Renowned investor Jim Rogers, co-founder of the Quantum Fund and a veteran in the financial world, recently shared his insights on various economic aspects. In an interview with Kitco News, he discussed topics ranging from the role of Bitcoin, predictions of a potential market crash, and concerns about global conflicts.
Jim Rogers: Bitcoin Not a Threat to Governments
In his interview, Rogers addressed the role of Bitcoin in the global financial landscape. According to him, despite the growth of digital assets, particularly Bitcoin, it currently serves as a trading vehicle and doesn’t pose a threat to governments.
He stated:
“If crypto becomes a threat to governments to their money, they will probably do something, but so far, it’s not a threat. It’s just a trading vehicle.”
Rogers emphasized that if digital assets become a genuine threat to government-backed currencies, actions might be taken. However, he downplayed the global impact of Bitcoin, pointing out that governments are unlikely to recognize it as a legitimate currency due to competition with existing monetary systems.
Rogers views show his skepticism about digital assets becoming widely accepted as money.
He believes that governments oppose the idea of digital assets as competition, and mentioned that while Bitcoin is gaining acceptance, he doesn’t consider it a legitimate currency anywhere except possibly in El Salvador, which has a small population of six million.
He stated that he doesn’t own any digital assets and has never needed them. Despite acknowledging missed opportunities, he highlighted that the dynamics of government and financial systems are not accepting of such changes.
The Role of CBDCs
The investor expressed apprehensions about the increased surveillance potential of Central Bank Digital Currencies (CBDCs), fearing that governments would gain access to detailed information on individuals’ financial activities.
This concern was echoed by former U.S. President Donald Trump, as he commented on the possibility of the country adopting a CBDC. Trump pledged to prevent the currency, citing concerns about its impact on freedom. Meanwhile, the U.S. House Financial Services Committee approved the CBDC Anti-Surveillance State Act as part of an effort against the proposed currency.
Trump recently stated:
“I will fully uphold the Second Amendment. I will never allow the creation of a central bank digital currency where they can rob your money. We will protect innocent life, and we will restore free speech.”
Trump, however, does not hold a favorable view on digital assets and bitcoin either.
The Impact of CBDCs
Looking ahead, Rogers predicted that digital currencies, especially Central Bank Digital Currencies (CBDCs), will likely be embraced globally by several governments. He sees efficiency, cost-effectiveness, and governmental control as driving factors. However, Rogers expressed reservations about the increased surveillance potential of CBDCs, citing concerns about governments having detailed information on individuals’ financial activities.
Rogers predicts that in the future, currencies will shift to digital form on computers due to increased efficiency and cost-effectiveness. He acknowledges that governments favor this transition because it grants them extensive knowledge of individuals’ activities, allowing for potential control.
He highlights that governments will choose a digital currency that will grant them more power, instead of ones that aren’t in their favor. While Rogers expresses personal discomfort with this scenario, he recognizes that governments, with their authority, are likely to implement such changes, ultimately benefiting them more than the general population.
He added:
“It’s not good for you and me, but it’s certainly good for the governments.”
Economic Landscape and Recession Predictions
In the interview, Rogers also delved into his observations of the U.S. economy, predicting an impending recession. He highlighted that the U.S. has experienced the longest period without a recession in its history, and various signs indicate an economic downturn. Rogers pointed out that the increasing national debt, surpassing $34 trillion, raises concerns about the severity of the next recession.
He stated:
“It’s been the longest [period] in American history that we’ve gone without a recession […] It doesn’t mean there will have to be a recession, but we always have. And I see the various signs that something is going to go wrong soon.”
Market Crash and Preparation Strategies
Rogers shared his concerns about a potential market crash, anticipating it to be the worst in his lifetime. He emphasized the urgency of the situation, stating that the next recession could be worse than the 2008 financial crisis due to the substantial increase in global debt.
To prepare for the crisis, Rogers suggested individuals consider investing in tangible assets like gold and silver. Additionally, he pointed out potential opportunities in shorting overvalued stocks such as Alphabet, Amazon, Apple, Meta, Microsoft, NVIDIA, and Tesla.
Related reading: Robert Kiyosaki Confidently Warns Again: “Buy Gold, Silver, Bitcoin. US Is Bankrupt”
He stated:
“I’m afraid I see the signs […] Those are on my list to short because those are the ones that are being exploited and have very high valuations […] In 2008, we had a big problem, but the debt everywhere has skyrocketed since then. So the next recession has to be the worst in my lifetime because the debt is so much higher now than it has ever been before in my lifetime. Even China has a lot of debt now.”
Global Concerns: Regional Conflicts and China-Taiwan Tensions
Expressing worries about global conflicts, Rogers admitted fearing regional conflicts escalating into a major global war. While ruling out an end-of-the-world scenario, he cautioned that the younger generation might face significant challenges. Rogers also shared his belief that Taiwan will eventually become part of China, either peacefully or through less desirable means.
He stated:
“We have small wars now, and historically, small wars somehow or another wind up turning into big wars. We would think that people would learn the lessons of history, but they never do […] I would like to think that we’re smart enough to stay away from war. But, mankind has never been smart enough to avoid wars […] It’s a good time to be an old American because of all of these problems that America’s going to have in the future. I’m not going to be around. It’s not a good time to be a young American.”
Jim Rogers and Navigating Uncertain Times
Older investors like Rogers often fail to see unique characteristics of bitcoin, the ones that have granted it the nickname “digital gold.” Although his insights sound the alarm about economic conditions for many, the role of Bitcoin as an inflation hedge and a borderless, decentralized and scarce digital commodity should not be forgotten.
Jim Rogers’ insights provide a comprehensive view of the current economic landscape. As investors and individuals navigate these uncertain times, considering the role of Bitcoin, preparing for potential market crashes, and staying informed about global concerns become paramount.
