Obama’s economic team attacked
|President Obama’s financial team face instant tough decisions|
One of the world’s best known investors has attacked the record of President Obama’s nominee for Treasury Secretary, Timothy Geithner.
Jim Rogers, a former partner of George Soros, told the BBC that the new administration was “run by people who caused the latest financial problems”.
He said Mr Geithner and Larry Summers, due to head the National Economic Council, have been wrong for 15 years.
“These people don’t know what they’re doing,” he said.
Related article: Geithner pledges ‘dramatic’ action (Financial Times)
Mr Rogers is highly influential in the financial markets.
Investors haven’t always made money from his forecasts. He advised them to back Zimbabwe in the mid-1990s. Since then the country’s economy has virtually collapsed.
But his prediction that commodity prices would soar over the past ten years did prove to be correct.
He made comments on Monday advising investors to sell the pound and sterling has since weakened sharply.
Mr Rogers assured the BBC that he has no position in sterling, so did not benefit from talking the pound down.
Mr Rogers also attacked the British prime minister for selling a large portion of Britain’s gold reserves when gold was at a very low price.
“Gordon Brown sold UK gold at $250 an ounce,” he said. “And this is a man who knows what he’s doing? ” he mused.
He said Britain no longer has anything to sell without North Sea oil and with the City of London “a pale shadow of its former self.”
|Jim Rogers’ private adventures include a 100,000 mile motorcycle trip|
Mr Rogers believes that Asia represents the future for investors.
“China is going to have horrible setbacks, but the 21st century will be the century of Asia,” he said.
He revealed that his children have bank accounts in Swiss Francs as he does not want their assets in dollars.
“There will probably be exchange controls in the US in their lifetime. I have given up on the US dollar and sterling,” he said.
He added that the current actions of governments to restart economies are likely to lead eventually to inflation, and that the only way to protect wealth under those conditions is to hold real assets.
He recommended Chinese shares, the Japanese yen, gold and other real assets.
“The era of paper shufflers is over – farmers are going to inherit the earth again,” he said.
“Bankers should learn how to drive tractors”.
The interview with Jim Rogers was broadcast on World Business News on 21 Jan 09
Page last updated at 20:14 GMT, Wednesday, 21 January 2009
Source: BBC NEWS