Subscribe By RSS
Jim Rogers Wants You To Buy US Dollars
By Grace Cheng on May 8, 2008 | More Posts By Grace Cheng | Author's Website
Renowned investor Jim Rogers said today that he is expecting a US dollar rally in the currency markets. The Singapore-based Rogers, who predicted correctly the current commodities boom, said at the launch of the Barclays Global Agriculture Delta Fund in Singapore today he expects a “nice rally” in the US dollar because many people including himself have been bearish on the dollar. He is also bullish on the Australian dollar, saying he does not have plans to sell the Aussie as “they have a great future”. He did say that ” the New Zealand and Australian dollar may get hurt if carry trades reverse”. Many people who called for a dollar rally at the start of this year were hurt when the dollar fell to a record low versus the Euro in late April. There is a good enough chance the dollar could now be bottoming in the short to medium-term against the Euro and Swiss franc, judging from the breaching of certain significant technical price levels and change of sentiment towards the dollar. Last month, Rogers said he was hoping the dollar rally would last a year, which would allow him to sell all of his dollars.
Now that Jim Rogers has spoken his thoughts, and if enough people follow his prediction, the dollar could indeed see the light, and he could get rid of dollars. So Rogers is bullish on the following: Commodities (since 1999), commodity currencies like the Aussie, Kiwi and Loonie, and the US dollar. If you recall, Warren Buffett said over the weekend that not even aliens would like to keep US dollars. Both Buffett and Rogers are on the same page in some way: they don’t really want to hold onto dollars in the long-term. In any case, many people including Rogers, Buffett and George Soros (who co-founded Quantum fund with Rogers in the 1970s) are saying the dollar is losing its status as the world’s reserve currency and a prime candidate replacement is the Euro. Rogers even said today the Chinese yuan could become one in 20 years’ time. Yet, it’s quite unnerving to think that China could hold so much power, considering China’s questionable political and human rights record at this point in time.
Keeping Interest Rates Unchanged
Both the Bank of England and the European Central Bank kept their rates unchanged today. ECB’s Trichet said that “inflation rates have risen significantly since autumn”. He added, “As we have said, inflation rates are expected to remain high for a rather protracted period of time before gradually declining again.” He said there is still a high level of uncertainty resulting from the turmoil, but “the economic fundamentals of the euro area are sound”.
Forex Trading
EUR/USD finally broke below 1.5340, falling 60 pips sharply to expected initial target around 1.5280, a 2-month low. As long as it stays above this level, we can expect some dollar weakness, but if this gives way, it may next target 1.5230, then 1.5200. EUR/USD’s strong bounce from support of 1.5280 meant that USD/CHF couldn’t break higher than 1.0630, causing Swissy to fall back toward 1.0500.
Friday:
Reserve Bank of Australia Quarterly Monetary Policy statement 0130 GMT
Canada unemployment 1100 GMT
US trade balance 1230 GMT
Subscribe by RSS 
Subscribe by Email
Email This Post To A Friend
China must move away from communism
How about euro being the reserve currency for the next few decades?
SOUNDS MORE LIKE ROGERS IS TRYING TO PUMP AND DUMP.
THE AUSSIE AND THE US DOLLAR ARE DIAMETRICALLY OPPOSED. HE LIKES AUSSIES SO HOW CAN HE LIKE GREENBACKS? WHERE IS THE FUNDAMENTAL ANALYSIS?
SINCE ROGERS IS KICKING-OFF A COMMODITIES FUND WHILE CHATTING UP BUCKS, HE SLIPPED UP AND ADMITTED HE WANTS TO SELL THE ONES HE OWNS.
MAKES ME WANT TO DUMP THE BUCK AS WILL ANYBODY WITH ANY SENSE.
US must move away from capitalism.
Cierty, you’ve got to be kidding. If China is communist, then I must be Joseph Stalin. Wake up. Did you ever take a plane ticket to Shanghai. if not, do so. They are communist by the name only. Chinese leaders know the exact definition of a put or a call and will use them when they need them. They run companies on the side of their jobs as rulers.
How do I know that? I live there and my father-in-law in one of them. Rogers is not and never was a short-term investor, hi views are always deadly accurate in the long run and he is going to hit once more. Seen over a multi-decade period the US is a dead cat. Technology is not going to change that. Politicians are going to make it worse and so on. Get used to it.