Jim Rogers' quarrel with CNBC

Key points of he was saying

1. Stock market sells down by forced selling(redemptions due to financial institutions failures like Lehman Brother, AIG and etc) cause temporary deflation but long term is inflation.

2. Long commodities short stocks ( Toyota, IBM, Bank of America and etc.......)

3. The world is going to recover some day but it is going to be inflation because of gigantic amount of money has been printed.

4. 1929 bank runs cause by liquidity problem. Now is different, you have banks with horrible balance sheets, you should let them fail.

5. He has not sold his oils though it have been on free falling of more than 50%.

My views:-
I agree with him the recent panic selling was due to forced selling.

Long commodities - yes - but timing could be tricky. Short stocks ? Yes selectively on those heading towards down cycle and has weak balance sheet(too bad we can't do it here much compare to other markets) but we can also long the right stocks (stocks in with pricing power, strong free-cash-flow and a consistent dividend paymaster or simply buy an index fund).

Sorry Jim. I cannot agree with you. Governments interventions were necessary, credit markets literally frozen and spilled over into the real economy.

Not selling when things corrected over 50% ? Yes, I have a few of those as you can see it, I did not sell it out mainly as this is a long term portfolio and making it as passive as possible. I will use mainly dollar averaging to lower my average costs - make up timing mistake or irrational selling by others. In current volatile market environment, I can easily whip-saw by the market, if I make 3 mistakes in a row with 20% stop-loss, I would have an equivalent loss of 48.8%(1-0.8*0.8*0.8). I'm going to look like a fool either I am playing the passive or active way. If I cannot live with the negative marks on my portfolio, step out from stock market completely, I should not own stocks at this moment. But I should not get angry later when the market snap back and I am out of the market

The other objective I have is to let others to draw strengths and inspirations. We typically will feel very anxious and tend to follow the crowd to sell regardless of the reasons. We got to know some people got to sell because they have no choice as they are facing redemptions but we are not. You can always come back to my blog if you have peer pressure - at least know one person is not selling out yet. One caveat though, provided you are holding fundamentally sound companies. I hope to be a living testimony to walk the talk. In relative performance comparison, I am still doing all right.

I will be traveling next week, postings can be erratic. Good luck to all.