"The American economy is already in recession or very close to it, and the administration knows this but is lying to the public," investment guru Jim Rogers told "Globes" in an exclusive interview. He added, "In principle, governments don’t know what is going on. It's possible that in six months, it will discover that we're now in the midst of a recession."
Rogers is unsparing. "[Federal Reserve Board Chairman] Ben Bernanke is an idiot who only knows how to print money. He's an academic with no experience in capital markets. All he has learned is to print money. Many have tried this here and elsewhere in the world, including in Israel, and he will discover what others have learned before him: it causes inflation."
Rogers, the bad boy of Wall Street, is not afraid to be different or to ridicule Bernanke when most of Wall Street praises his interest rate cuts. "Bernanke said that he was prepared to control the printing of money, and if necessary he would fly by helicopter around the world to distribute dollar bills," ridicules Rogers in a sideswipe to a 2002 speech by Bernanke in which he reiterated Milton Friedman's theory that in times of deflation the Federal Reserve can always through money out of helicopters.
Rogers would prefer for Bernanke to let the market correct itself without government intervention. Rogers said that if he were given the mandate, he would do something even more radical: he would dismantle the US central bank. "We were once a country that loaned money. Today we're drowning in debt, and the US owes another $1 trillion every 15 months. Our enemies think about how to exploit this situation to harm us," he says.
It is interesting and important to listen to Rogers, who retired at 37 after the Quantum Fund, which he managed with George Soros, achieved a return of more than 3,300% within a decade. Rogers does not spare Bernanke's predecessor, Alan Greenspan, either. "Greenspan told Congress that he saw no bubble when even my mother could see it. It sometimes seemed to me that Greenspan was saying in interviews things that he heard on CNBC, which was quoting him."
Published by Globes [online], Israel business news - www.globes-online.com - on December 20, 2007
© Copyright of Globes Publisher Itonut (1983) Ltd. 2007