Commodity investors must have long term outlook says Jim Rogers
Jim Rogers has been known for saying he's the worst trader there is, and a terrible market timer.
The reason behind why he says it? We shouldn't think of ourselves or act like traders or market timers. History has proven that buying at low prices and holding on for the long haul far outperforms trying to time or trade the markets.
Warren Buffett of course also holds to and lives by this financial philosophy.
Now as far as the worldwide financial crisis, Rogers asserts that it's far from over yet, and by the time it's through, it'll be the worst economic crisis since World War II. The reasons why are the extraordinary excesses that created the crisis in the first place.
He adds that the government is making the usual mistake of interfering, and like the Great Depression in the United States, it'll make things worse, and elongate the pain.
Those who understand or have studied the Great Depression, know that there wouldn't have been one if the government hadn't interfered, as it prolonged it for many years, instead of the short time it would have worked itself out.
This happens because governments can't resist the temptation to make themselves look like saviors to the people, making it look like they're taking steps to alleviate their pain. The truth is the government causes much more pain, and this will happen again with the most recent, misguided bailout offered.
What underlies the mistake is the assumption the government should keep people from experiencing any pain. That's as stupid as those people who spoil and, in reality, abuse their children by keeping them from all difficulties in life.
As for Rogers, he continues to reiterate his commitment to investing primarily in agriculture, as he sees a growing demand that will continue to be a challenge to meet.
Concerning individual investors, Rogers adds that they should invest in sectors or companies they have a solid knowledge of. Nobody will know about them better than you if you do your homework.
The most successful commodities investors will continue to be those that do it with the long term in mind.
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