Tuesday, September 11, 2007

Jim Rogers: Will the US Dollar Disappear from the World's Stage

We talked, in a taped telephone interview at his home in Singapore, with Billionaire Jim Rogers, legendary commodities trader, who picked the bottom of the commodities bull market in 1999. With George Soros, Jim Rogers co-founded the Quantum Fund in 1970.

Over the next decade, Quantum Fund grew by more than 3,300 percent. Rogers retired, later a guest professor of finance at the Columbia University Graduate School of Business, and still later circumnavigating the globe to firsthand discover new investment opportunities. He is widely and often quoted in the media about his views on the commodities market. Bestselling author, investment biker, adventure capitalist and widely followed, Jim Rogers talks about what he's now investing in. StockInterview: Is the United States heading toward the same demise as previous colonialists: England, France, Holland, Germany and even previous world powers, such as Spain and Portugal?

Jim Rogers: If all powers, which have risen, have eventually peaked, plateaued, and then declined, we of the U.S. certainly have things going on which would indicate that we are. I dont think anybody would dispute that we are a mature economy and a mature society. Whether were still growing or not is another question. I see many factors where were overextended financially, overextended geo-politically, and overextended militarily. I would suspect the U.S. is in a plateau phase, and perhaps has even gone over the line and is in a decline, certainly on a relative basis.

StockInterview: Who, then, would replace the U.S.? Russia, India, Japan or China?

Jim Rogers: Not Russia. No, Russia is a disaster spiraling downward into a catastrophe. I see little hope for India replacing anybody. India is more likely to break up into a few countries in the next few decades than it is to become the world power. Japan has serious demographic problems. Japans population is in decline for the first time in recorded history. Unless something happens demographically in Japan, Japan is going to have huge problems in the next few decades. Theyve got gigantic internal debt, which somebodys got to pay off. With a declining population and internal debts rising, I think theyve got serious problems. The only one I can see on the horizon is China.

StockInterview: What, then, will become of the U.S. dollar?

Jim Rogers: The same thing that happened to sterling; the same thing that happened with the guilder. You know, the guilder used to be a great international currency. The peso used to be a great international currency. You dont see people using guilders anymore to settle their international debts or finance their wars. They decline and sort of disappear from the world stage. I would certainly get out of the U.S. dollar. Its already losing its status as the worlds reserve currency, as the worlds medium of exchange. We in the U.S. owe the rest of the world at least eight trillion dollars -- thats trillion with a T and its increasing at the rate of one trillion U.S. dollars every 15 months. There are serious problems in the U.S. with the U.S. dollar. I wouldnt own U.S. dollars if I were you.

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James Finch contributes to StockInterview.com and other publications. StockInterviews Investing in the Great Uranium Bull Market has become the most popular book ever published for uranium mining stock investors. Visit http://www.stockinterview.com