US Recession Overdue, AI Bubble Real: U.S investor Jim Rogers

Chennai: Ace investor and financial commentator Jim Rogers finds that a recession in the US market is coming in the foreseeable future. He recognises the speculative frenzy in the Artificial Intelligence market and argues that an AI bubble is real. He is neither investing in US treasury bonds nor accumulating US dollars. Instead, he urges everyone to invest in gold and silver to protect themselves when things go wrong.

So last time when we had a conversation in April 2025, you had said that you would be buying more silver because prices would shoot up. Silver was trading around $33 per ounce. And in the subsequent months, we saw silver going up and touched $121 in January. Those who bought silver earned fortune for themselves. Did you sell your silver when the prices touched record high? And will you buy more now that the prices have come down to $65 levels? What is your outlook on silver?

My attitude towards silver is I don't ever want to sell my silver. I don't ever want to sell my gold. It's for my children someday. So if and when prices go down, I hope I'm smart enough to buy more. I repeat, I hope that I never sell my gold. I hope I never sell my silver. It's for my children.

Okay, reports have been coming saying that silver could probably go to $200 per ounce in the next two years. How do you see this kind of projections?

Well it certainly can. I mean, if you look around the world, politicians everywhere are printing staggering amounts of money and running up huge debts. So, I mean people have to protect themselves and throughout history silver and gold have been ways to protect yourself. You remember Jesus Christ? Jesus Christ was sold for thirty pieces of silver. Because even in that time silver was extremely important and extremely valuable. It always has been and probably always will be.

And what about gold? As you said, you will not be selling gold as well as silver. Several projections say that gold would probably touch $8,000 per ounce or may even go up to $10,000 in the next two years. What is your take on those kind of projections?

Well I repeat, I do not sell my silver, I do not sell my gold. It's for my children someday and my grandchildren, I hope. I mean everybody should have some silver and some gold in the closet. Everybody should have some under the bed. Everybody should know that silver and gold are a way to protect yourself if things go wrong.

So now coming to AI, artificial intelligence, we have seen investors pumping in money to AI startups and you're also aware about that. The way the valuations have been going up, several market analysts are worried about an AI bubble that could probably burst soon. What are your views on this? An AI bubble or whether we would see a burst happening?

Well Sangeetha, this has happened many times in history. Remember railroads, remember automobiles, remember electricity, radio. Many of these things have happened in the past. Human beings are still human beings. We get carried away when something new comes along. We usually drive the price too high, then it goes too high, and then it collapses, and everybody's unhappy.

But the technology usually survives and that is happening again. I hope you and I live long enough to see it many, many, many times. Change and progress is good.

But then this kind of speculative frenzy that is going on in the markets, what do you think about it?

Well, Sangeetha, I'm old enough to have seen many frenzies in the markets. People always get excited about things that are new. And people always say it's different this time. Do not worry, it is different this time.

Sangeetha, if you hear people tell you it's different this time, be very careful. Be very careful because human beings don't change. We get too excited sometimes, but we lead to bubbles. There have been bubbles many times in world history. I hope you and I live long enough to see many more.

Are we actually getting closer to that AI bubble bursting?

I'm not smart enough to tell you when a bubble's gonna burst. I recognize bubbles, when everybody is saying, it's fantastic, it's going to change the world. When people tell you it is different this time, start asking questions and be worried. Because people get too excited many times and prices go too high. Bubbles burst, they always have.

And people have not learned the lessons?

I just try to stay away. Sometimes I sell them short, but not always.

So have you invested in the AI startups that have valuations going up?

Well, I'm not selling short AI by any stretch. I mean it maybe it's going to be a big, big bubble someday. Most of these things do become big, big bubbles. But when you go to the restaurant and everybody's telling you, it is different this time. Prices will continue to go up many, many times. Start getting worried.

Now coming to US bonds, the 30 year US treasury yield had recently climbed very close to 5%. We also saw the US deciding to buy Japanese yen to protect the US bond market. Is this the beginning of a much bigger bond crisis?

Japan is a wonderful country. But the population has been declining for fifteen years. The debt has been going straight up for many, many years. So Japan has a serious problem long term. I do not own anything in Japan. I have not sold anything short in Japan, but I see the problems.

I mean, I don't know what Japan is going to do. The debt goes higher, the population goes down.

I am not buying Japanese yen. I cannot let the US Treasury Secretary tell me what to do, but I am not buying Japanese yen or Japanese bonds nor am I buying Japanese shares. I'm doing nothing in Japan. I am watching.

What about US bonds?

Well, I am not buying US bonds either. I know that some people are, I don't see any reason to buy US bonds. The debts are going higher and higher and higher and inflation is getting worse. I see no reason I'm not short American bonds, but I am not buying American bonds, not now.

So even last time when we were talking, you were worried about the US debt. At what point will America's debt burden become a genuine threat to the dollar and global financial stability? And now that we are also hearing that the US Federal Reserve will probably go for an interest rate hike. So in that case, do you think there is a kind of threat to global financial stability?

The US dollar is still the world reserve currency, that is changing slowly, but it is changing. I'm not the only one who knows that the US has staggering debt and it's getting worse. But at the moment the world and me consider the US dollar as the world's reserve currency and we use it. I own a lot of US dollars now.

Now you will probably say why, if the US is a huge debtor and getting worse. And I do Sangeetha because everybody considers the US dollar a safe haven. And when there are problems, people go to the US dollar.

Now it's not a safe haven, but that will change eventually. And when they do, I and everybody else is gonna have to go somewhere else.

I don't know where yet. If you know where, if you know what will be the new replacement for the US dollar, please do not announce it. Please send me an email. Please send me a private email. Because I am looking.

More and more people understand that the US is a gigantic debtor and that the debt is getting worse every day, and many people are looking for something else, something else to compete with the dollar. I have not found that yet.

If we were talking a hundred years ago, it would have been the pound sterling. There would have been no other discussion. There would have been pound sterling, full stop. The world changed, moved to the US dollar. But now where? What do we do next?

So what do you think about Chinese Yuan? Because China has been making a lot of efforts to raise the status of Yuan as a global currency. What are the kind of prospects the Chinese Yuan has? There are also people who say that we will probably have digital currencies which are backed by commodities like gold and silver. What is your take on this?

Well, the Chinese currency is a logical competitor to the dollar. The problem, Sangeetha, is that the Chinese currency is not completely freely convertible. And I don't think you can have an international reserve currency that's not totally convertible. The Chinese are moving that way, it's getting more convertible, but it's not completely free yet.

If and when it gets there then that may be the answer. I do not know. I do own some Chinese currency, but I have not converted all of my US dollars into Chinese currency yet. I am still looking and still watching the world.

If the Chinese currency is completely backed by gold and silver, and it has been at times in their history, it will make it much, much, much more attractive. Then maybe we'll all have to go to the Chinese currency.

Since our conversation in April 2025, the world has gone through a large turmoil which includes trade disruptions due to the US tariffs and the geopolitical tensions in West Asia. How do you evaluate the trajectory of the global economy going ahead? Do you see a global recession coming or can the US and the emerging markets continue to grow despite high levels of debt, geopolitical tensions and expensive money?

Well Sangeetha, it's been a very long time in historic terms, since we've had a recession in the US. I use the US because it's the largest economy, not since 2008. So historically we are overdue. It is probably coming. It's not here yet.

But history would tell us that, yes, we're going to have a recession in the US and therefore the world, sometime in the foreseeable future. I am not acting, I am not investing like that yet, but I am watching carefully because I know history says it's coming soon. I don't know when. I have to watch your show to find out when. You can tell us.

So now coming to India, what do you think about the Indian equity market currently and the current valuations that we have? Are they at the right levels for you to buy? If so, which would be the stocks you will be buying?

I certainly love India very much in many ways, and it is getting more and more exciting as an investment destination. I do not have anything in India right now. The market's at an all-time high, because many other people understand the changes that are taking place in India. I hope that if things go down, that I'm smart enough to buy Indian shares again.

India's making, I mean in Delhi and all over India people are understanding that success is good. For many decades the politicians thought they didn't like rich people, they didn't like successful people.

But that is changing in India. They know that success is good and it's going to make India even more exciting. India's an extremely exciting country to visit, but now it's becoming an extremely exciting place to invest. I have no investments, but I want to invest more there.

So compared to last year, our valuations of many companies and especially in sectors like technology, have gone down. Do you think further correction in valuations could probably happen?

Of course it can happen and it probably will happen. India the markets had great, great, great profits. They went straight up for a while. Normal for markets to correct and react. I'm not a very good market timer, but I hope I'm smart enough to buy India sometime in the future. If it keeps going down, I will keep watching more closely.

India's opening up to the outside world more and more. So travel and tourism, banking, money, anything to do with money will be more open. So there will be many opportunities in India.

What about technology or infrastructure?

Go anywhere in the world and you'll see lots of Indian engineers in the back offices doing things. Because for some reason the Indians are very, or many Indians are very good at technology in the US, everybody, if you go to the back office, the boss will tell you, we need to find some more Indians. 'Cause they're so good at this. And they are. And smart and hard working.

At this point of time which asset class do you prefer to put your money in?

I'm looking for that too right now. Right now I have most of my money, as I said, in US dollars. I own some Chinese shares, I own some Uzbekistan shares, but mainly I have US dollars and I'm trying to decide. Nearly every market in the world has been going straight up. That usually is the time to get out.

So I am mainly watching and trying to decide what to do. I am looking for a new market, but I have not found it yet.

What about Uzbekistan? What kind of prospects do you see in that country?

Well, if you look at a map, Uzbekistan is well located. Uzbekistan historically at times has been a very successful country. It's got lots of natural resources, lots of rich neighbors. The good news is most people cannot find Uzbekistan on the map, but I find that attractive.

There are not many companies, but they're becoming more and more. So I usually find that attractive.