http://www.bloomberg.com/avp/avp.ht...//media2.bloomberg.com/cache/vKShqTujr0EU.asf By the way, can anyone explain what are the implications of his last words "supply is going down faster than demand", is it inflation, necessarily?
No. It is merely higher prices. Inflation is a broader function of the total amount of money moving around in the system. And that will multiply * the supply/demand dynamic as well. I laugh at 'in the coming days, weeks, months.. i am selling my USD'.... So is it days, weeks, or months when he had his opportunity to sell at 1.25 to the euro when he was trumpeting the same thing? I don't know about that 'supply going down faster than demand' argument. Because in the past few months, demand has plummeted way faster than supply has. Maybe he might be more accurate in saying what he really means 'I postulate from here supply will go down faster than demand.' I must also add that many commodities shares are -definitely- impaired considering debt loads, collapsed revenues vs sticky to fall operating expenses, etc. Same general argument goes for the current state of many global shares in all sectors. I wouldn't be surprised if we are talking about a few hundred grand here.
Hi Scriabinop23 Right on. Excellent anaylysis and commentary. How can the global (Chineese or Taiwan) or commodity stocks Rogers recommends qualify as a good buy when faced with the current conditions you pointed out. Also getting out of one currency (US $) into another fiat currency doesn't achieve the goal of long term capital purchasing power preservation. Because you then become a trader, always searching and anticipating, but not necessarily preserving. Can you give any specific recommendations as to where one would invest to preserve capital purchasing power over the long term when faced with the massive global monetary inflation? It obviously needs to be directed into something other than $ in the bank. But where and into what? That is the question. I would like to hear more from you. Much appreciated. Thank you.
Gold. The only currency that is not someone else's liability. It's becoming increasingly obvious that gold has outperformed most (possibly all) commodities over the past 12 months. Despite many commodities declining against the US Dollar over the past 12 months, Kitco.com tells me that gold has appreciated by 7% against the US Dollar
agreed. gold and silver are good. But I must say that I actually think long term taking his positions are probably a pretty good idea. I just don't like his vagueness and attitude about these things. He seems to bend what he says not giving direct answers to when with his condescending attitude, which comes off pretty phony to me. We just had a market crash this year, and yes possibly may go lower, but I can tell you the signal gold is sending is not negative for stocks. If they had truly let the deflation cat out of the bag, there would be no money to keep gold so elevated. Maybe I am reading it incorrectly, but with gold near all time highs in euros and other currencies, it tells me the system is awash in money, and I know most people out there do *not* own it, so there is potential to go hell of a lot higher. I think the *bulk* of the worst is past. Sure unemployment will climb another 2-3%, but do you guys realize how money being printed will go to keep assets elevated? We're not talking about wealth creation until we actually make a fundamental discovery or innovation technologically - we're just talking about growth in nominal terms. The way I see it anyone in cash right now must have balls of steel, assuming that somehow the monetary forces being unleashed will not affect them. And to the answer 'it didn't work in Japan,' I counter it did work, just that they did not do it aggressively enough and put the brakes on too early when it did show results. Besides, Japan being an export nation is still subject to the whims of our wealth. One can't forget that. The US has a long tradition of being aggressive to avoid downturns and being too late to stop bubbles. We aren't exactly a haven of fiscal discipline. It isn't in our culture (just look at our savings rates). To those that say we are too inundated in debt, I counter with this: If all of our salaries doubled in nominal terms (not real terms), would we still be inundated in debt? That is the game plan. Anyone thinking cash is a great investment is completely disconnected from that fact and absolutely ignorant of policymakers' approach to economic policy. I say let the bond buyers be slaughtered. Being stuck in 2.6% 30 years won't feel like such a good decision when inflation is trending 5%+ annually in a few years.