp downturn in the pound comes as Britain finds itself in the worst fiscal situation since World War II. Some estimates put the current UK budget deficit at roughly 12.7 percent, on par with Greece.

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Investor Jim Rogers, chairman of Singapore-based Rogers Holdings who co-founded the Quantum Fund with George Soros, said he won t buy British pound sterling because of the United Kingdom's trade deficit. Things are pretty bad for sterling for the long, long, long term, ...
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