Tags: Jim | Rogers | Trade | Wars | Collapse | Economy | global

Jim Rogers: Trade Wars Will Collapse Economy

Wednesday, 20 Oct 2010 01:33 PM

Investment icon Jim Rogers says the trade wars looming on the economic horizon could spell disaster for the global economy.

"The word is on a very dangerous precipice, and if we do continue with trade wars, that's going to be the end of the world economy … we’ve seen many countries putting on capital controls already," Rogers, chairman of Rogers Holdings, told CNBC.

"If we don't solve this problem, it's finished, it’s all over.”

If governments print a lot of money, Rogers observes, the Dow Jones Industrial Average “could go to 50,000, and we could all be losing huge amounts of money because the money will be worthless.”

Rogers is skeptical that the U.S. economy is improving. “The central bank is making things worse,” he says. “The reason I don’t have a lot of shorts is that I’m afraid banks are going to print a lot of money and everything will go up.”

Rogers has begun shorting long U.S. Treasuries and most of his emerging markets holdings.

“There are probably 20,000 or 30,00 MBAs on airplanes flying around trying to find new emerging markets,” Rogers observes.

"That's not a game I want to play in October of 2010," he says.

Rogers believes that raising interest rates is “good anywhere in the world,” not just in China. However, China’s interest rate hike “attracts more money to China, which means there will just be more inflation in and if itself.”

“The Chinese have gotten themselves in a bit of a bind as long as they have a blocked currency,” he notes. “Whenever you have artificial controls, it works for a little while, but then it has unintended consequences (that are) not good for anybody.”

Despite their recent price drops, Rogers doesn’t like bank stocks, either, because the problems they have with mortgages will take a long time to solve.

What does he like now, then?

“I’m very optimistic about rice,” Rogers says. “I’m optimistic about agriculture worldwide.”

Bloomberg reports that the worst floods in four years in Thailand, the world’s biggest rice exporter, may cut production from the nation’s main crop by up to 20 percent, likely extending a rally in prices.

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Investment icon Jim Rogers says the trade wars looming on the economic horizon could spell disaster for the global economy. The word is on a very dangerous precipice, and if we do continue with trade wars, that's going to be the end of the world economy … we ve...
Jim,Rogers,Trade,Wars,Collapse,Economy,global
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2010-33-20
Wednesday, 20 Oct 2010 01:33 PM
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