Jim Rogers, CEO of Rogers Holding performs an interview for Bloomberg on February 5, 2009.
I’m certainly not investing in Russia. The Russians have lots of deep seeded problems. there’s a good chance Russia will continue to disintegrate into more than one country.
The Soviet Union broke up into 15 countries. Russia itself has the potential to continue to break up. The Ukraine may break up. Khazikstan may break up. Whenever empires are disintegrated througout history the reverberations have gone on for a long, long time.
Mr. Rogers is making a bold prediction, but nothing that is out of the realm of possibility. In November of 2008 Russian professor Igor Panarin said something similar about the potential for the USA to fracture into six separate parts. To be honest, if i was forced to bet on which would disintegrate faster, I’d have to bet on the Reds.
Jim Rogers believes the Russian government is making the same mistakes as the USA and UK, by propping up failing banks at the detriment of those banks that made good decisions.
On what the Russians are doing right:
Putin at least seems to understand that there is a problem with the US Dollar and that the world needs to address that problem. He seems to understand some of the problems that face the world better than we do in America right now.
The Pound is finished… what about the Ruble:
The Russians have been stripping assets here for a long time. Oil production peaked. The production of most things have peaked in Russia for the foreseeable future. So no, I’m not buying the Ruble either.
The Russian government announced it would defend the Ruble at 41 against the Euro/Dollar basket. Was it a mistake for them to announce a target:
It always has been in the past. The markets have learned throughout the last few centuries that you can always bet against the Central Banks and you will make money eventually. so when a Central Bank says don’t worry ‘the pound is going to stay here’ or ‘the ruble is gong to stay here’, whatever, ultimately that has always failed if the fundamentals are not sound. And it will fail again and everybody knows what the target is.
On what is driving the fall of the Ruble:
It’s mainly the Russians. In fact, whenever a currency fails throughout history it’s always started internally. The foreigners always get the blame because the politicians like to blame all their problems on foreigners.
It always starts with the local people. Speculators have always joined in later.
On whether or not he is shorting the Ruble:
I’m not doing anything right now. But, knowing that the Central Bank has drawn a line in the sand, it makes me sit up and take a little more notice about the Ruble.
Jim Rogers On Oil:
The price of oil has to go much higher over the course of the next decade. Whether it’s going much higher this year or not, I don’t have a clue. But I do know over the next few years it’s going to go much higher.
On which countries will come out on top when the recession/depression is over:
The ones that are going to come out of this ahead are the well managed ones that have a lot of natural resources.
What’s happening now is good for the fundamentals of raw materials.
Fantastic 8 minute video and worth the watch: