Jim Rogers: When To Buy Gold

April 23, 2012

Legendary commodity investor offers a wide-ranging view of investment topics, in his own irascible manner.

[This interview originally appeared on HardAssetsInvestor.com and is republished here with permission.]

When Jim Rogers talks, investors listen, although they might be surprised to hear what the contrarian has to say. Rogers, who may be the world’s best-known commodity investor with his Rogers International Commodity Index and best-selling books, including “Hot Commodities,” is also known for swimming against investment currents and traditional thinking. HAI Managing Editor Drew Voros spoke with Rogers from his home in Singapore about gold and how he ignores the metal’s traditional fundamentals; his concerns about “fracking”; the myth of the Chinese real estate bubble; as well as what he calls “fake” good news emanating from dozens of countries facing major elections that he says are masking economic realities.

HardAssetsInvestor: As a resident of Singapore, I wanted to know if you had any insight into the country scrapping its 7 percent goods and service tax on gold. What are some of the intentions behind that?

Jim Rogers: Well, they would like to become a bullion trading center as the other places are becoming: London, Hong Kong, etc. It’s impossible to do that with a 7 percent goods and service tax on precious metals. It doesn’t expire until October, but they’re now in the process of figuring out what to do next. The country is already a trading center in a variety of things.

HAI: Do you think that will motivate some physically backed ETFs to start storing their metals there? Is that something that could happen?

Rogers: Could happen. Of course anything could happen; I don’t know what will happen. They’re still in the process of drawing up the laws. But Singapore is an obvious place for ETFs, especially for Asia because it’s completely liquid, completely trustworthy and completely neutral. Singapore has many advantages that other markets do not have in Asia.

HAI: Have your feelings about gold changed much in the last week since we’ve had the U.S. jobs report, as well as some of the euro debt problems re-emerging? We’re seeing a little bump in gold.

Rogers: I barely pay attention to the stuff you’re talking about. It really doesn’t change my view … as if you think some government statistics — which are wrong at late — would affect anything in my investment world. No, I don’t even know or pay attention to such things.

HAI: You had said a couple of months ago you’d buy gold at $1,250. Do you still think that’s a good price to jump back in?

Rogers: What I said was, if gold gets to $1100 or $1200 or $1300, I would hope I’m smart enough to buy more. I don’t know if it’s going to go there or not. I may buy it at $1850 if war breaks out with Iran. It depends on what happens in the world. What I said was that it won’t surprise me if gold goes down much lower; that’s normal for the way markets work. And if it goes there, I hope I’m smart enough to buy more. But if it goes to $1,550, I would probably buy more. Just depends on what happened.


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