Veteran investor Jim Rogers, who co-founded the Quantum Fund with billionaire investor George Soros, has warned that “the worst is yet to come” for the U.S. economy. “The U.S. is going to suffer” as the value of the dollar erodes further, he predicted, emphasizing that inflation and the debt problems are going to get worse.
Jim Rogers Says ‘the Worst Is yet to Come’
Veteran investor Jim Rogers issued several warnings about the U.S. economy on Sputnik’s New Rules podcast, published last week. Rogers is George Soros’ former business partner who co-founded the Quantum Fund and Soros Fund Management.
“The worst is yet to come,” the renowned investor warned. “It always comes later after normal fluctuations and corrections.” Rogers explained: “We have printed a lot of money, we have borrowed and spent a lot of money, which is wonderful for the short term, but eventually we have to pay the price.” He cautioned:
Inflation is going to get worse. The debt problems are going to get worse, and the U.S. is going to suffer.
Drawing a comparison between the present circumstances and the 1980s, a period marked by significant inflation, he stressed, “The inflation now is worse,” noting that the U.S. is now the “largest debtor nation in the history of the world.”
While stating that “things are okay at the moment,” Rogers noted that it won’t last forever. “Somebody has got to pay this debt. Somebody has to print more money. Somebody has to borrow more money. And when you borrow huge amounts of money, interest rates will go higher and higher, inflation will go higher because so much money has been printed,” he detailed, emphasizing:
The value of the U.S. dollar will lose more and more value as [the U.S.] prints more. It always happens this way.
Using the British Empire as an example, Rogers highlighted that during the 1920s, Britain held the position as the wealthiest and most influential nation globally, surpassing all others. However, five decades later, the country found itself in a dire financial state, to the extent that the International Monetary Fund (IMF) had to intervene.
“That will happen to the U.S.,” Rogers predicted, clarifying that “It won’t happen this year, but it will happen.”
Last month, U.S. Treasury Secretary Janet Yellen defended the dominance of the U.S. dollar, arguing that the USD is used widely in trade because the U.S. has “deep, liquid, open capital markets, rule of law, and long and deep financial instruments.” However, she acknowledged in April that over time, the use of financial sanctions “could undermine the hegemony of the dollar.” She also said earlier this month that the ongoing trend of countries seeking to establish an alternative reserve currency to rival the U.S. dollar “is something that we simply have to expect.” Nonetheless, she emphasized that no country is able to replicate the USD, including China.
While concurring with Yellen, Rogers pointed out that the treasury secretary left out the fact that the U.S. is “the largest debtor in history and the debt is skyrocketing and the money printing is skyrocketing.”
He cautioned: “Eventually we have to pay the price. Every country in history has had to pay the price. Yes, she will print huge amounts of money. She will borrow and spend huge amounts of money, and they will think they are okay for a while, just as they have for other countries in the past. But, unless something has changed in world history and in world economics, this will not go on forever.”
Commenting on U.S. dollar alternatives, the famous investor said, “I don’t see anything on the horizon yet,” adding:
That may cause a big problem if and when things really go wrong with the U.S. and with the U.S. dollar, the world will have a serious financial crisis for a while anyway, unless we can bond something else.
“It is extremely important, especially when a crisis comes, that you have your money in a place that you yourself understand a lot about,” he concluded.
Rogers has repeatedly warned about the worst bear market in his lifetime, stating that investors should be worried. He said in May that the U.S. dollar’s time is coming to an end as a growing number of nations worldwide seek to de-dollarize.
Others have similarly sounded the alarm about inflation, the debt crisis, and the demise of the U.S. dollar, including economist Peter Schiff and Rich Dad Poor Dad author Robert Kiyosaki. Schiff said in June that the U.S. dollar decline will be “far greater” than what Yellen described, noting that Federal Reserve Chairman Jerome Powell is “clearly worried” about a financial crisis. He also warned of a U.S. dollar crisis, predicting that national debt will “spiral out of control.”
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