On Wall Street, many people ask the question, “What is the ‘smart money' doing?” I believe it makes sense to follow the best and brightest minds no matter what field you are in. So from time to time, we will take a look at the smart money in a series called Monday Moguls. If you don't want to miss out on the next one, please subscribe to our blog (directly to the right for desktop users or at the bottom of the page for mobile readers).
Jim Rogers is a legendary investor who co-founded the Quantum Fund with George Soros in the 1970s and retired at the age of thirty-seven. He recently released his sixth book, “Street Smarts: Adventures on the Road and in the Markets.” Asked in an interview what message he hoped readers would take away from the book, he said, “Be skeptical, think for yourselves, be independent. The main thing is it's not easy to make money and the conventional wisdom is very rarely right.”
So where does Jim Rogers tell you to invest?
In a recent Reuters TV interview, Rogers shared his thoughts on the markets and where you should invest your money. Here are the highlights.
Will the bull market continue?
We have all the major central banks in the world flooding the world with money. Of course it's going to continue. I don't see anything that's going to stop them right now… It's not sound fundamental reason for the stock market to go up. It's a good party while it lasts.
What is the biggest risk?
When it pops. When this artificial sea of liquidity dries up, it's not going to be fun. But I don't see any reason that it would stop anytime soon. Even if it stops, they (central bankers) are going to get scared and print more.
Where would you invest?
Japan, Russia, some parts of China. The Japanese stock market is down 70% from its all time highs. America is at an all time high. Normally you are better off buying low and selling high. Mr. Abe has no constraint on him or his money printing.
Is there a standout pick for you amongst emerging markets?
The Chinese in November had their economic plenum and they said its one of the three most important in the history of China… I take them at their word. So I would suggest people look at some of the areas that the Chinese said we're going to be spending a lot of money in these areas for the next 20 or 30 years.
With my money I'm going to go along with the Chinese government.
This makes a lot of sense to us. Last September, we suggested the same philosophy as the Chinese government said that they are shifting their focus to service sector growth. We believe that as an investor you should follow the leader.
Do you follow the smart money? Who are your favorite investment gurus?