Jim Rogers said in an interview Monday that he thinks silver will be a better investment than gold this year, as continued pressure to raise cash by large funds, central banks and possibly the International Monetary Fund (IMF) could continue to pressure the yellow metal down.
“Silver will do better than gold,” Rogers, chairman of Singapore-based Rogers Holdings, said on Monday in an interview. “It’s been beaten down horribly. If you put a gun to my head and said you have to buy one, I would buy silver rather than gold.”
While the IMF has agreed to a plan to sell gold in May, it still has to gain legislative approval from member countries to go ahead with sales. To reduce a budget deficit, the IMF will sell 403.3 metric tons of gold if approved.
Although he believes silver will outperform gold, he said if gold continues to have downward pressure, he will start buying into it again.
He reiterated his assertions that the current commodity sell-off doesn't represent the underlying fundamentals, and they'll come back much higher.
Inflation and the ability to meet surging demand will push metal, energy and agricultural prices higher, said Rogers.
The emerging Chinese middle class pretty much guarantees this will happen, and once commodities begin their rebound, the commodity bull market will continue on and last longer than projected because of this temporary slowdown.
It'll be interesting to see whether silver indeed does surpass gold in 2009 in the commodity sector.
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