Jim Rogers gives the best investing advice you’ll hear, talks next big market crash

is this the worst financial crash that we've seen in the lifetimes and where can we go from here joining me today is a very special guest legendary investor jim rogers co-founder of the quantum fund jim it's such an honor to finally have the chance to speak with you you're joining us all the way from singapore welcome back to kitcov david it is my honor my pleasure i am a fan of kitko and we are a fan of you jim many many people around the world are a fan of you jim i want to i want to share uh this quote that i found with you in 1930 gdp fell by 8.5 we call that a depression in 2009 rio gdp contracted by two and a half percent we call that a recession this year annualized gdp contracted by 33 percent what would you call that i wouldn't call it good i would call it a disaster i would call it the worst economic times in my lifetime and you've you've been um you've been on the show for many times and you've been talking about the coming crash that is the worst in your lifetime is this it jim is this the worst that you've been predicting well this certainly has been the worst in my lifetime we've had a huge rally because governments everywhere have printed and spent staggering amounts of money but david it just means the next time it's going to be worse still you know unless you think we'll never have economic problems and market problems again the next one's going to be worse because the debt david in 2008 we had a problem because of debt since then the debt has skyrocketed skyrocketed everywhere in the world so unless you think we're not ever going to have problems again then the next one's going to be worse unless you know something i don't know how can we possibly see a worse situation from what we're seeing today record levels of unemployment our record levels of economic contraction basically a comatose environment for the macro landscape all over the world how can things possibly get worse jim well david i suggest you read a little history and you will find it can get worse people say it cannot get it can get worse throughout history you know go back into the 19th century we just use america alone we've had some staggering staggering economic difficulties at times but europe too some of the largest banks in the world went bankrupt in previous economic hard times companies that people never thought could go bankrupt collapsed don't think it cannot happen it has happened and it will happen again the equities markets certainly seem to have shrugged this off if you just look at it without any context we've seen new all-time highs in the nasdaq the s p 500 is more or less returned to pre-covert levels why are we so disconnected from reality in the stock markets jim david six months ago the united states i'll use the us again with the largest debtor nation in the history of the world never had anybody been so deep in debt david since then the u.s has increased its debt by trillions with a t trillions more you know if you give me a few trillion dollars i will show you a very very good time we will all have a wonderful time with a few trillion dollars but david somebody eventually has to pay the price because somebody has to worry about paying it back you know david is it is these days are not good for old people they are not at all good for young people even you i mean you're not old you're not too young i have young children oh my gosh america's leaving them a terrible terrible legacy which they're going to struggle with all their lives you know but right now there's an election in november everybody wants to be re-elected so they're doing everything they can to be re-elected but it is leaving a very very bad aftertaste there's a theory jim that the federal reserve can pay off these debts like you talked about by printing more money and so the circle continues what do you think about that can they do that that's probably what will wind up happening it was often happened in history at the moment first of all whenever there's a problem in the world people look around for an easy way to solve the problem once upon a time there was a guy named marx mr marx mr marx had a wonderful theory and many people accepted it and tried it for a long time nobody believes in mr marx anymore we found that it didn't work but right now there's another one called more money today mmt give me some money more money free money well everybody loves it so everybody many people are starting to try it the br nobody's saying it out loud but the british are doing it some people china the japanese are doing them so this is going we're going to find easy ways politicians always find easy ways will it work in the long term as i said david being a young person in america right now is not a good thing to be let's just go back uh one question here you were talking about the next time a major economic collapse could happen this year we saw kova being the trigger now obviously nobody predicted covet it's a black swan event the next time this could happen the next time our dead bubble gets popped jim what could be the trigger is it war is it anything else that you've that you've been looking at well it's usually something we're not looking at you know it's usually some small company or small country it gets into trouble and then things start snowballing you know even if you go back a few months december in japan markets in some parts of the world were already starting to have problems and then along came the virus and popped the bubble um it usually works that well usually we don't have a worldwide epidemic but well actually i take that back we have had worldwide epidemics before but never before have politicians reacted the wrong way you know in 2009 david we had the h1n1 virus in america well they didn't close mcdonald's they didn't close the airports this time for whatever reason politicians and academics and and journalists seem to have overreacted and said we have to close the whole world we've had many epidemics never before have we closed the whole world so in my view they made mistakes and that's what has made this so horrible but we had a lot of debt as well and so now we have more debt and next time around that huge debt is going to leave us all with worse problems a lot of people draw similarities between today's situation in 2009 one of the major differences that you might have observed is that we've had no major financial institutions collapse why do you think this is david the printing presses are running at unbelievable speed every day the bank of japan goes to work and cranks up the printing presses and as he said we will print unlimited that's his word unlimited amounts of money that's happening all over the world i mean if you get into trouble you just call up and say help me help me help me save me and somebody comes along and saves you no we haven't had any gigantic problems yet but the debt is building up everywhere maybe i'm wrong david maybe this time is different maybe the world has learned the solution so that it is different this time but i doubt it have you ever have you observed a major capital flows going out of the united states well at the moment the u.s dollar is going down so that means somebody's selling it but most countries in the world i i anyway you know i wonder all the time about where to put my money um and i don't find any place that's really a great alternative to the us dollar at the moment the pound sterling forget it the euro maybe temporarily the chinese currency yeah but it's it's blocked so you can't do a lot there japan but yeah but they have huge problems in japan so david the answer to your question is i am looking every day for the place to put my money i have not found a suitable long-term place yet i own a lot of u.s dollars but i not because it's sound i own it because during turmoil people look for a safe haven because of history people think the us dollar is a safe haven so i own him but david is going to get overpriced before this is over then i'll have to sell it could turn into a bubble i'll certainly have to sell it if it turns into a bubble but not yet i mean yeah some money is leaving but not huge amounts yet and you don't think that the us dollar can become or maintain a safe haven status in the future well yes for a while as i said as the turmoil gets worse as the bear market worldwide gets worse in the next i don't know when a few months from now more money is going to go into the dollar you don't want to put your money in euros you don't want to put your money in sterling or pound sterling none of these things are i mean they're all less good at least people think than the dollar and so on money will flow back into the us dollar and it will get overpriced if you know a currency that is sound and stable and will survive all of this please do not say it out loud please send me a private email because i'm looking for that currency i think i think some uh some economists would say that that currency would be gold would you agree with that uh gold is not a currency uh i know that there are people who think it is it's certainly a kid co but you cannot walk into mcdonald's and buy a hamburger with gold you cannot walk into ginsa in tokyo and buy you know unagi with gold so yes i know that yes yes i know about gold i won't go for many years decades gold is not a currency now if you want to use it go down to the shop and try to buy some bread yeah now we're living in really unprecedented times we're seeing negative real interest rate environments not just in the us but in europe as well as everybody rushes to the bottom what do you think is going to happen to the monetary system well we always look for easy solutions when things get bad again read history it always happens people look for something they will make life easier uh and they try it they try if they if there's a if there's a theory lying around they say oh let's try that let's try that for a while that's what more money today will be mmt they will try that but in the end you cannot everybody cannot just print money or let's put it this way never in history has that worked in the long term it may work in the short term but it if it works eventually all currencies are debased and people have to look for something stable now back to gold and silver throughout history people like me have always turned to gold and silver in times like this i mean you weren't asking about gold head but david the politicians and the academics and the bureaucrats tell you gold is not worth it do not gold is a barbarous relic that's what they call it maybe but peasants like me peasants like me throughout history know that gold and silver okay it may be a barbarous relic but i'm going to own it why do you think there's such a political incentive and this is not the first time i've heard uh heard someone say this but why do you think there's such a political incentive for uh for the governments to to keep a distance from gold why you know why why would why would they want to subdue the populace from owning gold well historically it was because gold was money and was in the money system that's why in the 30s america confiscated everybody's gold and made it illegal and the british and other people as well it was the money system it's not now but still it is a way where politicians will lose control i mean in 1971 richard nixon said we have to stop using gold and he did because there was they were losing control and politicians don't like to lose control and so they gold is the obvious place where peasants like me will go in in bad times and i'm not the only peasant when things get really rough they're going to be millions trillions of hundreds of millions of peasants like me and so they will have to try to do something gold's at two thousand dollars an ounce now this year broke record highs we've seen a lot more interest from the retail investment space into the precious metal sector whereas before you know young people like myself for example uh have shown a lot more interest in gold whereas before they haven't really cared why the rush now why the gold rush now is it because of the virus well david you should watch kitko news because everywhere printing money you know printing and borrowing staggering amounts of money i'm not all of us peasants know we may not have studied economics at an ivy league university but we know that when you print money and borrow money subconsciously we know this leads to problems and so more and more of us are turning to gold and silver it's not just retail investors warren buffett recently just purchased uh barrick gold shares is he late to the party well i doubt it if i'm right gold is going to go much much much higher before this is over gold may well it'll certainly get overpriced it may well turn into a bubble i hope it doesn't because if it turns into a bubble i'll have to sell it i never want to sell my i want my children to have my gold and silver someday but david as i said watch kitko news you will see that the world is really doing strange unusual things never before in the history of the world have interest rates been negative never and before has a major bank like the bank of japan said we will print unlimited amounts of money sure zimbabwe prints unlimited amounts of money countries have done it but now you have major people doing it so yeah this could turn into a huge bubble and go silver could go much much higher i expect them to go much much higher before this is over i actually uh we had we had jim rickards in the show recently and he mentioned you he said that he spoke to you a few years ago at a conference and he he asked you what you think about gold prices and you had said that gold's going to the moon but nothing goes up in a straight line have we already seen the major retracement that you would have expected oh yes yes what i said to jim was usually when something has a bubble like in a semi bubble like it gold did in 2011 and then it pops and corrects by 50 and that's just the way markets work i wasn't talking about gold i was just on my markets when i said that we certainly had the major correction i thought it might be a little more but i'm not good at market timing so no we've had that correction doesn't mean we won't have more corrections i mean gold would all markets have corrections but i'm i've been a buyer of gold since the summer of 2019 and i continue to buy the uh the elections are coming up jim and you've obviously been following what's going on here biden is leading the polls right now and uh some analysts expect him to win should the democrats take over do you expect a reversal in many of the pro-business policies that trump have implemented like tax cuts for example what would happen to the markets then well it depends on what happens in congress if the democrats when the when congress and the presidency yes i'm sure the markets will be unhappy certainly the u.s stock market will be unhappy the u.s stock market's at all-time highs as we speak there are bubbles developing or at least semi-bubbles developing in the u.s stock market so if it continues up and then biden wins i suspect we'll have a a very difficult time in 2021. do you think there's a certain candidate that would probably uh do better in inheriting this coronavirus pandemic crisis that we're seeing right now a better candidate yeah between trump or biden you know who would probably precise who exercised better over the none of the above you know we should have a line on the u.s ballot that says a b c none of the above send us somebody else well i think that's why the um absentee rate is quite high um finally jim i want to just pick your brain on your investment style because there's so many uh people around the world who look up to you and look at your track record and think gee how i would how i would like to be jim rogers one day um the quantum fund has returned 4 200 since uh 1970 to the 80s and uh during that decade you've outperformed the s p 500 which is only grown by 47 during the period how did you do it well we loved what we did uh we spent all of our time thinking about the market um and we both loved it and we've stayed with what we knew that you want to know how to be a successful investor the answer is stay with what you know don't listen to me don't listen to kid co well you can listen to kitko don't listen to tv people internet people just stay with what you know david if i told you you can only have 20 investments in your life you would be very careful you wouldn't be jumping in and out listening to hot tips every day every month you would stay with what you know and you would become a successful investor everybody watching this knows a lot about something whether it's fashion or cars or sports or something when you see something that you know is going to be successful and exciting don't just say oh that's going to be great don't tell all you then you go and you do your research and you figure out how to and if you should invest and how to invest and then you invest you will know it long before i will long before other people in the investment community you will also know when to sell because you will know when something's going to change again nobody likes to hear it david everybody wants a hot tip everybody wants to be rich this month well the second advice is don't listen to hot tips i stay away from hot tips yeah so just stay with what you know it's boring and nobody wants to hear it but that's how you become successful you know in those days we get nothing but focus and concentrate and dig deep and dig deep and dig deep that's how you become successful do you think an investor at one point consciously picks a style let's say value versus growth for example or is it more that the style picks the investor meaning that eventually it conforms to her personality well that's a good question but i think it's uh the question the answer that question is figure out what you yourself know best when i first started i had no clue i i once worked for a guy who was a genius trader i mean he he would he were about 50 or 100 stocks on the stock exchange he didn't know much about them i mean he knew ibm was a big company but he didn't know what they he knew very little but my god he could buy and sell it he once said to me there's a there's a block of 100 000 ibm for sale on the floor of the exchange go buy them for me at 90. i said what are you talking about how do you know you're just sitting there reading the newspaper i mean the tape was running by in those days they had the tape running by sure enough it was there i mean he was a genius short-term trader he never owned anything longer than a week or two but my god he was good but i am hopeless i'm the worst short-term traitor in the world in the world uh so everybody i didn't know that that people had different styles i didn't know that that wouldn't work for me but eventually i found by trial and error what i was less bad at but i was reasonably good at and so i found my way i know i'm a terrible short-term trader well i don't even try it anymore i didn't know it then but i found out and whether the style picks you or you picked the style for me it was trial and error i think what separates you from a lot of investors is that like you said you're not a short-term trader you're you pick things for the long term and you're good at it you've been good at it and a lot of people are wondering especially in this environment how do i weed out the bad investments for example if i give you a company any company and i ask you just look at the three statements income cash flow balance sheet what are the red signs red flags that you would pick up on and say hey this company is not going to survive the next crash like you said there's another crash coming well first of all you just said something very important you looked at all of those things the income statement with the balance sheet etc you know i found david early on that if you read the annual report you do more than 90 of the people on wall street if you read the notes to the annual report you do more than 98 of the people investing so back to what i said before do your homework this is not easy everybody looks on tv and they say i could i could have bought apple 30 years ago i could have done that well maybe they could have but they didn't because it's not easy so you have to do your homework you have to research you have to do the balance sheet you have to understand the numbers uh how do i do it i don't by now i've done it you know 100 thousands of times so i have a little bit of experience i have a little bit of self-knowledge and experience and so i look at things that i maybe didn't know about before but i used to be a professor and i explained it and you have to understand the numbers first of all but then you have to understand the competition you have to understand everything this is not easy i wish it were one of the things that i have learned about me is if something is really high and popular i usually don't bother with it unless it's obviously a bubble and then i'm i will look at it to sell short but mainly i look at things that are ignored hated you know i want something that if it's hated and ignored it's probably very cheap that does not mean i will buy you have to find something that's hated and cheap and then you have to find a change taking place for many decades i was anti-russia and soviet union i've never only time i ever invested in russia was i was short of the ruble once but then in recent years i have come to realize my god this place is hated very cheap low debt and i thought i perceived a change taking place in the kremlin and that's the second word you need to understand cheap and a positive change so if you can find something that's cheap and a positive change you're probably going to get very rich jim i have one last question for you uh we have quite a few number of uh younger viewers in our program right now myself i just turned 30 and i know you made your first million in your 30s so let's say today you were 30 years old what would you do what would you do differently with your money would you have invested any differently today well when i was 30 i was in i was on a roll i mean you said we made 4200 in 10 years when the market made i wouldn't do anything different i found my niche i found what i loved i found what i was good at so my answer to you is if you're looking figure out what you love the most whatever it is and if people laugh at you you're probably really right you're probably really doing the right thing just find your own passion and stay with it my passion was and still is but especially then my passion was the investment world all over the world it didn't matter we didn't know about countries we didn't have all these labels about value and blah blah we just found things that were cheap and bought them or found things that were expensive and sold i'm sure i love so if you can find your passion whatever it is that's what you should do ignore your friends if you say i want to be a gardener david everybody's going to laugh at you your parents are going to say david we didn't educate you to become a gardener your friends are going to say you hear about david he's a gardener your teachers are going to say david we educated you you do it you go and become a gardener because if you love you'll never go to work you'll wake up every day and have fun you will be the happiest person around uh it won't matter if you're successful because you're happy but you will be successful because those are the people are the most successful and someday when you have a chain of garden shops listed on the new york stock exchange your parents are going to call you and say oh david you remember how we used to give you seeds when you were a child we knew you would be a good gardener someday the professors are going to call and say david we knew it we helped you give us a building your friends are going to call and say david i see you're on the new york stock exchange i need a job all those people laughed at you and ridiculed you before so david find your passion whatever it is and then do it to this you know that's all i did in those days i loved it so much i just loved it so much i couldn't wait i didn't like it when the market closed you know because it was harder to do research how did you how did you educate yourself you didn't go to business school you graduated from college and then you went straight into wall street working as a research assistant and you were thrown right into the fire how did you how did you educate yourself about finance investing and picking companies at first i thought everybody was smarter than me because they were older and and been around more experience than me then i found that most of them made many mistakes too i should stop listening to them and i started realizing that if i could find things that's when i started realizing any key for me was to find something cheap that was changing and i realized about the numbers and the balance sheets i told you before i realized that i was once working on reading an annual report and doing a spreadsheet an experienced guy walks in the room and said people still do that nobody looks at breast spreadsheets anymore laughed at me well i mean i was embarrassed but i kept doing it that was what i i loved and i by experience i learned that if i understood the numbers and i understood what was going on i was to be ahead be ahead of other people wasn't easy but it turned out i loved it and i loved to track down everything but it was purely by experience and learning that the more i knew about the companies the competition the numbers the more likely i was to be successful because i realized that nobody else was doing it and david after you have a few successes doing it your way then you realize hey i'm on to something but it wasn't because i realized i was on i realized because i loved it so much i love tracking down you know it's like going to work every day you were in a three-dimensional puzzle and every day they were changing the parts all day long all week long it was a fabulous it is a fabulous way to spend your time because it's a three-dimensional puzzle that is always changing my gosh it's fun jim i want to thank you so much for taking the time to speak with me today uh you've been such an inspiration to many generations of people interested in finance and and uh and investors alike so thank you again i appreciate it well david i don't i want to emphasize again it's not easy this is not an easy way to make money or to even make a living so you it takes a lot of work like most things in life okay so i guess yeah the other second answer is be sure to watch kid co thank you for the plug jim i hope to speak to you again soon best of health take care until the next time my pleasure david thank you and thank you for watching kiko news i'm david lynn stay tuned for much more you

Channel: Kitco NEWS

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Keywords: gold, silver, finance, news, investing, investing news, finance news, financial news, economy, precious metals, gold price, silver price, gold price today, jim rogers, quantum fund, investing advice, warren buffett, gold stocks, value investing, jim rogers 2020, jim rogers 2020 predictions, jim rogers gold, jim rogers interview, ECB, bank of japan, Federal Reserve, quantitative easing, money printing, MMT, monetary policy, macroeconomics, china vs us, biden vs trump, election

Id: nzE6ulj0vE8

Length: 31min 42sec (1902 seconds)

Published: Wed Aug 19 2020