Taps Coogan – July 2nd, 2020

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Legendary investor, author, and Chairman of Rogers’ Holdings, Jim Rogers, recently sat down with the Indian economic news outlet ET Now to discuss the emerging “mania” that he sees in stocks. Echoing sentiment that he has expressed for several years, Mr. Rogers warns that massive money printing and asset buying from central banks as well as massive borrowing and spending from governments is pushing certain stocks into a “mania”.

With regards to what’s pushing markets higher:

“The main thing that is going on in the world is that central banks all over the world are printing huge amounts of money and governments are borrowing and spending huge amounts of money. You know, everyday the Bank of Japan goes in there and starts printing money as fast as they can and buying stocks, buying bonds, buying ETFs. Somewhat the same is happening all over the world. In the US they’re not buying stocks… but they’re buying everything else…”

On the prospect for a blow-off top in markets:

“Often in history, after a long rise in a market it turns into a blow-off bubble, especially when there is a huge amount of money that suddenly comes in. I am not very good at market timing, but I suggest that we may have a blow-off, at least in the American stock market and maybe the Japanese stock market because of all this madness that’s going on…”

On the impact of a second wave of Coronavirus:

“Most governments will not close down a second time around. At least, they will not be as draconian as they were the first time around because they realize that the cure can be worse than the disease… you may see areas close down but the basic economic damage has been done… Countries now realize that they have to eat and they have to survive and closing everything down will not work.”

On US Tech giants:

“These things often end in blow-offs and that part of the market is already beginning to have its own blow-off. They go up almost everyday. The valuation is incomprehensible to those of us that are a little more conservative… This often winds up in a mania, a bubble, and that looks to be what’s forming in the US and some other place as well. Some Chinese stocks are the same way… some of these stocks just never go down…”

Why he is bullish on agriculture:

“Agriculture has been a disaster for 30 or 40 years. The average age of farmers in America is 58. In Japan it’s 66. More people commit suicide in agriculture in the UK than any other sector. More kids study public relations in America than study agriculture. It’s turning. It’s got to turn or we will not have any food or we’re not going to have any clothes… Maybe not. Maybe we will have a depression in agriculture for another 30 years. I suspect not… but my market timing is always bad…”

For what it’s worth, Mr. Rogers has maintained the aforementioned views for years and he’ll be the first person to admit that he isn’t good at market timing. Time will tell if the Coronavirus has ‘quickened’ any of these trends.

There is much more to the interview, so enjoy it above.

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