Posted on 10/24/2007 11:33:59 AM PDT by ConservativeMajority
I may be no rocket surgeon, but what kind of idiot would want to invest in China if their major export country (US) was going into a recession?
Can't argue with that one.
The Chinese currency, known as the renminbi, or yuan, is "the best currency to buy right now," Rogers said. "I don’t see how one can really lose on the renminbi in the next decade or so. It’s gotta go. It’s gotta triple. It’s gotta quadruple."
China's currency is still loosely pegged to the dollar, so I have no idea what he's talking about here.
And how the hell do you invest in a country where all of the industries are state-owned, there's no such thing as private property, and the only value the currency has is its relationship to the currency of its largest export customer (the U.S.)?
Soros plans to own ALL of the candidates. So far, he has Hillary in the bag, is planning on getting his boy Rudy nominated, might be throwing $ to whoever the Libertarians nominate, and just may find himself someone pretending to be a religious conservative to back, so that he owns the White House after ‘08 no matter who you vote for.
Although Rogers does sometimes sound zany, over the years I’ve gotten excellent returns from Rogers’ investment ideas. Not all of them have been good, but often he’s been right in a big way (that makes up for small losers).
I’m having a really hard time believing that Rogers continues to be referred to as a “highly regarded” investor when he’s completely abandoned any pretense of his increasingly bizarre love affair with all things China.
“I do not want to sell Chinese stocks. I want to own them forever and I want my (four year-old: Quote, Profile, Research) daughter to own them.”
That quote from Rogers is as telling as anything he’s said previously. I believe Rogers truly believes China is going to be “the most important country,” and that China will eclipse the U.S. into near-oblivion (as he’s spoken of many times in the past), but I don’t believe he’s objective about it in the least. He increasingly reminds me of American teens obsessed with Japanese animation when he talks about China.
The Chinese have been devaluing their currency to make sure the goods they export remain cheap enough to drive economic expansion.
As the yuan increases in value, their domestic production costs soar compared to what they get for selling the goods in the US.
As the yuan soars, the Chinese people will be able to afford more imported goods. If imports are allowed to compete with domestic products, the Chinese people will be able to have a higher standard of living on the same wages.
However, for the Chinese to continue economic growth, they need to have a market for their goods. If the US economy is in recession, their sales to the US are going to drop? Who is going to buy their goods, the Chinese people themselves? A more prosperous Chinese people threatens the Chinese government's control over it's people.
It is much easier to control people who are dependent on the government and have no real means by which to flee or revolt.
As the US dollar slides, we Americans can afford less imported goods. That will definitely effect our standard of living. However, it should also make domestic production and exports much more profitable again, so it should help us work our way out of any economic slump we might be in. That is as long as we don't ask our government to interfere and try and solve the problem for us. If we do that we'll strange ourselves.
From the mouths of babes...but you could be a brain scientist... or at least have driven past a holiday inn express...
American business was slow and stupid, the hardworking, super smart japs were going to buy America.
OK, works for me.
I think he’s betting the peg will be lifted at some point.
It’s probably a good bet, and in the meantime how can you lose taking US dollars and converting them to yuan? If the peg holds, you lose nothing, if the peg is lifted, there’s at least a temporary surge in the yuan and you can buy back your dollars then.
I’m surprised you can GET yuan right now given the artificial imbalance, I can’t imagine why anybody would SELL you yuan for the official exchange rate.
A recession = 2+ quarters of negative growth. Thus far, 0 such quarters. End of story. The MSM is trying to create another self fulfilling prophecy.
Rogers is simply telling the truth from his perspective. He’s a commodities guy, not a stock guy. And right now, commodities are hot. Rogers told people back in ‘99, well before the election, Bush or the Iraq war, that we had bottomed out of the previous commodities cycle and that in the next couple of years, the easy surpluses of commodities were going to dry up.
He was right.
Right now, the best place to be positioned in the market is with companies that make/sell “stuff” - particularly those companies that make “stuff” and sell it overseas.
Exactly. Try to ruin the economy and create a “recession” right before the election. Is what this guy doing legal?
Nevermind, dumb question.
I'm not a guru, but I would advise you not to pay heed to wobbleheads like this guy. Why is he out advertising his moves?
This was in the Financial Times today ....
http://www.ft.com/cms/s/1/c424190e-7e7f-11dc-8fac-0000779fd2ac.html
Spinning cotton Published: October 24 2007 09:41 | Last updated: October 24 2007 20:30
Lex: Cotton: the next commodity craze?
Having already helped push up the cost of meal times, Washington’s love affair with ethanol might now do the same for the shirt on your back.
Cotton is the latest commodity to feel the inflationary effect of government incentives designed to encourage US farmers to grow more corn for ethanol, a fuel additive. As land is turned over to corn, there is less acreage available for other crops. That has already fuelled a boom in wheat prices. In the 2006/07 planting season, just under 11m acres of cotton was planted – down 29 per cent on the previous year. A further drop is expected next year. And no wonder: the cotton price has risen only 17 per cent this year compared with 35 per cent for soyabeans and 67 per cent for wheat. As cotton is also trickier to grow, switching into wheat or beans is a no-brainer for most farmers.
With global inventories of cotton shrinking, there is talk of prices hitting $1 a pound, a level last seen in 1995. That is still far below the $12 level, in real terms, reached during the US Civil War. But it would mean a 54 per cent gain on the current price of 65 cents.
As with many other commodities, the actual amount of cotton that is physically traded is low. At its current price, the implied size of the annual market is $36bn, making it comparable with nickel, which tends to be volatile and has been subject to a short squeeze in the past year. And while acreage is declining in the US, high prices will encourage other producers – particularly in China,the world’s biggest importer of cotton – to grow more, causing a sharp correction. Only those investors with impeccable timing should buy direct exposure to cotton. Others risk losing their shirts
my husbands’boss apparently doubled the value of his stocks last year, and quadrupled his wifes’....I don’t know how he did it, but he did it on his own, and I think he was heavy into RIMM.
“Only those investors with impeccable timing should buy direct exposure to cotton. Others risk losing their shirts...”
That’s generally the way I view this market. Add to that the fact that it was at least a year ago that Rogers made these comments...
Yeah, I still think he’s pretty nutty.
sure it is, and the recession coincides with the Dems taking control of the congress.
I guess I better close up shop and wait until this thing is over. Wouldn’t want to disappoint the media ya know.
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