We Study Billionaires - The Investor’s Podcast Network - TIP139: Jim Rogers - Macro, Gold, Junk Bonds, India, & Currencies (Stock Investing Podcast)

Starting point is 00:00:00 You're listening to TIP. Hey, how's everyone doing today? So we are super excited about today's guest, Jim Rogers. For anybody that's in finance, they definitely know who Jim is. Jim was the co-founder of the Quantum Fund with the legendary investor George Soros from 1970 to 1980. And during that 10-year span, Jim and George Soros had a 4,200% return when the S&P 500% return when the S&P 500 only had a 47% return.

Starting point is 00:00:32 So they definitely went down in the books as being two of the brightest traders during the 1970s into the 1980s. After that time, Jim retired and he went on to teach at Columbia Business School for a little bit. And then he started doing some amazing things where he literally drove around the entire planet on a motorcycle. And then he did it again in a car. He's written numerous bestselling books. He's an expert in commodities and currencies. And he really doesn't need too much of an introduction because I'm pretty sure anyone listening

Starting point is 00:01:07 to this show probably already knows who he is. In this episode, Jim Rogers reveals what he's currently investing in. We'll talk about why he is currently holding gold but does not add to his position. And we're going to talk about India and whether or not is a good financial manga to invest in. Finally, we're going to talk about what happened when press. and follow Jim's advice to short junk bonds back in 2015. Let's go ahead and hop to it. You are listening to The Investors Podcast, where we study the financial markets and read the books that influence self-made billionaires the most.

Starting point is 00:01:44 We keep you informed and prepared for the unexpected. I can't even tell you how just thrilled I am to have you on the show, Jim. I'm a huge fan. I've been reading your material for years at this point. and the first thing I want to talk to you about is gold. A lot of people saying to buy gold, and you're one of the few that I've read over the last couple years that you have a position in gold,

Starting point is 00:02:17 but you're very hesitant to increase that position at this point in time. And we're recording this. For people listening to this in the future, we're at the second quarter of 2017, just to kind of give you a reference of time here. And so you haven't been increasing that position. And I have a similar opinion as you as to not taking a position. and gold at this point. But I'm really curious to pick your mind as to what are some of those

Starting point is 00:02:41 critical things that you're looking for that would change that opinion for you, where you'd then start taking a position again? What would change by, I don't know, gold collapsed to 950 U.S. dollars and outs. I would probably brush in and buy a lot of gold. Price, I guess, is the main determinant or time. If this were 2019, I might brush in and buy some gold. You know, gold hasn't had enough of a correction yet for me, and there's still too many bugs. I'm too many bulls. You know, everybody, have millions of gold bugs out there. When they give up, I hope I'm smart enough to buy gold.

Starting point is 00:03:17 So you're really looking at it more from a psychological standpoint of there's too many people talking about how it's a good trade. Whenever everyone's going to say, you've got to run for the hills on gold, it's a disaster. That right there is when you see that as a prevalent narrative. in the market, that is when you know it's the right time to buy. Is that a correct statement? Preston, when they say, I never want to invest in gold again as long as I live, that's when I want to invest in gold. That's true of many things. You know, when everybody gives up and throws it out the window, that's usually a good time to buy anything, including gold. And so far, there's still too many people who love gold. You know, for me, I was kind of expecting you to come with more of a

Starting point is 00:04:01 quantifiable approach to it, I guess. So I'm really surprised at how qualitative it is. Investing Preston is qualitative, quantitative. It's everything. I mean, I wish it was so simple. I wish you could just look at turn to page 37 and say, ah, there's the answer. There is no simple answer in the investment world. It's a combination of everything. And that's the case with gold and everything else. Gold has been around for thousands of years. Gold has had many periods when it's been in the bull market, many periods when it's a bear market. Gold is just another investment. I know that many people think it is a currency, it is a blah, blah, it's a this, it's a that.

Starting point is 00:04:46 Gold is just another investment like everything else, just another commodity like everything else. Go back in history and you will see that gold is just another investment like everything else, whether we like it or not. So I have one more question on this, and I'm sorry to keep hogging the questions here, Stig, but when it comes time for you to put on this play and put it on thick, what do you think would be the best approach for an investor to take? For me, I'm thinking the best way for me to do it,

Starting point is 00:05:13 and I really want you to shoot holes through this idea is what I want you to do, Jim. But for me, I'm thinking the best way to do this would be to put a two-and-a-half-year call on some gold mining companies. Why is that a bad idea or talk me through a, how you would say that that'd be a terrible approach or a great approach? Well, Preston, if you get the timing right, please call me too and tell me it's time. Two and a half year call would be fantastic. If you get it at the bottom, there's no question about that.

Starting point is 00:05:42 You've got enormous leverage with calls and stocks. Stocks usually go up more than the item itself. You can also do it with futures because the futures on gold itself. You can also get enormous leverage. if you get it right, you get the timing right and the product right, then you get enormous leverage and that's what you're looking for. So futures or calls at the right time on the right item will make you a staggering amount of money. Now, once you do it, you please call me, okay, because I need to know when the bottom is too. So I love that because you're telling me that

Starting point is 00:06:20 it's a good idea, but only if you're really good at timing the market, which I think you're very suspect of anybody who's good at timing the market. And is that a correct statement? Well, I'm not a good market timer. I'm the world's worst market time. I'm the world's worst short-term traders. So, yes, that's why I'm asking you to call me when it's at the bottom. But Preston, if you had told me that in 2014 and you had done it, you would have lost everything. Yeah. Your call would have expired by now, and we'd be sitting here talking. about, oh gosh, let's talk about baseball or something because you would have lost your whole investment.

Starting point is 00:06:57 Fortunately, you didn't tell me that in 2014 or I might have followed up on it. So, Jim, I have the next question here. I know that you always been on the forefront of various markets. You wanted to buy Danish Kroner, though it seemed like no one knew where Denmark even was. Could you talk to us about these ideas that might sound crazy to many people? and how do you validate those thesis before you put in money? Well, I have learned in life that the more people ridicule you and the more people question you and laugh at you

Starting point is 00:07:28 that you're probably onto a good thing, no matter what it is. And there are times in life that if you are observer and you find change, to me the most important thing is to find something that's cheap. And if it's ridiculed and ignored, it's probably very, very cheap, such as the Danish Corona was, and nobody even knew what it was back in those days, you're probably going to make a good investment if you find change. Kind of going on that theme, Jim, when you think of investments that, I mean, so much of our audience is in the United States,

Starting point is 00:08:02 when you think of areas in the United States markets, whether it's currencies, commodities, bonds, stocks, where do you see that where a person could actually kind of apply that thinking and that thought process? to a pick in the United States? Well, you look out the window, you look at the market, you read the newspapers, you watch the investors podcast, whatever, wherever you see that people are down on something, and it's depressed, and there may be an investment opportunity there. Agriculture in America is pretty depressed right now, as you probably know, and may be an area where there's an investment opportunity.

Starting point is 00:08:41 Just because something depressed, Preston, doesn't mean, you know. you should be investing there because it can stay depressed for a long, long, long time. You have to find a change that's taking place as well. As I say, something can be depressed for 15 or 20 years. You have to find the change, and change doesn't happen every day. But if you can find something cheap and if you can find a positive change, maybe you should do more homework and find an investment. Jim, could you talk to us about Catalyst?

Starting point is 00:09:13 because you're talking about how difficult it is to time the market or time a depressed asset. Some people would be saying that value in itself would be a driver, but how do you assess catalyst and when do you see that something is about to change so it will realize it's intrinsic value? Well, Stig, you've hit on it again. I mean, that's the important part. I have learned about me, because I've been investing a long time, that I'm usually too early, that I see something happen and I assume everybody sees what I see. I now know they don't.

Starting point is 00:09:48 I now know I see it much too early. So I've learned to wait a year or two. But the change, the catalyst, as you call it, could be anything. But again, I want to emphasize, even when you see the catalyst, it doesn't do any good unless everybody else sees the catalyst too and unless the effects come through pretty quickly. and in life and in the world, it usually takes a while for the catalyst to work its way through. So, Jim, I want to hit on a theme that you talked a lot about in your book, Street Smarts. In your book, you talk about this idea that the capital flows are drastically changing from what the U.S. had experienced over the last 75 years.

Starting point is 00:10:30 And you feel that a lot of the big opportunity is now being presented over in China, Singapore, and most of Asia. and leaving Europe, leaving the U.S., and leaving Japan. Whenever I was reading through your book, I kept thinking through this Ray Dalio narrative with these long-term credit cycles. Is that how you see this? Is that how you're able to see maybe this trend that you're talking about in your book?

Starting point is 00:10:56 Do you see it in a similar light as Ray? Well, Ray is a lot smarter than I am. You know, a lot of people are a lot smarter than I am. But I do perceive that the world is changing now. The world has always been changing. No matter what you think is true today in 2017 is not going to be true 15 years from now. What all of us think right now, you pick in a year in history, and you look 15 years later and everything that people thought in 1900 or 1920 or 1950, pick the year, 15 years later,

Starting point is 00:11:30 the world was completely different and everything had changed. So yes, that is happening, but in an even bigger problem, picture than 15 years cycle. I mean, look, whether we like it or not, I don't particularly like it, but Asia is rising. Asia's where the money is. Asia's where the energy is, ages where the ambition and drive is, and the brains. China puts out something like 10 times as many engineers every year as America does now. That's going to have an effect someday. Maybe not this afternoon. Maybe not this weekend. But it's going to have an effect someday. And so the world, The world is changing once again.

Starting point is 00:12:10 In 1807, the smart people moved to London. In 1907, the smart people moved to New York. Well, in my view, the 21st century is the century of Asia. You can ask me in 75 years, I will know. You're too early, Jim. I already know that. You're right. I'm always too early.

Starting point is 00:12:33 Jim, I got a question about the root cause of that. Do you really pin that on central banks, the root cause of why that's happening? First of all, in the historical context, we haven't had central banks for most of history. But at the present time, yes, a lot of what's happening in the world is because of central banks. And in America, we've had three central banks. The first two disappear. In my view, this one's going to disappear, too, because they're making so many hopeless mistakes. But yes, central banks are a powerful, powerful influence in the world right now.

Starting point is 00:13:05 They have enormous amount of money and therefore power and a lot of what's happening in the world. For better or for worse, is because of central banks, especially the American Central Bank, the Federal Reserve. They have more influence and more money than everybody else. So one of the problems that I have wrapping my head around macro is when you see the actions of the Federal Reserve and all these crazy policies that we're seeing now, how is it that the dollar keeps getting stronger relative to these other currencies? Is it because the other central banks are even worse than the U.S.'s central bank? Or like, explain to me how the dollar can have this search from 2013 until now. The dollar has just been on a rampage.

Starting point is 00:13:48 Explain to me how that happens. I just don't understand. Let's take a quick break and hear from today's sponsors. All right. I want you guys to imagine spending three days in Oslo at the height of the summer. You've got long days of daylight, incredible food, floating saunas on the Oslo Fjord, and every conversation you have is with people who are actually shaping the future. That's what the Oslo Freedom Forum is. From June 1st through the 3rd, 2026, the Oslo Freedom Forum is entering its 18th year, bringing together activists, technologists, journalists, investors, and builders from all over the world, many of them operating on the front lines of history.

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Starting point is 00:18:13 The others are so bad. They're so hopeless. I mean, the Japanese central bank, the guy said, the head of the central bank said, we will print unlimited. That's what he said, unlimited amounts of money. if we have to. I mean, anybody thinking about the Japanese yen has to think about unlimited amounts of money and Japan has staggering internal debts, huge internal debt. But you look at the euro. I mean, the euro is a wonderful concept, but the execution has been hopeless. So you look around

Starting point is 00:18:44 the world and there are not many alternatives. Now, the US dollar's got horrible, horrible problems. It's a terribly flawed currency, but press, when people think about safe, havens. The first thing they think of as the U.S. dollar for historic reasons. And second of all, then they look out the window and they say, well, I don't want to buy euros. I don't want to buy, yeah, et cetera. So the U.S. dollars are a place that people put money. What's going to happen is the dollar's going to get overpriced. It might even turn into a bubble as the turmoil gets worse and worse. At that point, I hope I'm smart enough to sell my U.S. dollars and buy something else.

Starting point is 00:19:22 Jim, just another question about this and how it occurs. Because this is hard to really find a lot of easy to understand writing on this and how it kind of unfolds. So when this starts to go into this spiral, which is where I would classify the Bank of Japan right now, I've read different things where it says that in three years they might run out of bonds to basically buy off the market. And that the stock market, I mean, what do they own? I forget the stat. It's something like the central bank in Japan owns something like 10% of the stock market. It's some crazy number like that.

Starting point is 00:19:58 I apologize for not having the stat at hand here. But whenever they run out of those assets to basically swap currency for whether it's bonds or even stocks at this point, is that when we start to see the currency to just go into the hyperinflation mode? Or is it just different because of the fact that we're dealing with central banks and that's not something that we've necessarily seen in history? Well, it's somewhat of a closed economy and closed society. It's a little bit unique in that they can continue to trick each other for a long, long, long time. They can say everything is great. And in HK, the Japanese TV network will say everything is great.

Starting point is 00:20:38 And the emperor will say everything is great. And so everybody in Japan will believe it. I don't know when this is going to happen. But Preston, I will tell you that we have had economic problems. every five to 10 years since the beginning of time, and we're going to have them again, no matter what the press tells you. And when they happen again, it's going to be worse next time because of some of the things we've said, not just in Japan, but worldwide.

Starting point is 00:21:07 Japanese will print, he said we will print unlimited amounts of money, and he's got an unlimited printing press. And NHK will say every night, don't worry, everything is okay. the emperor still and the imperial palace. And this is not going to end badly. It is going to end badly, whether we like it or not. Well, we're not even talking about the impact of negative interest rates. Preston, right now, many, many pension plans are being ruined.

Starting point is 00:21:35 Many people who saved their parents said, you save your money, you invest for the future, and everything will be okay. All of those people who did that are being ruined because they save. they're getting negative interest rates or zero interest rates, whether it's the pension fund of Illinois or the down one for X, Y, Z university, they're all getting ruined in an attempt to save the people who did it the other way. The central banks say, oh, these people borrow too much money. They didn't save. They spend money they didn't have. We're going to save them. But that's at the expense of the people that your parents said to save your money for the future. We're ruining

Starting point is 00:22:21 the people who saved for the future at the expense of the people who did it the other way. So let's talk about India. There's been a lot of focus on India at the time. I'll also know that you have taken position in there as well. Could you talk to us about the sustainability of the Indian economy? It seems to me that when you look at Northeast Asian economies that have done really well. I have this formula of cultivating the land, going into manufacturing, having policies, especially in terms of the financial institutions of how to support the agricultural sector and the manufacturing sector. And when you look at a country like India, it kind of seems like you want to skip the steps and go directly to IT and more advanced services. So how do you look at the sustainability

Starting point is 00:23:07 of the Indian economy? Am I wrong in that assessment? Well, not in my view, but I'm not I haven't been a very good predictor of India, but you're exactly right, but you have to remember, Stig. Yes, there are one billion Indians. You and I know about IT in India, but that's such a tiny, tiny, tiny part of the Indian population. Now, the Indian government loves to tell you that things are great, but you go to China, you go to India, and you can see. Even if you don't accept government numbers, which I don't, anywhere, you will see. Things in India are not nearly as well as they are in Korea or some other places just looking out the window.

Starting point is 00:23:50 I have occasionally invested in India. I've sometimes gotten it right, usually gotten it wrong because of the timing. You know, India has a lot of debt. The Indian government doesn't like to talk about them, but the debt, the GDP ratio is very, very high in India, and it's getting higher and higher and higher. That usually means you cannot grow at a rapid rate. And it's really interesting what you said about the IT sector, which is basically what we think about in the West whenever it comes to India. We're talking about less than 3%.

Starting point is 00:24:19 And when we talk about manufacturing, which is historical being the thing it really takes a lot of countries to the next level in terms of development, we're only talking about 14% employment, which is very, very little in comparison to other countries. So what is the driver for a country like India? Where does you go if you're looking at sustainable growth? Unfortunately, I don't see a lot that's for sustainable growth in India. You look out the window, you don't see any Indian products. We all know Japanese products, Korean products, German products. I doubt if you can name more than one or two Indian brands or names of products that you buy,

Starting point is 00:24:58 look around your office, your home, you'll see products from a lot of countries. I don't think you'll see any products from India. And the reason for that is there aren't any. They haven't had great manufacturing success or except in a few IT countries. So I don't see it. India used to be one of the great agricultural countries of the world. They've got the weather, the soil, the rain, labor, and everything else. But the government in India has protected the farmers.

Starting point is 00:25:28 Farmers in India cannot own more than 12 acres. That's for their own good. That's to protect them from the evil foreigners, et cetera, et cetera. Well, how can somebody with 12 acres compete with Australia who could have 120,000 acres or, you know, a million acres, whatever it is? Can I compete with 12 acres? But the Indian government is protecting all of those poor farmers like they protect many, many parts of Indian economy. And that's one reason that India has not done as well as China or other places. Jim, I want to talk about, in your book you briefly talked a little bit of, a little bit of,

Starting point is 00:26:06 about your time with George Soros. I'm curious and I really appreciated you addressing your reasons of why the split ultimately occurred. But what I want to talk about is the time that you were working with George, what would you say was the one thing that was his just total strength that you took away from it, that you really kept for yourself that you kind of learned from him? And then what would you say you gave him? I left there 37 years ago. You weren't even born, but I haven't had any condoms. I haven't had any contact since. But I will say that both of us were dedicated and passionate of what we were doing. He was a great market timer. Jim, sorry to interrupt. What gave him that skill,

Starting point is 00:26:47 would you say? I don't know. I don't think you go to school to learn to be a great trader. I think you either have it or you don't. The timing part of it was really him, but the research and why you might take a position for over the next five years and continue to hold it through that duration was a lot of you're doing as far as the teaming that you two had. Back in those days, yes. As I say, I haven't seen him in 37 years, so I have no idea what he's doing since him. But in those days, that's what we did, yes. Yeah. No, I appreciate you talking about it because I know a lot of the things that I read about you today, Jim, it's usually not brought up. But for a lot of your fans and for people that really kind of want to understand those

Starting point is 00:27:28 early days of, I mean, what was your return for the first 10 years? In the 10 years of the 70s, we earned 4,200%. But Preston, so what? I said to say, you might as well ask me about my first one. Come on. Jim, Jim, you got to understand your fans. People like Stigamy. We want to hear these stories.

Starting point is 00:27:47 This is amazing stuff that how many people can say they ever had such a return? It's just unbelievable. It's absolutely amazing. So we appreciate you talking about it. Jim, let's talk about some of the things that you're really good at Because people might be confused out there because they're listening to you talking about all the things that you can't do. If they were to do a Google search, they can see how successful you've been as an investor. You just talked about you more than 4,000% return in just 10 years.

Starting point is 00:28:15 So I know that you're a very modest person, but could you tell us what you think your competitive advantage is in the investment field? Well, I don't know. Whatever success I've had stick has been because I've found things that were very cheap, where there was positive change taking place and I invested usually too early, but then I held them for years. And if you get that right and if you do it every once in a while, you'll probably make a lot of money. If I have any comparative advantage, that's what it is. That for some reason I can see things changing usually too soon, but then if I get it right, I make some money. I make a little bit of money when I get it right.

Starting point is 00:28:56 Would you say these guys that are really good at it? at the timing, are very focused on the price action, or are they really focused on the news, or is it a combination of both? Well, the price action is because of the news, nearly always. You know, when you see the news, the disaster is happening. It usually leads to price action. And Mike or Roy or whoever they were had the sense to figure out, ah, this is a buying opportunity. I love to see disaster because disaster I know usually leads to opportunity too, but I'm not a short-term

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Starting point is 00:33:36 to short the market at all. I came on the podcast back in December of 2015 and I talked about this position, and I have to acknowledge, I did not give you credit for the idea on the show, but now you are getting credit, which the position has gone down. Since I put that on, it's gone down about 10% I'd say from whenever I bought it. And to this day, I still have this position because I still think it's a good position to have on because I think that the high yield bond markets, you know, ripe for explosion. It's so exciting for me to ask you this question, because, I mean, I don't have a really big position on this. I just, thought it was a unique idea. It was kind of fun to talk about on the show. I still get emails

Starting point is 00:34:18 from people to this day about that position and whether I still have it on. And I answer, yes, I still have it on and I sleep well with the position on, even though it's gone down 10%. I want to hear your thoughts on this position. President, I told you, don't listen to me for market timing. I'm coming to you for market timing for goodness sake. I have learned that I see something and I have to wait a year or two. Well, Now, we've got to wait some more. I certainly own the position because I know like you that the junk bond market is going to totally disintegrate someday. But I'm hopeless at market timing.

Starting point is 00:34:54 I still have it own. I still have mine on, too. I'm too late to change. I know it's going to fall apart someday. But in the meantime, because my market timing is so hopeless, I'm losing money just like you. But eventually, the junk bond market is going to collapse. I hope I don't collapse first. No, there's no question.

Starting point is 00:35:15 It's a very simple thing. The world does not work so that people can borrow staggering amounts of money and have very few assets, very little money-making ability, and continue to go on and on and on and on. No, of course, it's going to fall apart. But I may fall apart first because my timing is so bad. Yeah, I might need to increase my position on that. Don't it.

Starting point is 00:35:38 Don't because of me. I tell you, my market. timing is hopeless. Jim, that was my way of queuing you. Hold on. Let me find my phone. Let me call up. Call up and try to add some more. Okay, so Jim, I would like to talk about the size of positioning because it seems to me whenever I've been following what you have been doing, it seems to me like you have many ideas, but you're also very picky about which ideas you're really going to pull the trigger on. So could you talk to us about how do your size your positions and why? I don't have a preconceived position size. I buy it as long as I think the

Starting point is 00:36:19 price is right and the opportunity is right. And then when I run out of money or run out of patience and then I stop. Part of the problem, Stig, is I don't have a committee. I only invest my own money. So I don't have to explain to a committee of wise people what I'm doing or why I'm doing them and defend it. So I just do it until I get tired or run out of money or whatever and then I stop buying or until, you know, something else comes along and I start putting my money there. I mean, it's not disciplined. It's sloppy. It's hopeless. Maybe I should have a committee. But at the moment I have enough money that I can get away with being sloppy. Jim, I'm really curious to hear your response to this one because one of the things that I've worked

Starting point is 00:37:05 hard recently on is trying to come up with the indicators that I use to understand business and credit cycles. So whenever you're at the top of a credit cycle and it's starting to contract, what are some of those key indicators that would tip you off to that part of the business cycle to occur? So for me, some of the things that I have written down and I have a list of about eight to ten different things that I'm constantly looking at as like a reference. And when all of them are pegged in a certain area. I'm saying, you know, I think we're at the top of a credit cycle. So just to give you a sample of what I'm talking about, so the unemployment numbers, whenever I feel like the unemployment numbers are really starting to hit a bottom and plateauing and

Starting point is 00:37:47 starting to actually turn up, I think that that's a really critical thing to understand of where you're at in the business cycle. Another one, Raoul Powell, who I know you're good friends with, he likes the ISM, the manufacturing index as a good indicator. Another one that I use is the high-yield bonds when you're starting to see high-yield bonds start to turn. Is my line of thinking for the three that I mentioned on track? Would you agree with that? And I'm really, really curious, Jim, seriously, if you can give us some metrics that you consider

Starting point is 00:38:17 that you really pay a lot of attention to, please tell us that because I would love to write this down and annotate it. Well, I'm pressing. I mean, you see them throughout history. All bubbles look the same. All market tops look the same. All credit tops look the same. You have to get the timing, of course.

Starting point is 00:38:34 But when you see everybody buying X, you have to start saying, well, wait a minute, I've seen this before. When you see everybody saying it's different this time, but it's never different this time, Preston. Most dangerous words in the investment world are, it is different this time. It ain't ever different this time. You know, I'm not the first person to figure that out. When you see on the radio or the TV or the Internet that everybody's doing something, I hope. that a little bell goes off in your head and says, well, maybe I better start thinking about going the other way.

Starting point is 00:39:11 The debt numbers skyrocket, the borrowing skyrocket, the junk bond borrowing skyrocket. All of these things have happened many, many times in history. You and I are not the first people to see the top of a credit cycle. Go back and read, whether it's any time in history, it's always, they've always said and done, the same things. Well, in our opinion today, in the second quarter of 2017, Stig and I both believe that

Starting point is 00:39:42 that's kind of where we're at right now. Now, whether it runs another year or two, we have no idea. But we really believe that we're seeing that happen right now in the U.S. Do you agree with that or you think this thing has a lot more to run? Of course, it's correct. It's simple, as I said. It always happens the same way. You look at any kind of debt measure you want, whether it's margin debt.

Starting point is 00:40:04 household debt, corporate debt. You look at it. They're all making historic highs. Everybody's convinced that they cannot lose money and bonds. I mean, these things have happened before, and it's happening again. We've always had problems every five or ten years. In the world, economic problems. We're going to have them again.

Starting point is 00:40:26 The next time, it's going to be the worst in your lifetime. And mainly because there's such staggering debt everywhere. We had a problem in 2008 because of debt. Look out the window. The debt is much, much, much higher now. In 2017 and it was in 2008 and it's going higher every day. This is going to be a very, very big problem. You're instig right.

Starting point is 00:40:51 I got a question for you. When we're thinking through what's going to be the catalyst, the first thing that comes to my mind is European banking. I think European banking, if the whole Deutsche Bank, credit Swiss, Italian banks, if that really, really starts to unravel itself, similar to what we saw in 2008 in the U.S., I really think that that could have the potential to have a very substantial shock to the system. When I think through all the other events, I think that they could cause credit to start to

Starting point is 00:41:17 contract and start getting into that situation, but I really, really believe that the European banking is probably the scariest thing that we face from a fundamental standpoint. Would you agree with that, or do you see something else as being a major threat? These things usually start where we're not looking. In 2007, Iceland went bankrupt. Most people say, Iceland, what's Iceland? I didn't even know there is an Iceland or that they had banks. But it went bankrupt.

Starting point is 00:41:43 And then that snowballed. And the next thing you knew Ireland went bankrupt. And the next thing, you know, Bear Stearns went bankrupt and Lehman. You know, that's how these things nearly always were. So right now, there's probably something running into trouble that you and I are not paying attention to. and it's not registering. And it's going to snowball. Yes, those European banks are going to have problems down the road.

Starting point is 00:42:07 Some are going to go bankrupt. But you think American banks don't have problems? Oh, my gosh. You kidding? In America, we have something called the FDIC, Federal Deposit Insurance Corporation. It's bankrupt. You know, it's still there, and there's not a run yet. But the FDIC, once you start having problems in the American banking system, the FDIC is bankrupt.

Starting point is 00:42:30 It can't meet its obligations. It's going to happen in many places. Georgia banks are a good name to use, but there are plenty of them. So what's the correct strategy here? Now we're talking about how so many assets are overpriced. We're also talking about how we can't type the market. Either of us, perhaps Preston. But we can't time the market either.

Starting point is 00:42:52 So we would have a lot of people asking, okay, so we're not going to short the market, but we still want to invest our money somewhere. This needs to you, is it a play where we're going to block to the U.S. in terms of the U.S. dollar? Because if it crashed, we will see that rally. Or how do you position yourself whenever everything is overvalued as it looks right now? Well, I've mentioned some things. I own a lot of U.S. dollars. I'm short junk bonds, agriculture.

Starting point is 00:43:19 I've mentioned agriculture has been a disaster for a long time. I own China, although some parts of the Chinese economy are going to collapse. They're going to be bankruptcies. And some parts of the Chinese economy are going to do fabulous. I mean, China's a horribly polluted nation. The government is spending unbelievable amounts of money to clean it up. So the people cleaning up China's pollution are going to do well even if Europe disappears, you know, because there's such a horrible problem. So some parts of the Chinese economy are going to do well no matter what, while others go bankrupt.

Starting point is 00:43:53 Russia's hated. I'm optimistic about the changes in Russia. There are places that are depressed where one can put money if you want. I own gold and silver. I'm not buying gold and silver at the moment. There are opportunities. I'm sure there are many opportunities that I'm just too lazy to get around to. All right.

Starting point is 00:44:13 So, Jim, we seriously cannot thank you enough for coming on the show. As big fans of yours, we are just so honored to have you here. I'm just, I'm starstruck talking to you. So this is really exciting. I want to tell our audience, the two books of yours that I have read is, investment biker and street smarts. Just fantastic reads. If you want to get a glimpse of what it's like to go country by country around the world on a motorcycle, some of the stories of, you know, crashing and not having the parts and just, I mean, oh my gosh, just unbelievable stories.

Starting point is 00:44:47 If you want to be entertained and you're interested in investing at the same time, you'd be crazy to not pick up his book investment biker. But Jim Rogers, thank you. for coming on The Investors Podcast. We were honored. Thanks, Dick. Thanks, Preston. I hope we can do it again someday. Thank you, Jim.

Starting point is 00:45:06 We'll definitely tell you open that offer. All right, guys. That was all that Preston and I had for this week's episode on the Amherstors Podcast. We see you together again next week. Thanks for listening to TIP. To access the show notes, courses, or forums, go to theinvestorspodcast.com. To get your questions played on the show, go to AskTheInvesters.com. and win a free subscription to any of our courses on TIP Academy.

Starting point is 00:45:31 This show is for entertainment purposes only. Before making investment decisions, consult a professional. This show is copyrighted by the TIP network. Written permission must be granted before syndication or rebroadcasting.

We Study Billionaires - The Investor’s Podcast Network - TIP139: Jim Rogers - Macro, Gold, Junk Bonds, India, & Currencies (Stock Investing Podcast)

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