Jim Rogers Sees Worse Recession in 2013-2014,
Says Fed Already Printing More Money
global investor and chairman of Singapore-based Rogers Holdings,
Jim Rogers reckons the Fed finds it embarrassing to announce QE3
as all previous attempts have failed, but says the central bank
is already printing more money. He predicts another recession: "You
should be very worried about 2013-2014."
Now on Monday, Rogers said: "I do not know if they will
announce it. I know they are going to print more money. They already
look at their balance sheets, you will see that something is happening,
assets are building on their balance sheets," he explains,
adding that these "are not coming from the tooth fairy."
So, what could
the Fed's reasons be for not yet announcing QE3? "Egg on their
face," according to the famed investor.
are a little bit embarrassed because they announced QE1 and QE2,
and it did not work. So they may try to discuss it. They may just
continue to do it without getting egg on their face again, but they
are going to print money," Rogers told ET Now. "This is
all they know to do," he added.
In his widely
anticipated speech at Jackson Hole last week, Fed Chairman Ben Bernanke
said the U.S. economy was "far from satisfactory" and
used the forum to defend unorthodox policies such as bond purchases.
Bernanke also made the case for further action to reduce an unemployment
rate that he called a grave concern.
that four Fed presidents have come out in favor of an open-ended
strategy for bond buying, with three calling for the program to
begin now. "Rather than specify a fixed amount of bonds to
purchase by a certain date, such a strategy would leave the Fed
able to announce a pace of purchases that it could adjust as the
economy gets closer to Bernankes goals."
truth," counters Peter Schiff, CEO & Chief Global Strategist
at Euro Pacific Capital, "is that our economy has a disease
that all the quantitative easing in the world can't cure. And while
the wrong medicine may make us appear healthier in the short term,
we will continue to deteriorate beneath the surface."
the Fed has kept interest rates too low for too long, Americans
have saved too little and borrowed too much; consumed too much and
produced too little; and imported too much and exported too little.
Too much of our labor is devoted to the service sectors and not
enough to goods production. Too much capital goes to Wall Street
speculators and not enough to Main Street entrepreneurs," Schiff
wrote in his economic commentary
As to Europe,
"there are going to be more problems as nobody is dealing with
the problems," reckons Rogers.
to too much debt is not more debt. So now you are going to have
plenty more problems coming out of Europe, he told ET Now.
Central Bank unveiled Thursday a fresh program to buy bonds issued
by heavily indebted eurozone countries, under strict conditions,
in a widely-anticipated bid to save the euro.
Mario Draghi unveiled a new central bank instrument known as Outright
Monetary Transactions (OMTs) in secondary markets for sovereign
bonds, but stressed that governments would also have to fulfill
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Rogers has taught finance at Columbia University's business school
and is a media commentator worldwide. He is the author of Adventure
Gift to My Children, and A
Bull in China. See his
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