Global markets are on edge, oil prices are falling, gold continues to rise in value, Spain got a no-austerity bailout, Italy says it doesn’t need a bailout, Greece wants to get out of its austerity obligations, the U.S. has $1.5 trillion deficit, 8.2 percent unemployment, and a declining manufacturing sector.
Not a pretty picture, is it?
There is a lot of uncertainty in the global economy and very, very few analysts know where this thing is headed (although a lot of us can take a guess). But when we say “few analysts,” we don’t mean all. Luckily, there's still a handful of individuals who, with years of experience under the belt, can offer advice or, at the
very least, warnings about what to expect in the future.
Jim Rogers is one of those individuals.
James Stafford of Oilprice.com took the opportunity to sit down with the legendary investor and pick his brain about the global economy and recent developments in the energy world.
“It’s been an interesting period in the energy world as we’ve seen oil prices steadily decline over the past few months and with the problems in Europe and slowdowns in India and China do you expect this trend to continue?” Stafford asked.
“Well, there is certainly a correction going on for various reasons. I think Saudi Arabia's trying to help re-elect Mr. Obama. There are also stories that JP Morgan has problems in its London office with a lot of unauthorized positions they're having to liquidate," Rogers responded.
"I don't know what's going on, but I do know that corrections are normal in the industrial world. There's nothing unusual about it. If it continues, there’s an opportunity to buy more,” he added.
Later in the interview, Stafford turned to the topic of geopolitical events.
"The Arab Spring shook energy markets in 2011 -- are there any potential geopolitical events taking place apart from the Iranian situation that could cause oil prices to skyrocket?” Stafford asked.
“There are always geo-political possibilities. If oil goes down, Saudi Arabia's going to have more trouble buying peace. Any country's going to have more problems buying peace,” Rogers responded.
Iraq is being driven into the arms of Iran. America has spent staggering amounts of money in this region, and what we're getting for it is a possible alliance between Iran and Iraq.
All sorts of things could happen in the future, especially if Iran and Iraq get closer together. That's going to put America in a terrible situation, the world in a terrible situation.
The good news is the world is always changing dramatically. The bad news is, the world is always changing dramatically.
Rogers and Stafford went on to discuss everything from the possibility of oil prices falling below $40 a barrel, why Rogers is optimistic about Nuclear energy, unrest in the Middle East, and why Greece should be allowed to fail.
Front page photo source: Polinance