Thursday, November 5, 2009

Rogers Says Roubini Is Wrong on Bubbles as Gold, Stocks Rally

I've not been featuring Jim Rogers for a while. No quarrel with him that commodities are performing below expectation, the CRB index only gone up by 37% from the low, has not been catching up with most of the stock indices(at least 50% or more). His changing tone on emerging stock markets is something a surprise to me. I suspect he is looking for a correction to buy before the last train leaves the station.

(Bloomberg)Nov. 4 (Bloomberg) -- Jim Rogers, the investor who predicted the start of the commodities rally in 1999, said that Nouriel Roubini is wrong about the threat of bubbles in gold and emerging-market stocks.

Many commodities are still down from record highs and equity markets aren’t on the brink of collapse, Rogers, chairman of Singapore-based Rogers Holdings, said in an interview on Bloomberg Television today. The price of gold will double to at least $2,000 an ounce in the next decade, he said.

Roubini, the New York University professor who warned in 2006 about the coming financial crisis, said on Oct. 27 that investors are borrowing dollars to buy assets and creating “huge” asset bubbles. Rogers said that he’s not buying stocks now, though he may buy more gold.

“What bubble?” Rogers said, when asked if he agreed with Roubini’s view. “It’s clear Mr. Roubini hasn’t done his homework, yet again.”

Roubini told a conference in South Africa last month that investors were doing “the mother of all carry trades” by buying assets with borrowed dollars. He said emerging-market equities are showing a bubble, that gains in some developing- nation currencies are becoming “excessive” and that the rally in oil is “not justified by the fundamentals.”

Read more

No comments: