Posted on 04/21/2010 8:56:07 AM PDT by Comrade Brother Abu Bubba
The Great Recession that may have just ended will amount to nothing compared to the next one, says commodities expert Jim Rogers.
The huge fiscal and monetary stimulus is what will cause the crisis, he says. Rogers notes that the United States suffers a recession every four to six years on average.
VIDEO — Jim Rogers: Next Recession Will Be Much Worse
Federal Reserve Chairman Ben Bernanke is a big part of the problem, says Rogers, chairman of Rogers Holdings. “Mr. Bernanke can’t print much more money again. The world is going to run out of trees.”
That’s thanks to the mistakes made by Bernanke and his predecessor, Alan Greenspan.
“They’ve taken on gigantic amounts of debt that you and I are now responsible for. The central bank is making it worse,” Rogers said.
Bernanke’s low interest rate policy is a terrible mistake, Rogers says. “He’s essentially ruining the U.S. economy in the long run and ruining the U.S. dollar as well.”
The dollar’s safe for now, Rogers says, noting that he owns it himself. “But in the longer term, the dollar is a terribly flawed currency.”
Inflation already is here, he says.
That inflation is reflected in higher oil prices, and the surprise will be how high oil rises over the next decade, Rogers says.
“Known reserves are declining at a steady rate,” he points out. “Unless somebody finds a lot of oil very quickly, the price of oil is going to go much higher.”
There’s a very good chance that some governments will default on their debt in the next few years, he says.
“I do know that they’ve run up staggering debts in Washington, and that usually leads to problems down the road.”
(Excerpt) Read more at moneynews.com ...
I trust Jimmy Rodgers, I do not trust Bernanke and Greenspan (the worst public speaker in the history of humankind!)
Wake me up when there’s some good news.
A NEW recession? Since when has the one we already have gone away? Economy? Jobless rate? National debt? Government spending? Radical taxation?
What did we miss??
I agree.
If things really go south here, Singapore is a GREAT option. For those that have never been, it is an extremely safe and remarkably clean city. English is the language of choice, so you'll have absolutely no communication problems.
“Known reserves are declining at a steady rate,” he points out. “Unless somebody finds a lot of oil very quickly, the price of oil is going to go much higher.”
Inflation is a monetary problem of having the supply of money increasing faster than the increase in production (or decreasing more slowly than the decrease in production during a recession). Rogers is trying to prove that there is a monetary problem by using a commodity's supply problem weakens his argument considerably. The price of oil going up because of lack of supply is not inflationary because the rise in oil prices and items affected by the price of oil will be matched with a decrease in other prices. For example, If I have to spend more for gas I'll spend less on eating out and restaurants will have to drop their prices. That works unless the Fed boosts the money supply, but that is the inflationary event, not the supply driven rise in oil prices.
Now, you can argue that all the printing done by Ben "Ink Stains" Bernanke and Timmy "Tax Cheat" Geithner will likely cause inflation. The only thing that has held it back is banks being reluctant to lend money thus decreasing the velocity of money and the multiplier on the money supply. The problems of the Fed after 2001 of keeping the interest rates too low for too long causing investors to get stupid in the following decade lead to the real estate bubble and crash. Bernanke looks like he will repeat Greenspan's greatest error.
It is safe and clean. Also tiny...also expensive relative to other spots in Asia.
WTF is LOL, Alex?
What can he do? He can’t raise rates because of all the ARM coming up for re-finance.
But Newsweek said the recession is over and it’s happy days from here on out! WTF?? </snark>
Jeopardy ping
I guess I remain skeptical of Rogers...he was a co-founder of the Quantum fund...George Soros’ Quantum Fund
All it will take to cause the second part of the recession is a crisis between Iran and Israel (which is coming real soon).
I was unaware that the current depression was over.
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