Chennai: Ace investor Jim Rogers expects the world to enter the bear market towards the end of this year or early 2023. "We had the longest bull market in American history since 2009. So far it is the longest bull market and then we will have a bear market. I think the next bear market will be longer than ever with so much debt," Rogers told Financial Chronicle over the phone from Singapore.
Rogers, who was co-founder of the Quantum Fund and Soros Fund Management, expects that somewhere down the line equity markets are going to see a correction. Central banks will panic and print more money. "Usually when long bull markets end, they would blow off. It looks to me that this bull market will blow off sometime later this year. If you go back to 1999, there was a huge blow off at the end. It is very common to have a blow off and this will stay there some time and that is the end. They will then collapse. I expect that to happen in 2022 or 2023," he said.
Bonds too would go through a bear market, as bonds have never been so expensive.
"We will see a bear market in the bonds again and this will lead to a bear market in stocks and we will have a blow off. I have not sold stocks yet. Probably, I expect the markets to correct, central banks to panic, print more money and cut back on the monetary tightening. Then there would be the last rally. The rally could last four to six months or even four days. I would certainly sell my stocks and bonds at that time and buy more gold," he added.
Rogers, chairman of Beeland Interests Inc and the creator of the Rogers International Commodities Index, had not bought more gold in 2021 as the prices have been correcting. In fact, he is waiting for more corrections in 2022 before the prices start moving up.
"Corrections will be over when everybody says I will never buy gold again. When I see more despair, when I see more unhappy people, then I will probably buy more gold. My expectation is somewhere in the next few months or weeks, investment markets will be weak and then the central bankers will be worried and they would start printing money again and that would be my signal to buy gold again," he said. Rogers would probably buy more silver than gold, as silver is cheaper.
He also expects the US dollar to go higher. "When we have turmoil, the dollar will go higher and then I hope to sell my US dollar. Dollar has been on a high for several decades now. Very few currencies last for as long as 100 years and the US dollar is coming to an end. If we have that big rally, I will sell my dollars and put my money somewhere else, probably gold," he said.
Rogers feels that the inflation across the globe would continue for some more time.
"Lots of money printing has led to inflation. Lots of borrowing and spending also has led to inflation. So, I am sure we are going to have more inflation and more fear of inflation in the next two or three years."
