October 24th, 2007
NW Teong
This morning, I read an article titled “Jim Rogers Shifts Assets Out of Dollar to Buy Yuan” from Bloomberg website with great interest. For those who wish to read this article, you may wish to click the link here:
http://www.bloomberg.com/apps/news?id=20601087&sid=aqNT0qlW_zQE&refer=home.
The gist of this article is that Rogers is very bearish on US dollar and very bullish on China RMB or yuan as well as commodities. He feels that yuan could appreciate as much as quadruple in the next decade. On currency front, he is also bullish on Swiss Franc and Japanese Yen.
Rogers remains very bullish on commodities, he feels that the bull in commodities could last as long as next 5-15 years. While I am not able to predict how long the bull would last in the commodities, what I noted with great interest is that Rogers’ view on currency as well as commodities is basically in line with my own (for those who read my blogs for the first time,
please refer to my earlier blogs).
Rogers also feel that the bull markets for stocks and bonds are over. While I share his view on bonds, I bet to differ on the stock markets.
I feel that we still have one last leg for bull on stock markets (please read my earlier blog on this, also my comment on yesterday’s blog “Big Scare”).
Base on the above view, we should then devise our investment strategies accordingly. Please note that if investors such as Rogers are switching their US assets into Asia based assets, many more will follow. What will happen then? Logically speaking, if the initial trickle leads to a stampede, US$ will collapse vis-à-vis other currencies. We have to watch out on this space. While a gradual depreciation is acceptable, a sudden collapse of US$ would be very disruptive to global trades and hence would be bad for world economy. I am sure Rogers is not the first one to shift its US assets into Asia assets (especially China and India) and obviously he will not be the last one as well. On the contrary, there will be more investors to follow this path. If you can recall, we have already witnessed some divestments of US assets by Asian sovereign funds. It is definitely worth while to monitor the funds outflow from the US and its impact on the weak US$. Cheers!
Master “The Essence of Stock Investment” and ride towards the journey of your financial freedom to be the “Master of Your Own Destiny”!
Disclaimer: Investors are investing at your own risk. Please read full disclaimer at the end of the blog or from the main page of the website.
Entry Filed under: Currencies, Commodities, US Stocks, Macro, Stocks
1 Comment Add your own
1. Bubbi | April 14th, 2011 at 11:27 am
I’m not eilasy impressed. . . but that’s impressing me!
Leave a Comment
Some HTML allowed:
<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <code> <em> <i> <strike> <strong>
Trackback this post | Subscribe to the comments via RSS Feed