In Times of 'Zombie Banks,' Buy
Commodities: Jim Rogers
| 22 Oct 2008 | 05:51 AM
The fundamentals for commodities were not affected by government
policies that are propagating inflation, Jim Rogers, CEO of Rogers
Holdings, told CNBC Wednesday.
"I bought more agriculture this week," Rogers
told "Squawk Box Europe." "What's happening is that there will
be less supply of everything if we ever come out of (the credit crunch). Nobody
can get a loan for a zinc mine or, long term, increase crop production."
If history is any guide, things
to buy are things that are doing fine right now like water treatment companies
in Asia or agriculture, Rogers added.
Treasury
Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke should resign
for keeping alive "zombie banks" that should be allowed to fail, he
said.
The Japanese government refused to let financial
institutions fail in the 1990s, Rogers said.
"It's 18 years later and
their stock market is 75 or 80 percent below what it was 18 years ago," he
added.
Rogers also said that
interest-rate cuts are coming.
"I know we are going to get
aggressive rate cuts everywhere, that's why I'm long short-term government
bonds in the U.S., but shorting long-term government bonds because it's not
going to help, it's going to add to inflation," he said.
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