As global commodities prices plummet, it’s incredibly convenient to pronounce the commodities super-cycle dead, isn’t it?
Yet banks from Goldman Sachs to Citigroup to Deutsche Bank are on record as saying it’s over.
The Rogers Commodities Index, which represents the value of a basket of 36 commodity futures contracts, is down 20% since mid-June.
But does incredible opportunity lie among the carnage?
Well, I asked the Founder of the Index, celebrated hedge fund manager and bestselling author, Jim Rogers.
Jim was born just a stone’s throw away from Wall Street Daily’sheadquarters in Baltimore, Maryland, and I get smarter every time I speak to him.
Interview Transcript
Robert Williams: Hi, there. Robert Williams here. I’m grateful to have as my guest today, Co-Founder of the Quantum Fund and bestselling author, Jim Rogers. Jim is a man whose opinion I hold in the highest regard, so I try to have him on at least once per quarter so he can share his wisdom directly with our readers. Welcome to Wall Street Daily, Jim.
Jim Rogers: I’m delighted to be here. Are you kidding? This is fun.
Robert Williams: Jim, let’s start with the commodities super-cycle. I’m hearing a lot of chatter that it’s over. Of course, that’s a convenient argument to make while prices are falling, right? I know you don’t agree, but tell us why.
Jim Rogers: Well, I don’t. I certainly see that. I hear and read the same thing you do, and to me, I’m delighted to see it because it’s the kind of talk that you hear – you don’t hear it at tops. You hear it at bottoms. Whether this is a bottom or not, I have no idea. I do know that I don’t see enough new production, permanent new production, coming online to change the supply/demand dynamic over any longer period of time.
As you know, all the major oil fields in the world are in decline, except for the shale boom in the United States. But everything else has declining reserves and we still aren’t replacing those fields anywhere else. Likewise, with agriculture, I mean the average age of farmers in America is 58. In Japan, it’s 66. In Canada, it’s the oldest in recorded history. In Australia, it’s 58.
