If it's a mystery, then why not educate yourself? Read some works by respected economists. Go back through newspaper archives and economic journals and study every recession and depression from the last 100 years. Why did Sweden recover from the Great Depression far quicker than the US? Why did the Asia meltdown of 1997-98 not turn into a depression? Why did Brazil recover from its meltdown in 2001-02 far better than Argentina? Why did America recover so quickly from the 1907 banking crisis, and not the 1929 crash? Why did the bursting of the 2000 bubble result in a mild 2 quarter recession rather than another depression? Do some homework and you will get your answers. There is a consistent pattern of quicker recoveries occuring when a recession is left to occur without heavy government intervention, versus depressions resulting when the government tries as hard as possible to stave off recession. The US Hoover and FDR administrations, and the Japan government in the 1990s, both had amongst the most heavily interventionist policies in the face of recession - they both had huge and lasting depressions. Some of the quickest recoveries from recession came when a reasonably laissez-faire approach was followed, such as Sweden in the 1930s, Germany post WWII, Brazil 2003 onwards (especially compared to Argentina's much more interventionist response) etc. It is a pretty strong and convincing body of evidence. Theory too provides compelling reasons to think that a relatively hands-off approach, allowing a recession to deflate overpriced assets and speculative excess, results in a quicker adjustment and subsequent recovery. When centuries of theory and practise both say the same thing, that is pretty compelling evidence. Recessions cause markets to clear. Cleared markets allow new investment at equilibrium prices, which creates economic growth and value-added activity based on reasonably efficient, rational risk premia. Recovery then occurs. It happens the same every time markets are left broadly to their own devices. Yet each time, ignorant people think an economy can't possibly recover by itself. There is nothing wrong with being ignorant about economics. There is a lot wrong with being ignorant about economics, and then offering strong opinions on the subject, such as that notion that economies cannot recover from recession without government internvention. People should learn to hold their tongue when the discussion moves to subjects about which they know little. I would not butt in on a discussion about neurosurgery to lecture people on the right way to conduct an operation. Yet lots of people with little or no training, education, or qualifications in economics seem to think they have the right to hold forth on the subject. This is a dangerous combination of ignorance and arrogance. If you don't have the desire or time to educate yourself on economic matters, leave the discussion to those who do.
Oh really? So when the Euro corrected from 1.36 to 1.15, you took it in your stride and bought more? When oil went from $77 to under $50, you were unfazed and remained a long-term bull, adding to your position at lower prices? How many people were bullish on commodities in 1998, 1999, 2000, 2001? How many wanted to buy gold when the central banks were pressing down the price back then, or in 2003 when gold fell 25% in 6 weeks after the Iraq invasion? Not a single talking head on CNBC was advocating the bull position consistently during those periods, except Jim Rogers. How many then got cautious on the metals in 2006/07, and advocated switching to agriculturals and soft commodities instead, just before the record move in those markets? Who called the Nikkei a buy in 2003 and then said stop buying when it was trading at 17000? Who called China long before the 450% rally in the last 2-3 years? You were certainly not doing so on ET. You are trying to make out that it was a simple matter of spotting a clear trend, ignoring the choppy environment in the early years of the commodity run, and ignoring the several sharp and long-lasting corrections that occured along the way. The notion that every trader and his dog has been long commodities all the way, and short dollar all the way, is nonsense. Regarding whether he backs his trades with real money etc, or is just a talking head - obviously I have no idea about his personal account performance. But since he is not trying to raise funds, that is not a big issue. What is an issue, is how good his calls are. Like EVERY trader, and EVERY person who makes calls, he gets some calls wrong. For example he was wrongly bearish on Russia, he was bearish way too soon on US gogo stocks in the late 1990s (although eventually right), he was wrongly bearish on the dollar in the late 1990s. However, what matters most is how much the winning calls make versus how much the losing calls make, and what the ratio of correct to losing calls is. On that front, Rogers is clearly good with his calls. The winners are numerous and many go up double, triple or more. The losers are less frequent, and lose a lot less than the winners. As for his real money record - again, to criticise this is ridiculous. As part of his partnership with Soros in the 1970s, they made 40% per annum during a flat stockmarket for 1 decade. Soros had high praise for him as a source of investment ideas, saying he did the work of 6 normal analysts, and generated many excellent winning stock picks both long and short. He made tens of millions in the stockmarket during the tricky 1970s environment, and the Quantum fund record when Rogers was there was superior to its record during any equally long period since then (i.e. Soros + Rogers did better than Soros alone, better than Soros + Druckenmiller). That is an amazing record with real money, the guy was worth >$20 million in his late 30s. The reason he appears in the media, rather than keeping quiet and running a fund, is because he *retired*. He decided to enjoy life and just invest his own dough and share his investment ideas rather than spend another 25 years making rich people richer and then blowing it on ineffective political lobbying (Jones, Dennis) or buying absurdly overpriced pieces of trendy but ridiculous art (Cohen), or being caught maximum long during two consecutive market bubbles (Druckenmiller, Soros in Russia 98 and tech stocks 2000). I'd say Rogers made the better decision by far. He travelled the world twice, married a woman half his age, is in the Guinness Book of Records, and is one of the few people in the media who provides informative (not perfect, but better than 95%) commentary on the markets. For all his flaws and somewhat anti-US bias/prejudice, Rogers is a more interesting, smart, and informative guy than 99% of people out there in the financial world.
Cutten, Thats a great reply to all the previous posts in this thread. Balanced and not ignorant. I really like Jim Rogers, and what I know about him, but I dont know that much about him until the last few months. He is an eccentric and if I made his fortune at that age I would do what he is doing. He makes perfect economic sense. He understands things in historical context. He isnt a spring chicken. As Marc Faber said, none of the new Wall Street gang have experienced a bear market before. They have their own self interests in saying the markets will recover soon, that self interest being the maseratis',lol....
so he has an interest in the markets and he's honest about his level of investing activity. doesn't mean he can't contribute...
I haven't watched CNBC in years and therefore haven't heard Maria in a long time. She is still as shallow as ever. What a waste listening to her is. RAH! RAH! The market is up; all is well! I guess she'll stay w/CNBC since I doubt any credible service such as Bloomberg would have her on as a financial expert.
I put this photo montage together in honour of Jim.... http://img247.imageshack.us/img247/8669/benhj0.jpg
Wow, are you related to the guy at all? Looks like I struck a nerve. I continue to maintain that he does NOT trade. It's easy to make all sorts of "predictions" ( and maintain your sanity through ALL of the "chop" that you point out ) especially when you don't have your OWN capital riding on it. If he was in fact managing money, it would give him a helluva lot more credibility in my opinion. And as expressed by several others on this thread ( like Pabst ), I'm not the only one that has this opinion of Rogers. That's just my opinion, so I guess at this point we can just agree to "disagree".
Well, he has said repeatedly that he has position X, Y, Z. Are you saying he is lying in the national press and television? Come on, don't play naive here - if you think the guy has been lying nationwide across the media for the last 25 years, then provide some evidence to back it up. That's just basic common sense. You don't accuse a man of outright lies like that without presenting some facts to support your case. It's a simple matter of fair play and common decency. I am not bothered if you disagree with me, but I am bothered when you accuse someone of basically being a fraudulent liar like that without a shred of apparent evidence.