When the only response to every financial issue is to print more money, the ultimate conclusion is certain. In between it will get nasty.
Jim Rogers’ Warning: Riots Coming To America
Dominique de Kevelioc de Bailleul: Speaking with the Wall Street Journal on Friday, commodities trader Jim Rogers of Rogers Holdings said riots such as the ones witnessed in Greece and reported as widespread in China will hit the United States and again in Europe as the next leg down in the financial crisis takes shape (after the election, he speculates in previous interviews).
“I’m more worried about those kind of problems [rioting] in the U.S. and Europe; this is where social unrest is going to be worse,” Rogers told the Journal. “I would suspect that, when economic conditions get worse here and get worse in Europe, we’re going to see . . . you’ve seen governments fail in Europe; you’ve seen countries fail in Europe. I suspect you’re going to see more of it [rioting], yes.
“We saw it in London; we’ve seen it in several countries in Europe in the last year or two. Yes, I expect to see it here, too. If you don’t, look out your window”“Nationalism will emerge. Healthier countries will not see fit to spend their hard earned money to bail out their less responsible neighbors.”
When asked about Bernanke’s credibility regarding his latest FOMC public statement, in which he said the Fed will be able to contain inflation, Rogers became noticeably irritated.
“Mr. Bernanke has zero credibility as far as I’m concerned. The Federal Reserve
has zero credibility,” Rogers said forcefully. “Simon, go back at everything Mr. Bernanke has said in the last seven or eight years he’s been in Washington. He’s never been right about anything. The man has zero credibility for anyone who would take the time to look at his history.”
As far as further inflation down the road, Rogers stated inflation is already in the pipeline, and will manifest in higher commodities and consumer prices—of which, historically, have lagged money supply expansion by six months to one year.
As of the week ending Apr. 25, 2012, the Fed reported its balance sheet reached a total of $2.92 trillion, up from $2.71 trillion a year ago, and up from $920 billion in March 2008—well before the brunt of the financial crisis took its toll on markets later in 2008 and early 2009.
A tripling of the Fed’s balance sheet within fours years won’t be the extent of the damage to the Fed’s debt monetizing scheme and the value of the U.S. dollar, according to Rogers, who sees much more Fed money printing to come as well as consumer price inflation as a result.
“Absolutely, they’ve been printing staggering amounts of money; they’ve been taking staggering amounts of debt onto their balance sheet, much of it is garbage,” said Rogers. “The federal government is spending huge amounts of money they have. We have inflation in the U.S., and it’s going to get worse, Simon.”
Rogers said investors have it easier today than prior to the crisis. It’s a heads-you-win, tails-you-win scenario. The emergence of Asia as a source of consumption of raw materials and finished goods will exact pressure on harder-to-find natural resources. If demand is crippled by the financial crisis, however, central banks will respond by debasing their respective currencies, forcing smart money into ‘things’ as a means of protecting wealth.
“In times of inflation . . . that’s put it this way, if the economy gets better there will be shortages of those raw materials and I’m going to make money,” Rogers explained. “If the economy doesn’t get better Simon, they’re going to print a lot more money. Mr. Bernanke doesn’t know anything else but to print money. And throughout history when governments debase the currency, you protect yourself by owning real assets, whether it’s silver or rice, or whatever it happens to be.” [Emphasis added]
Rogers’ take on the most popular asset class among investors who follow the American expat who now lives in Singapore—gold—is that, he holds the precious metal (and by extension, silver) as a reliable means of storing value during a globally coordinated money-printing policies executed among the world’s major central banks. He also discusses the virtues of owning oil as a play on ‘Peak Oil’ in addition to currency debasements.
“I own both [gold and oil] of them,” Rogers said. “Gold has been up 11 years in a row which is extremely unusual for any asset. It’s consolidating; it wouldn’t surprise me if it continued to consolidate. If it goes down a lot more, I hope I buy a lot more. I’m not selling my gold by any stretch of the imagination.”
Rogers added about oil, “The surprise with oil is going to be how high it stays and how high it goes. Simon, the International Energy Agency (IEA) has done a study. The world’s known reserves of oil are in steady decline. We have to find a lot of oil or the price of oil is going to unheard of heights.”
Nonanonymous says:
Riots are coming to America, and a police state. Quite ironic, considering the revolutionary war was fought as a response to imperial tyranny.
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4th May 2012 at 10:52 am
randy says:
Inflation, as a result of the Federal Reserve, and all other government, is in trickle down mode.
As the Fed increases digital moeny supply, it releases it to member banks. Banks have tightened lending rules, thus restricting one outlet of that digital welfare payment.
So, more digital money is dedicated to other money making plays.
With real estate dead, sovereign bonds risky, digital money has gone into derivatives, cds, etfs, and stocks.
As long as financial markets hold this money out of the hands of main street, inflation is held back. Not entirely, and nor is it mild inflation, but it is not hyperinflation.
This digital money is being held to prop up a pension and entitlement system that, if collapsed, would result in the US, and the world, entering another dark age.
As long as the rich stay rich, and keep getting richer, it is cheaper to increase entitlement than it is to reset the system after the real estate bust.
Demographics point to a long and steady decline in real estate needs. The next generation is smaller, energy prices are higher, and the demand for overbuilt 3 square foot houses will never increase.
Lets just hope they keep us feed, our cable and internet on…
peace…
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4th May 2012 at 11:18 am
randy says:
3000 sq ft houses…
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4th May 2012 at 11:19 am
Administrator says:
Inflation is in trickle down mode. If measured exactly as it was measured in 1980, inflation is currently in excess of 10%.
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4th May 2012 at 11:32 am
Administrator says:
The next generation is smaller? Have you gotten one fact right since you’ve graced my site with your wisdom?
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4th May 2012 at 11:34 am
Maddie's Mom says:
His interviews are always a fun time.
I think he’s been hangin’ out with Celente.
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4th May 2012 at 12:10 pm
flash says:
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4th May 2012 at 12:26 pm
randy says:
Yep, I’ve got at least one fact right.
Governments and central banks around the world are “printing” money, and there’s nothing we can do about it…
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4th May 2012 at 12:38 pm
Hope@ZeroKelvin says:
@flash: I LOVE THAT PIX! Did you make that just for me???? Thank you!!! I am going to steal it.
My phrase and that pix are a great pairing as I think that painting just sold for $120 MILLION at auction recently. So, here, in the midst of economic collapse for most people, some guy has that kind of cash to blow, astounding, ****eyeballs rolling outta my head****.
It also would make a great backing for TBP T shirt.
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4th May 2012 at 12:44 pm
Thinker says:
Interesting story I had to share. Late Boomer/Prophet gen, which becomes obvious, but raising some important questions and offering insights into how life will be for most people following the crash.
Can Going Without Money Hurt the Economy? One Man’s Quest to Be Penniless
Daniel Suelo is 51 years old and broke. Happily broke. Consciously, deliberately, blessedly broke.
Not only does he not have debt, a mortgage or rent, he does not earn a salary. Nor does he buy food or clothes, or own any product with a lower case “i” before it. Home is a cave on public land outside Moab, Utah. He scavenges for food from the garbage or off the land (fried grasshoppers, anyone?). He has been known to carve up and boil fresh road kill. He bathes, without soap, in the creek.
In the fall of 2000, Suelo (who changed his name from Shellabarger), decided to stop using money altogether. That meant no “conscious barter,” food stamps or other government handouts. His mission was to “use only what is freely given or discarded and what is already present and already running,” he wrote on his web site, Zero Currency.
The question many people wonder: Is he insane, or a mooch, or simply dedicated to leading a simple, honest, dare we say, Christ-like existence?
They’re good questions. And depending whom you ask, the answers vary.
Suelo wasn’t always a modern-day caveman. He went to the University of Colorado and studied anthropology, at one point considering medical school. He lived in a real house, with four walls, a window and a door, and shopped in stores, not their dumpsters.
But over time he says he grew depressed, clinically depressed, mainly with the focus on acquisition. “Every time I made a resume for a job, signed my name to a document, opened a bank account, or even bought a banana at the supermarket, I felt a tinge of dishonesty,” he said.
He was born into an Evangelical Christian home in Grand Junction, Colo., and took his religion seriously. Eventually, he started wondering why “professed Christians rarely followed the teachings of Jesus–namely the Sermon on the Mount, namely giving up possessions, living beyond credit and debt–freely giving and freely taking–giving, expecting nothing in return, forgiving all debts, owing nobody a thing, living beyond payback of either evil-for-evil or good-for-good, living and walking without guilt (debt), without grudge (debt), without judgment (credit & debt), living by Grace, by Gratis, not by our own works but by the works of the true Nature flowing through,” he said.
Although he considered himself a Christian, he discovered that the same principles applied to Taoism, Judaism, Hinduism, Buddhism, Jainism, Sikhism, Islam, Mormonism, Shamanism, and Paganism.
One year he went to Alaska and worked on the docks. But that, too, he says, felt dishonest. Instead, he and a buddy decided to live off the land—spearing fish, foraging for mushrooms and berries. (Think Castaway, but with snow). Suelo (which means soil in Spanish) eventually hitch-hiked back to Moab with $50 in his pocket. By the time he arrived, his stash had dwindled to $25. He realized that he only needed money for things he really didn’t need, like snacks and booze.
He began toying with the idea of living full-time without money. He traveled to India, and became fascinated by Hindu Sadhus, who wandered without lucre and possessions. He considered joining them, but then he realized that “A true test of faith would be to return to one of the most materialistic, money-worshipping nations on earth, to return to the authenticity profound principles of spirituality hidden beneath our own religion of hypocrisy, and be a Sadhu there,” he said. “To be a vagabond, a bum, and make an art of it – this idea enchanted me.”
And soon, that’s exactly what he did. He says he left his life savings—a whopping $30—in a phone booth, and walked away.
But he didn’t do it in a vacuum; he maintained his blog for free from the Moab public library. Rather than just sitting on a mountain and gazing at his navel, he wanted to have an impact on others, to spread his gospel.
In 2009, Mark Sundeen, an old acquaintance he’d worked with at a Moab restaurant, heard about Suelo through mutual friends. At first, “I thought he must have lost his mind,” Sundeen, 42, said in a telephone conversation. But then he began reading his blog, and grew intrigued. Sundeen divides his time between Missoula, Mont., and Moab, where he was once a river guide, and he paid a visit to Suelo’s cave.
Gradually, he said he realized that much of what Suelo was saying made a whole lot of sense. This was right around the time the economy crashed, and “It felt like a lot of what he was saying was prophetic,” said Sundeen. “That money is an illusion, an addiction. That resonated with me after the collapse for the economy.”
Sundeen was so intrigued that he decided to write a book about Suelo, The Man Who Quit Money, which was published in March.
While the book reviews have been generally positive, Suelo has come under fire by some who say he’s a mooch, or a derelict, sponging off society without contributing. They are valid criticisms: This is a guy, after all, who’s gotten arrested for train hopping, (what would Jesus say about that?). And he’s not opposed to house sitting in winter–not exactly living off the land.
And besides: How is he actually helping others by going without? It’s not like he’s solving world hunger, or curing cancer.
Sundeen disputes these arguments. “He doesn’t accept any government programs—welfare, food stamps, Medicare,” he said. “The only ways in which he actually uses taxpayer funded derivatives is walking on roads and using the public library. So in that regard he’s a mooch–he’s using the roads and not paying taxes. But if you try to quantify the amount of money he’s taking from the system—it’s a couple of dollars a year, less than anyone’s ever used.”
Instead, he is actively promoting “his idea that money is an illusion,” Sundeen said. “The Fed just prints it up, it doesn’t mean anything and it’s going to lead us down the road to serfdom.” Suelo simply doesn’t want to contribute to that, and so he lives life on his own terms.
That said, Sundeen wouldn’t live the way Suelo does. “The appeal to me is the living outdoors part, but I feel like I got my feel of that working as an Outward Bound guide,” he said. “At this point I have other priorities.”
Suelo, for his part, has no plans to bring money back into his life. “I know it’s possible to live without money,” he said. “Abundantly.”
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4th May 2012 at 12:57 pm
sensetti says:
Flash there’s that riot thing again, riots and fire go together for some reason. When the free shit army faucet gets turned off the zombies will go ape shit.
I don’t think I will be moving to town
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4th May 2012 at 1:03 pm
Stan says:
I think it’s time to get any money you have out of banks while you still can. Soon it may be too late
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4th May 2012 at 2:34 pm
randy says:
Hope@ZeroKelvin says:
@flash: I LOVE THAT PIX! Did you make that just for me???? Thank you!!! I am going to steal it.
Yes. indeed. I should have included credit to you for coining the phrase..
BTW. Munch’s scream has been a favorite since grammar school.
When I heard it was to go to auction,I almost proposed a joint venture on TBP to buy it…LOL..admin woulda’ probably chunked in 3/4s..
this may be a bigger version…or not..
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4th May 2012 at 2:40 pm
flash says:
sorry randy..
Two pics…damn …double exposure I guess?
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4th May 2012 at 2:41 pm
Muck About says:
@thinker: Interesting story. It would take someone who is ground down to the very basics of survival (which we may all be, one day, real soon now) to exist in that fashion. I personally couldn’t/wouldn’t do it because it seems a bit aimless to me. Doing it because you have to is one thing, doing it as a belief system is another.
Of course, when TSHTF, it won’t effect his standard of living much at all except he’ll have more competition in the dumpsters and gathering roadkill. And the library may be burned down..
MA
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4th May 2012 at 2:51 pm
flash says:
sensetti
Having spent considerable time in both the country and inner city, I can tell you with great certainty that country folk have absolutely no clue what the city bred dog eat dog genre are capable of and the speed with which they can achieve it.
They are organized and think as a pack. They stake their territory like a pack of wolves and protect it at any cost.
Research in psychology shows that kids who grew up in violent enviros recognize potential danger in body language and facial expressions quick ,because they’ve been dodging the shit their entire live and kids raised in loving , nurturing homes do not .
I’ve seen this play out up close and personal.
Very few people will fight, most will run …don’t bet your ass on someone that’s never taken a mofo down personally.
Sure, it looks good on tv , but it’s another ball of snot teeth and shit in real life.
And, city folks been practicing tit for tat shit a long time.
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4th May 2012 at 3:24 pm
Mike says:
Jim Rogers has such a pleasant way of presenting things. He’s the wise uncle I never had.
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4th May 2012 at 3:26 pm
flash says:
Thinker
He quite money , but money didn’t quit him.
He eats , stays warm,dry and clothed.
And, besides using money funded services like roads and free wifi , if in need of medical care he visits an emergency room funded by someones’ money.
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4th May 2012 at 3:34 pm
flash says:
“He quite money”
G’damn auto correct..
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4th May 2012 at 5:05 pm
ThePessimisticChemist says:
There are people out there who truly live off the grid, and off of the system. This guy is not one of those people.
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4th May 2012 at 5:06 pm
Jackson, who's relying on the State for stability says:
Don’t worry about riots coming to America. The police and the military will keep order. With surveillance cameras, SWAT teams, and overwhelming firepower, the State will keep any unrest in control. When you hear about riots and disorder, remember Kent State and Waco. The elite wants stabilty and will have it. Forget Jim Rogers: don’t worry, be happy.
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4th May 2012 at 8:50 pm
Ron says:
Get away from big citys,HOA’S and dept.Figure on a future with no support from government.Or things you take for granted right now.
Small towns are good,i helped someone out today and used their car,it needed gas so i went to the station and told them what was going on so they let me fill it up and he well pay them next week.
Church and knowing people.
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4th May 2012 at 3:00 am