US Dollar Rally to End

Jim Rogers, the Sage Of Singapore, has been pretty accurate in his predictions so far. He predicts now that the dollar rally will end soon. His reasoning is pretty tight and I would be the last person to disagree with him.

My friends and people I know have been preparing for this for years and buying gold and silver. I bet buying Euro and British Pounds is also a good idea now. I would not bet on US stocks though as the stock market only has sucker rallies – there is no increase in productivity in the US. This is the key to economic growth, not consumption and spending. Consumers are realizing borrowing to spend can only last so long.

Click here for full story.

http://www.bloomberg.com/apps/news?pid=20601100&sid=a3YnR0N8LgpQ&refer=germany

Excerpt:

May 12 (Bloomberg) — The dollar’s rally is set to end in a “currency crisis,” investor Jim Rogers said, adding that he may bet on a slide in equities after nine weeks of gains.

The advance in the U.S. currency has been driven by investors covering their short sales, Rogers, 66, said in an interview with Bloomberg Television in Singapore. He may consider adding to his holdings of the yen and prefers the euro to the dollar or the pound, the investor added.

“We’re going to have a currency crisis, probably this fall or the fall of 2010,” Rogers said. “It’s been building up for a long time. We’ve had a huge rally in the dollar, an artificial rally in the dollar, so it’s time for a currency crisis.”

The dollar has climbed against all of the so-called Group of 10 currencies except the yen over the past 12 months, according to data compiled by Bloomberg. The U.S. currency was at $1.3592 per euro today from $1.3582.

Rogers joins “Black Swan” author Nassim Nicholas Taleb in avoiding the U.S. currency. Taleb told a May 7 conference in Singapore he preferred gold and copper to the dollar and the euro as the global economy faces a “big deflation.”

~ by underboss on May 13, 2009.