By George Iype/ Singapore
He predicted a recession in the United States, sold an upmarket Manhattan home, packed bags and moved with his family to settle down in Singapore last year. These days, it is easy to find legendary global investor and commodities guru Jim Rogers relaxing on his exercise bicycle in the peppy Tree Top Apartments at the Orange Grove Road in the heart of Singapore. “I love cycling. This is what keeps me fresh and healthy,” says Rogers, as he begins cycling and talks about a myriad of subjects.

For the last one year, Singapore, the rest of Asia, has been fascinating for Rogers. But why did he sell his beloved Manhattan home and move to Singapore. Pat comes the reply: “I was getting wary of the US economy. I always want to be closer to the economic boom. I chose Singapore to be closer to the economic boom in countries like China and India. And Singapore is one of the best livable cities in the world.” You might feel Jim Rogers is talking harsh on the US and talking loud on countries like China.

Why is it that he hates the US these days? “I don't hate any country. I have all the love and respect for the US and all the countries in the world. That is why I went on two world tours, covering most countries. I only hate politicians, not countries,” Rogers says in his inimitable way.

Rogers is one of the world's best-known investors. His words on commodities are Biblical. More than that, he is the well-known author of books like Hot Commodities and A Bull in China, a must read for anyone who wants investing wisdom. He has been frequently featured in leading global publications like Time, The Washington Post, The New York Times, The Wall Street Journal and The Financial Times. No one perhaps talks better than Rogers on commodities. His life story is amazing.

Rogers, born in 1942, grew up in Demopolis, Alabama, and got started in business at the age of five, selling peanuts. Years later, after attending Yale and Oxford University, Rogers co-founded the Quantum Fund, a global-investment partnership with another investing legend George Soros. That portfolio gained 4200%, making Rogers one of the investing billionaires. But then Rogers has the knack of doing things in his own inimitable way. He did the unthinkable when he decided to retire at the age of 37. Since then, he has continued as a private investor, always analysing the global economy and commodities funds and giving investment ideas.

Rogers says his heart has always been passionately focused on two things: commodities and travel. His reason: “You can understand commodities and global economy better only if you travel.” So in 1990-1992, Rogers fulfilled his lifelong travel dream by motorcycling 100,000 miles across six continents, a feat that landed him in the Guinness Book of World Records.

He chronicled his global journey in his bestseller book: Investment Biker. Again, in 1999-2002 Rogers embarked on a Millennium Adventure, traveling for 1,101 days on his round-the-world, Guinness World Record journey, passing through 116 countries, which he recounted in his bestseller book Adventure Capitalist.

His most read book on commodities Hot Commodities was published in 2004. In the book he says 'commodities get no respect'. Here are a few reasons why he thinks they should: commodities are easier to comprehend and study than stocks and behave more rationally since they are subject to the basic laws of supply and demand; they have outperformed many other investment options in recent years; it is foolish to ignore an entire sector of the marketplace; and a bull market is currently under way in commodities a trend that Rogers expects to last for at least a decade longer.

Rogers has been fascinated with China ever since he rode his motorcycle across the country two decades ago, and he has remained a full-fledged China bull for several years. In December last year he published his latest book A Bull in China: How to Invest Profitably in the World's Greatest Market. Rogers continues to remain bullish on China and the China-driven commodities boom that he had predicted almost a decade ago.

He says:
• The Chinese economy's growth rate has averaged 9 per cent since the start of the 1980s.
• China's savings rate is over 35 per cent (in America, it's 2 per cent).
• 40 per cent of China's output goes to exports (so there's no crippling foreign debt).
• $60 billion a year in direct foreign investment, combined with a trade surplus, has brought Beijing's foreign currency reserves to over $1 trillion.
• China's fixed assets ports, bridges, and roads double every two-and-a-half years.

“China will surpass the United States as the world's largest economy in as little as 20 years,” he says.

As one gets into his upmarket apartment and waits for Rogers a little early, he calls from the Singapore University campus, saying he has just finished a lecture on global economy and will be back soon. “Why are you 30 minutes early,” he asks meaning precisely that Rogers is a stickler for time, and he proves that when the legend arrives sharp at 1 pm.

“Let me get out of my academic dress and come to the gym to cycle,” he says as he takes a few issues of Commodity Market magazine and begins reading. “I love anything and everything written on commodities.” And when he comes to the cycle on the gym, he keeps reading the magazine that had a cover story on whether it is bleak future for commodity Futures market in India. “You know, the Indian government has done the most senseless act by deciding to ban Futures trading in a few commodities. It is crazy. How can you rein in inflation in your country by banning the commodity Futures market?” he asks.

His anger is towards the Indian government's decision to ban Futures trading in commodities like wheat, rice, rubber, potato etc in the recent months. High oil prices, inflation, food prices etc have hit countries like India very hard. How should counties like India tackle the situation? “Inflation affects everyone. Not just India. We pay the same price for copper in several countries. India is not getting any worse than other countries. The problem with India is that your politicians are worse than American politicians. You know Indian politicians believe and argue that the cause for inflation is commodities trading. How absurd is that,” Rogers gets furious.

“It is the same tactic that politicians have done for hundreds of years everywhere in the world.” He says the Indian government's decision to ban commodities Futures trading has not done anything good for India and the rest of the world. “Commodity prices are still up and up. India needs to understand that there is no easy solution to high prices. As prices go up, people use less of anything and people would continue to produce more and that has always been there in the boom market.”

But while there is a commodities boom globally, high food prices and inflation have hit the growth rate of many countries. Is he worried? “Yes I am worried. I have been telling this for some years, that America was beginning to be hit with recession, that the oil price would skyrocket, that the US Federal Reserve does not have any idea to tackle the situation.” He says it is just the beginning, and things could get worse.

“Recession, hard times, sliding dollar and inflation…and the US Fed chairman Ben Bernanke's decision to print huge amounts of money does not help the situation,” says Rogers, a long-time critic of the US Fed, adding: “You know the current recession is the worst one that we are witnessing since World War II.” But despite his pessimism for the US economy, his dream for Asia continues. “I am still upbeat on China. The best thing is that the Chinese understood that their market was overheated, and they took action before it got into a bubble. The correction is not yet over in China. But I have plans to invest in Chinese commodities and stocks,” he says.

Rogers, however, is not as fascinated by India, as an investment destination compared to China. “India is a fascinating country with the most diverse culture in the world. For anyone, who wants to travel to any nation, I would first suggest India. But as an investment destination, I would say I would not invest in India for the time being. The Indian market is overheated and overpriced. That is why it has come crashing to these levels these days. And, after all these years, it is really stupid that foreign funds and investors cannot put in money in Indian commodities. Added to the misery of the fact that your government goes on banning Futures trading in commodities,” he says giving a punch line: “India has the most beautiful women and the worst bureaucrats and politicians in the world.”

The high oil prices and the pull back in some commodity prices on recession fears have not dampened Rogers' enthusiasm for resources investments. “I am very bullish on metals and precious metals. Crude oil price will continue to rise, because there is a major demand-supply mismatch. Those who blame speculators for high oil prices do not know how the Futures market and oil market operate.” Rogers is also upbeat on agricultural commodities. “I am bullish on opportunities in the agricultural commodities market. I am investing there now. The secular bull market in commodities will continue to go on now for some years,” he adds. •

This article appeared in COMMODITY MARKET, India’s No 1 news magazine on commodities