Mr. Rogers explained that it is just a matter of time before Russia becomes a major partner in Asia. According to him, the United States would not receive a share of the opportunities in the Asian market if Russian becomes a major partner of the region. He said, The “US simply shot itself in the leg.”
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Livermore Strategic Opportunities, LP performance update for the month of February 2021. Q4 2020 hedge fund letters, conferences and more Many of you are witnessing first hand that our country, economy, (and now stock market) are all very fractured and becoming extremely challenged. Therefore, our hedge fund's theme remains focused on specific sectors and companies. Read More
Mr, Rogers pointed out that the Asian market has 3 billion people. It is much larger than the combined population of Europe and the United States, which is estimated to more than 1 billion people.
“For Russia it is better to be with 3 billion creditors than 1 billion debtors,” the investor explained,” said Mr. Rogers. He added that the money is China, Hong Kong, Japan, Taiwan, Korea, and Singapore while the largest debtors are in Europe and the United States.
Rogers talks about the U.S. dollar, Russian ruble
Mr. Rogers said the U.S. dollar is currently in a terrible situation citing the reason that America has a huge trade deficit and national debt.
On the other hand, Mr. Rogers noted that Russia has low debt and convertible currency, unlike Greece. According to him, the current situation of the ruble is unique for the new markets. He considered the position of the ruble as fundamentally normal as it is currently pressured bu lower oil prices. He believed that the ruble’s situation would improve once oil prices become stable.
“If we simply write out on paper the facts that lie behind the ruble and the dollar, without naming the currency, then everyone will want to buy rubles and no one will buy dollars. But as soon as you name them then, of course, people buy dollars,” said Mr. Rogers.
The American investor also said he hopes to be smart enough to get rid of dollars before a collapse happens. “Everything seems perfect, until one day it ceases to be so. It was the same with Britain, France, Spain and Greece. Often stocks manage to go up for a few years before hitting bankruptcy,” said Mr. Rogers.
Mr. Rogers has been investing in Russia. He acquired shares of PhosAgro, a global vertically integrated phosphate-based fertilizer producer. He is a member of the board of directors of PhosAgro. He also owns a stake in the Moscow Stock Exchange and Aeroflot.
Rogers said financial markets could face problems
In a separate interview with Puneet Wadhwa of Business Standard, Mr. Rogers said the bond market is currently experiencing the biggest bubble. He added that several factors including stock market declines and bankruptcies would affect the financial markets.
Mr. Rogers said, “I think we have seen bad times for a while. However, over the next couple of years, there will still be a pain. I am not very good at short-term trading, but I certainly know we will have plenty of problems in financial markets over the next couple of years.”
Rogers is buying Chinese equities
When asked about the developments in China, Mr. Rogers described the big drop in the commodity prices as “artificial and forced liquidation” from people who need to raise money.
Mr. Rogers explained, “Many stocks in China are closed, so one cannot trade in those. The people who had margin calls and who had borrowed money had to sell anything to raise money, as they could not sell stocks.”
“Once this artificial liquidation is over, I suspect base metals would be a good place to be in. The Chinese have borrowed against their copper and other base metals, so they were forced to sell when they got huge margin calls. I suspect we will see some kind of bottom going forward,” he added.
Furthermore, he noted that Chinese equities “went up very quickly” and “were bought with borrowed money.” According to him, investors panicked when the stocks started to go down and were compelled to sell their stakes,
Mr. Rogers said, “I have been buying shares, and I had orders well below the market. I have been buying for the past couple of days.”