Dubbed the "Commodity King," the legendary investor Jim Rogers recently dropped a bombshell at the "Global Chinese Wealth Management and Inheritance Summit" in Singapore, boldly announcing that he has "completely cleared out all US stocks" and warning:
"The next US economic crisis will be the most severe I have ever encountered."
US Debt Shadow and 'Unusual Prosperity'
Rogers bluntly stated that the current US stock market has experienced the longest bull market in history, with valuations pushed to heights not seen even before the 1987 stock market crash. Despite the market's optimistic slogan of "this time is different," for him, when everyone is cheering is precisely the time to be most cautious.
The reason, Rogers explained, is the massive US federal debt: the current total US debt has exceeded 36 trillion dollars, and if unchecked expansion continues, it may surpass 50 trillion dollars by 2032, with the debt-to-GDP ratio likely to climb above 135%. He suggests that the US may repeat the debt crisis of 1976 in the UK, or even face a worse situation.
Meanwhile, he noted that the US unemployment rate has risen to 4.2% in July, and the "unusual prosperity" formed under long-term loose policies may not be sustainable. Once market confidence wavers, the US dollar's safe-haven aura could be quickly eroded.
Asset Relocation: Eastward Shift and Physical Defense
After selling US stocks, Rogers said he has shifted funds to stocks in China and another undisclosed country. He is particularly optimistic about China's tourism and hotel industries, believing the "Belt and Road" effect is similar to the railway expansion of the 19th century, capable of reshaping regional economic relationships.
In terms of hedging, he has increased his silver holdings and emphasized waiting for a gold price correction before entering. In the short term, he still holds US dollars to sell at high prices during panic.
Insights from Reverse Thinking
Rogers is known for co-founding the Quantum Fund with George Soros, which reportedly achieved an astonishing return between 1970 and 1980, with the fund's size growing by 3,365%, far exceeding the Dow Jones Industrial Average's 20% during the same period. Renowned as the "Commodity King" for his expertise in commodity futures, he was dubbed the "Indiana Jones of Finance" by Time magazine for his unique global investment research approach.
As an investment master praised by Buffett for his unparalleled grasp of market trends, Rogers, known for his contrarian approach, once again reminds investors:
"When everyone is excited, it's usually the time you should be worried."
