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tv   [untitled]    May 31, 2012 9:30am-10:00am EDT

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technology innovation. to. russia. now. moves from. the security council. to say yes. but many.
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believe. with the information. on the. global business elite. to discuss the future of the world's economy. you know sometimes you see a story and it seems so you think you understand it and then you glimpse something else and you hear or see some other part of it and realize everything you thought you don't know i'm tom harpur welcome to the big picture.
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hello again a welcome to spotlight. on. today the guest on the show jim rogers the latest g eight meeting in camp david focused on saving europe promised comic night in particular at the gate discussed grease. fox is trying to figure out how to save europe the recession struck nearly four years ago while the aftershock is still there and it's unclear. while the economy finally starts to look so odd there are any signs of life at the him down town hall discussed it with one of the end side of the world financial elite co-founder of the quantum foam.
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despite most countries are claiming to have recovered from the two thousand a crisis of the world economy is unstable in america overspending an enormous public debt threatening new recession europe struggles with the long lost eurozone crisis that devours bailout money and sparks on rest while the west is strongly the focus of the world economy seems to be moving to. more and more economists agree that countries like china india and russia will soon become the translators and mr jim rogers is also one of those with a stake in asia. mr rogers welcome to the show i am delighted to be around thank you thank you very much it's my pleasure well first of all your book gave to my children it's subtitled like how how to live and how to invest so how should we live in what should we invest in the eurozone just just
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let children time not investing in the euro here in the other thing i was afraid has come to the stage where sometime in the next year or two the politicians will think that the easy way is to leave the euro it's not good for greece it's not good for anybody but politicians always look for the easy way out and in the end they will leave and then others will leave and that's going to cause more turmoil be very careful about two thousand and thirteen and two thousand and fourteen if you think it's something similar to what happened to the rubles to what happened to the posts of your state they all thought and as soon as the politicians and they became independent they thought that the easy way is to is to build the country on their own and now they're trying to integrate but it's very own right they found out they were wrong here the same thing is going to happen even greece leaves greece is going to have worthless currency again the old drachmas are going to be printed and it's going to be dead and and recession and no it's not going to work at all but politicians only worry about the next election really don't worry about three elections are played really well in this sense the the politicians the politicians
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that are in this second terms are better they think about the future of humanity. if they can only run one more time no more no course and they look ahead but unfortunately right now what's happening in greece is there is nobody in that state then you guys are coming along and saying we will save you we will get out of the euro and then somebody in portugal is going to say. and then somebody in another country is going to say so there was going to have a fear shock the world's going to have a few shocks in the next two or three years as europe is important well let's take a closer look at the situation in greece where this report from spotlights hill and i do mean that. just two months ago it seemed greece was finally saved from financial disaster the international community agreed a rescue package exceeding one hundred thirty billion euro and the feature readings agency upgraded greece's credit rating to a b. minus a sign it is stable outlook but then politics stepped in greece is inability to
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form a government brought it to the verge of probably the biggest crisis it's faced so far it made greece the major topic of the g eight summit in camp david. greece should remain in the eurozone at least that's what the g eight countries particularly but it's not enough for these countries of the greek people whose citizens must want to deal with and the greek people seem to want to stick to the euro at least judging by their reaction to when the edge daniel american suggestion that the country should hold their referendum on the euro the next we have to remain within the euro because if we return to our old currency we have no idea what will happen we have no idea it would be even worse this is the thing. while g. eight leaders together with the greek people might want to keep the euro their will might not be enough the majority of financial analysts are quite pessimistic these
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days thinking that greece will leave the euro zone it seems to me that the european here right now it's much better prepared. from here as our first of all there is a political effect that their weakest link of the euro zone away without experts in different countries and evaluating the possible outcome of the worst case scenario if greece at truly meet the eurozone. jim rogers here with his comments were mr rogers do you think that russia should really care what happens with greece will we all have to care because what happens with greece will have a snowball effect it will cause more turmoil in currency markets and financial markets and bond markets and then we're all going to be affected it doesn't matter that greece is a small country with ten million people it's going to have many affects in the rest of the world whether we like it or not i don't particularly like it but it's a fact you also mention portugal you know i've been to portugal last summer and
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i've i've realized that the prices went up countries in the course of the country needs money badly but the prices for tourism go up the hotels the food and when i ask them why they said now listen this fuel goes up gasoline goes up so the fisherman charge more and so all the prices go up well well this is absurd they instead of attracting tourists to feed them they they like chased them away and the greeks are doing the same thing it's happening everywhere no that's you and i understand basic economics i hope we do some of these people don't well i think i'm sorry but i think that fisherman we saw he understands basically konami's more than being here at least you know that year and then suddenly he made a very good point that i said before if the drachma comes back it's going to be a nightmare for the greece the greeks for the past two hundred years have had basically nothing but the base currencies inflation recessions has been a terrible place to for as an icon to me and he knows what he's talking about and wish the politicians did ok while the debates are going on well we get all of the
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russian press at least what to do with the ally european economies germany is defending a stereotype measures while the indebted economies on the continent but well especially those on the south they would like to ease budget discipline well what is the better strategy that aman. eventually you run out of money. eventually run out of other people's money the greeks are out of other people's money now everybody who says i want to free large this and i want to free lunch too well but somebody has to pay for and the world as a society we're not going to give them any more money maybe a few more days a few more months or something but the only solution is to start paying off the debt so for all if you look at every one of the countries with an austerity plan the debt is going higher in every country despite our scary that is going to lead to a collapse someday we have to realize what's happened we have to face reality and we
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have to start cutting back i don't particularly like it but facts are facts otherwise otherwise we're going to have dead going higher and higher there's going to be an eventual collapse and then it's going to be a disaster for the whole world you should know the situation in the states and you know have been mean been the most of the people but when i look at what's going on in the states i get a feeling that around a quarter of the american population gets their free love every day for for the end tired of life and will people look at that first of all they want their free lunch too right had suddenly people think what is the collapse you're talking about is going to come in america only fifty percent of people pay tax i mean it's fifty percent of people do not pay any taxes there's no free lunch i would like to be one of those who doesn't have any taxes that was like that but that america is now the largest debtor nation in the history of the world out in the history of the world this is going to have a bad inning down the road when you french president. he has
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won the election with the promise to put the economic growth over the budget discipline what resources does he have to fulfill his promise does he have enough spare money to do that as well that's my point of actually run out of other people's money i'm delighted that he says he's going to. ignore the budget constraints where is he going to get the money i'm not going to giving them are you going to give him the money i don't think russia is going to give him the money i don't think america is going to give him the money no he is not facing reality yet and reality is going to slap him in the face sometime in the next couple of years what's wrong about other people's money this is other people's money is what business is all about because if it's if you're playing with your money it's obvious it's not business people what is great as long as you can get other people's money my point is a very the other people run out of money you're going to run out of other people's
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money and then what are you going to do less you have some money hidden away in your pocket somewhere you're going to have a real problem this is the whole point about the drama they think that if the if they return to drama this is there's got to be their money they're going to print it right there print them but that's what the greeks have done for two hundred years you know the drug war comes and goes it goes up it goes down it's further but a nightmare living in the rats where the greek economy hasn't done much for two hundred they got independence in eighteen thirty two they have not had a good time since eight since independence because they keep printing money well a you mentioned portugal well some people also mention spain but may they really be this don't mean no effective rate falls there are a not exactly the eurozone is stronger than that there then a pack of dominoes isn't what i would hope the euro survives the world needs something to compete with the u.s. dollar the dollar's a terribly flawed currency the euro would be great at least a sound euro would be great so in theory would be good if the weak sisters left the
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euro and the ones who were left were very strong in sound and then you would have a very good currency to compete with the u.s. dollar and forge i don't know if the euro could survive if you have three or four people leaving that's going to be quite a shock whether it's portugal or not i should i was just using that as an example there are many countries that could leave. the first one leaves approved greece leaves then some other politicians go sour i can win an election. by saying i'm going to leave the euro i'll tell the people listen to what he had said and you trigger in the process there i guess what happens now but eventually if the euro can survive all the weak ones getting out for the euro didn't greatest currency in the world he would put the dollar out of business says jim rogers invest truth and wall street spotlight will be back shortly after a break south stay with them. and
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most. welcome back to spotlight and elder love and just a reminder that my guest on the show today is general gers investor wall street guru and indiana jones of capitalism as they nicknamed it well mr rogers don't read a book called a gift to my children a father's lessons for life and investing well just another lesson from the what are you teaching your children in which currency should they put their savings today you said you said that that that that there would be maybe big problems in the year thirteen and in here you said the dollar
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you're not very happy about the dollar so so so what's it going to be you and china actually yes the renminbi is the chinese currency is one of the better currencies in the world but you can't just pick up the phone and buy a lot of a printing b. because it's a block currency but it is legal to buy that and whenever i can i buy buy more and many from myself and from my family the other currencies right now the the swiss franc japanese yen i actually own some dollars at the moment not because it's not good enough because it's a safe haven but both people think it is and if there's more to currency turmoil. people wrongly will flock to the dollar but i have to anticipate what the people do even if they're right or wrong i don't believe in the dollar but i know people do so i own some dollars at the most financial year is the person who knows the economic who watches the power things but judges psychology you have to do what the market is going to do i can't stand and say to the market you're wrong i'll go
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broke no i have to figure out the market i'm going to survive ok what about here you didn't mention you didn't mention sterling well. well well it is it is well. certainly is ok but what i wanted to ask is that if portugal of greece leaves or if they're going to go back to drama this may be a problem but sterling britain is is not there yet if britain decides to and the eurozone will this be a decision meaning that here we are the euro is there for ages and that was that's would be a shock if the if the if europe i mean a thing like the great britain decided to join the euro zone that would be that would be a great boost for the euro but i'm not sure that the u.k. can do it because they're broke themselves you know the u.k. has terrible terrible financial problems themselves big debts and debts are going to higher and higher i don't think that any u.k. politician could win an election saying i'm going to join the euro so you're saying
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here is about the sterling to no no no no europe i mean this is you i love i love the u.k. my most wonderful experiences were in the u.k. but they're in trouble too i mean look at their look at their finances they have running big deficits huge debts no it's not the u.k. that used to be you well look china a country where millions and billions who are there live below the poverty level is doing ok and the countries where people live a comfortable life i mean the people most of the people are in big. what will is that mean china is the model of us me yes i have moved to asia and my children speak chinese because i came in my view china's going to be the most important country in the twenty first century i've got two little girls who both speak chinese as part of what that book's about. they're doing it with the largest creditor nations out in the world now or china korea japan and taiwan hong kong
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singapore the money is in asia the assets are in asia you know who the debtors are you know where they are the world is always changing we're going through a major historic shift where the world is moving from the u.s. . to asia in the one nine hundred twenty s. and one nine hundred thirty s. the world moved from the u.k. to america exacerbated by a financial crisis and mistakes made by politicians the same thing is happening now it always happens how the thing that is the norm that's normal in the world is change and we're having more change as we said here but my point is that. the better the better the chinese economy will do the more people there will live a better life doesn't mean when the majority of the chinese people will be leaving living decent lives they will be having problems too probably probably the central move to africa venture one hundred years from now or whatever yeah the chinese are
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going to be on top of the world and then they'll get fat and lazy and sloppy and they'll start declining the problem with americans and the british will be going to far to lose you. like has a rich very successful. yeah we're actually most of most americans are now obese i mean the districts are pretty frightening about america or whatever have no us fat and lazy people like you the fat cat or the people i mean to be the blue collar or or both of them let me repeat fifty percent of america's do not pay taxes so they're doing some things to so that they can support themselves by other people other people's money who are packing other people's money again so america is not competitive anymore and i don't like saying this how i'm an american citizen american taxpayer weren't you know you know they're supposed to criticize the country when being abroad ever exactly but america is not competitive we have a constant balance of trade surplus we're not we cannot compete with most other
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countries anymore we've got. a mail from one of our listeners who knew you were coming and they here's what he writes do you prefer commodities or first of all gold. over for investment why and for how long will the prices continue to support for real assets because if the world economy gets better the price of commodities is going to go higher because of shortages if the world economy does not get better then congress are going to print money it's a wrong thing to do but that's all they know to do so they will print a lot of money in throughout history you own real goods when they print money whether it's silver or rice you won't real stuff so yes i prefer real assets to stocks and bonds anywhere in the world right now what's going to happen to all prices russia is very much dependent on you know the new government and we got i heard a good comment yesterday somebody said this is a hundred dollars that this is
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a government that's worth one hundred dollars is the why so because they they are there until. higher the hundred dollar one all because of the underbelly they lose their jobs so what's up with what's happening to well why is it is it keeping is it helding the dead or the price despite the stagnation of it well because the world is running out of known reserves of oil well i mean whether we like it or not known reserves are in decline all over the world there may be a glut of oil at the moment as a small group but every country in the world except brazil has less oil this year than last year and every year we're running out of all of that's why the oil and oil is going to go much higher out the but unless we discover a lot of oil very quickly in very accessible places the surprise is going to be how high the price of oil stays and how high it goes now if there's a shock if greece goes bankrupt or gets out of the euro something or if we go to eighty i mean you pick the number everything will go down for
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a while but if that happens you buy all you can because whether it's gold or silver or rice or oil biology you can because in governments are going to print more money . you you are quoted as saying that by the end of two thousand and thirteen they may be a new crisis or a new set of problems for the world economy what do you think maybe the trigger for this sell every four to six years in america we've had a setback we've had an economic recession or a slowdown in mathematics history this is the way the world works i would like to say you know we're never going to have another recession in america again as long as it's long as the world exists that's not going to have we have an election in two thousand and twelve but obama spending all the money he can printing all the money he can to get reelected so there's a lot of good news at the moment but it things are getting worse because the debt is going higher and higher and higher two thousand you can end for. six is two
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thousand and thirteen so we're going to have the problems in thirteen and fourteen the last recession started in two thousand and seven two thousand and thirteen is six years be very careful the election will be over the bad news will start coming out they will be able to cover it up any more and be worried be worried who will suffer most. what kind of the kind of use the emerging economies the developed economies the economies we don't have natural resources so russia will be ok russia will be better in better position than the countries which don't help japan belgium will suffer more than australia canada will do better than the us canada has a lot of natural resources the us does if you find well managed countries with natural resources they will do a lot better than the ones that don't have naturally said especially in finance i don't have debt if you find ones that have a lot of money saved up for a rainy day when the rainy day comes they'll start spending what class people
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suffer with the poor the rich the middle class well when you have economic turmoil usually the people who lose their jobs i mean you know the poor people of the middle class are the ones who lose their jobs most of all. and so they will suffer the most in many countries there are safety nets now to take care of people who are thrown out of work but everybody will suffer i mean even if you're a rich guy you're going to have your business is going to be suffering because everybody else is suffering you know and then as we know the rich people are different from the poor the then they can afford more debt. and when it goes down you're here you are you broke ok now you're also quoted as saying. that for example congo it's rich in commodities because the common me is poorly managed you said that it may have problems russia has also managed to come out of this and we russians at least like to say that that we are poor managers of our own commodities
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doesn't mean well from your point of view that that russia and congo are similar well you said russia is bad bad is i didn't say that but if you read russian you open any russian paper and you know russians are very critical of their own government well as you are also that's good i mean people should be critical of a government which deserves criticism i mean absolutely thank goodness they can do that and russia could do when you could not criticize your government in this country so but the well managed countries and i don't consider the congo well managed so i don't think i'm not putting money into the congo but if russia is well managed you will certainly do even if you're not well managed you can do better than others because you have resources but if your newspapers are right and you're not well managed you're not doing as well as maybe canada well mr rogers you're one of the guys that you can talk to for hours but we're running out of time and thank you thank you very much for coming in just to remind them my guest today was jim rogers investor and insider and author of
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a book called a gift to my children a book where we explain to his own children how to live and how to thank you for the oneness model. we'll be back with more until then stay apart seems to take. place. the body. moves.
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that's.

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