Wednesday, August 25, 2010

Jim Rogers: “We never got out of the first recession”

In a telephone interview with Bloomberg, investor and author Jim Roger stated concerning the economic conditions, that “We never got out of the first recession," something we agree with heartily.

As we mention frequently, the GDP of the United States includes the stimulus spending in its results, and so makes things look better than they really are, masking the true state of the economy.

That's why most economic commentators continue to say we're in danger of a double-dip recession.

Stimulus money is leaving the economic system, simply revealing to us the state the economy has always been in.

Also in the interview, Rogers stated this concerning interest rates: “Everyone should be raising interest rates, they are too low worldwide. If the world economy gets better, that’s good for commodities demand. If the world economy does not get better, stocks are going to lose a lot as governments will print more money.”

“We never got out of the first recession,” Rogers added. “If the U.S. and Europe continue to slow down, that’s going to affect everyone. The Chinese economy is 1/10 of the U.S. and Europe and India is a quarter of China, they can’t bail us out.”

Concerning commodities, Rogers is still very bullish, and said even if they grow at a rate of 5 to 6 percent annually, they'll still surpass their all-time high, sometime in the next decade.

Rogers said he remains long on commodities.

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