Rogers: My view of the world as we enter 2012

Ever since outspoken investment veteran Jim Rogers predicted the commodities rally in 1999, his comments have been closely followed by investors worldwide.

Here he shares his latest views exclusively with Investment Week.

On safe havens in general

“I have never heard of a safe haven as in the investment world there is no such thing as safe.

Even if you own cash, the question is what kind of cash? If you owned Icelandic króna two or three years ago you might have thought you were sitting pretty. You would be holding cash and earning high interest at the same time. You would have gone bankrupt.”

On foreseeing a gold correction

“It has been correcting for the past three months so it is overdue for a stronger correction, but I have no idea by how much. It is very unusual for any asset to go up for 11 years in a row with no correction. I own gold and I am not selling my gold.

The price at which I buy will depend on the circumstances. If it is going down because the world is going bankrupt then it would need to be priced at $900 for me to buy it. If there is an artificial occurrence then maybe between $1,200 and $1,400. It depends on what is going on in the world.”

On currencies

“I do not know for how long the US dollar will go up but I do own it at the moment though I am pessimistic long term. I am not sure whether I will own it in a week or year. If it goes down I might buy more.

“A year ago everybody was pessimistic about the dollar including me. When everybody is on the same side of the boat, you go to the other side of the boat for a while. 

“I own the Chinese renminbi, the Japanese yen and the Swiss franc. I have held these for a long time and have no intention to sell out.”

On Japan

Rogers sees Japanese stocks as “very cheap” and forecasts Japanese domestic investors will incur losses overseas and repatriate funds into local equities.

“They will soon start losing on the money invested abroad so a massive amount of that money is going to come back home. I doubt that will go into bank deposits or bonds because interest rates are so low. Then at least they can go to commodities or stocks.”

Rogers owns shares in Sanrio, the Hello Kitty brand licenser, and Japanese toy manufacturer Tomy.

On Fitch downgrade of US economic outlook

“Where have they been for the past six years? The US is the largest indebted nation in the history of the world. It has nowhere near AAA status.”

Government bonds

“I do not hold any government bonds anywhere in the world. I am unlikely to buy into them unless there was some kind of special situation.”