Posted on 12/12/2008 10:56:27 PM PST by Lorianne
Jim Rogers, one of the world's most prominent international investors, on Thursday called most of the largest U.S. banks "totally bankrupt," and said government efforts to fix the sector are wrongheaded.
Speaking by teleconference at the Reuters Investment Outlook 2009 Summit, the co-founder with George Soros of the Quantum Fund, said the government's $700 billion rescue package for the sector doesn't address how banks manage their balance sheets, and instead rewards weaker lenders with new capital.
Dozens of banks have won infusions from the Troubled Asset Relief Program created in early October, just after the Sept 15 bankruptcy filing by Lehman Brothers Holdings Inc (LEHMQ.PK: Quote, Profile, Research, Stock Buzz). Some of the funds are being used for acquisitions.
"Without giving specific names, most of the significant American banks, the larger banks, are bankrupt, totally bankrupt," said Rogers, who is now a private investor.
"What is outrageous economically and is outrageous morally is that normally in times like this, people who are competent and who saw it coming and who kept their powder dry go and take over the assets from the incompetent," he said. "What's happening this time is that the government is taking the assets from the competent people and giving them to the incompetent people and saying, now you can compete with the competent people. It is horrible economics."
Rogers said he shorted shares of Fannie Mae (FNM.P: Quote, Profile, Research, Stock Buzz) and Freddie Mac (FRE.P: Quote, Profile, Research, Stock Buzz) before the government nationalized the mortgage financiers in September, a week before Lehman failed.
Now a specialist in commodities, Rogers said he has used the recent rally in the U.S. dollar as an opportunity to exit dollar-denominated assets.
(Excerpt) Read more at reuters.com ...
You might not like Soros, but he and Rogers were astute investors who recognized and profited from doomed government attempts to interfere in the economy, such as the Bank of England’s failed attempt to prop up the pound.
This is treating cancer with Vaseline and a Band-aid.
The external appearance is not even much improved on so much as a temporary basis.
And we will pay the price for decades to come.
From my recollections of Rogers, he is either a genius or a NUT. I suspect the later.
Jim Rodgers should go bankrupt. He’s a traitor who lives in China. He made big bets in commodities and he’s feeling the sting
As someone said on the other thread, Jim Rogers is a blowhard camera whore.
He is right and this is the moral problem we face:
“What is outrageous economically and is outrageous morally is that normally in times like this, people who are competent and who saw it coming and who kept their powder dry go and take over the assets from the incompetent,” he said. “What’s happening this time is that the government is taking the assets from the competent people and giving them to the incompetent people and saying, now you can compete with the competent people. It is horrible economics.”
“What’s happening this time is that the government is taking the assets from the competent people and giving them to the incompetent people and saying, now you can compete with the competent people. It is horrible economics
INCOME REDITRIBUTION YOU IDIOTS, YOU VOTED FOR IT!
Yes he does but the great majority of people will take this to mean financially bankrupt and that is PRECISELY what was intended by the dirt bag media. They know that only a small % of individuals are able to comprehend the intent of an individual when they read his quotes and depend on the reporting source to tell them what it all means.
>>“What’s happening this time is that the government is taking the assets from the competent people and giving them to the incompetent people and saying, now you can compete with the competent people. It is horrible economics.”
To bring to light a minor concrete example of this - my wife is on the board of a small specialty mutual insurance company. A division of AIG gets in their business from time to time (then they screw up / decide it isn’t worth it and get out), and is currently “in”.
Needless to say, those involved in running and managing this mutual insurance company are just *thrilled* that their tax dollars are being used to prop up their competitor.
“No ulterior motives here, move along.”
Except that he is right...why do you think “liquidity” didn’t return when Paulson threw all that money at banks?
The money simply kept them solvent enough to pay off depositors...they have nothing left to lend...their loans are simply not being paid back. Once they run out of this money, they will demand more...and we will have two or three more years of this....adding up to about $6T.
This is a nightmare.
I read one of his books, traveling on his motorcycle, a while ago
It’s not a question of liking Soros or Rodgers, traitors though they may be. It’s a question of believing what they say.
Here’s the question he needs to answer, “If these banks are technically bankrupt at this moment, would they still be bankrupt if the mark-to-market rule were eliminated?” The answer to that question in almost every case is NO. The SEC, with a stroke of the pen, could make them techically solvent again.
So this is just a Soros scheme to bring down the United States. In my opinion, he’s behind a lot of what’s going on now.
Is China going more towards capitalism or more towards socialism?
Is America going more towards capitalism or more towards socialism? (Re: the most recent election.)
If you had to make a long-term financial bet based on economics only, which would be the better bet?
That’s got nothing to do with Jim Rodgers being no good punk. Who has only disdain for the nation he was born in that gave him so much. Plus if you make big bets against America it’s better to keep quiet about it. Maybe you like Rodgers’ brand of libertarianism
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