It is going to take a lot to kill inflation this time: Jim Rogers

“I learned silver from India by the way. The Indians have staggering amounts of silver as you well know and gold. I think India is probably the most important factor in the silver and gold markets anywhere in the world,” says Jim Rogers, Author, Street Smarts: Adventures on the Road and in the Markets.

Now whether it is recession or peak of inflation, some would argue that interest rates globally are nearing its peak at least in the interim. Is it a good time to park cash back to bonds?
Well, cash, it depends on which cash, first of all. You own the wrong currency, you are going to get ruined. I am not buying bonds. I expect interest rates to go higher over the next few years. I mean, you do not remember but in 1980 when we had the last inflation, interest rates on short-term treasury bills in the United States were 21%, that is not a typo. Short-term treasury bills were at 21%. It is going to take a lot to kill inflation this time because inflation is worse now. Not this month, not this week but before this is over interest rates will go much-much higher.

The joker in the pack is that Ukraine and Russia are still at a war. Now, there are two assumptions here. If they continue to remain at war, what impact it will have on inflation and commodities and in the next six months if there is a ceasefire, how will that impact commodity prices and underlying demand?
Very good point. I do not know why this war keeps going. I do not know who is getting anything out of it, neither Russia nor America nor Ukraine, but if it ends or if there is a ceasefire, everything is going to react. Stocks are going to go up a lot, bonds will go up a lot and oil will go down, grains will go down. But what I plan to do, if that happens, is to buy grain and to buy commodities because that will be a buying opportunity.

You have always argued that China’s markets and the Chinese economy they have a lot of inertia going for itself. But last two years if you examine the Chinese stock market, the Chinese administrative policy, the Chinese real estate sector, one is getting a sense that China is peaking out to its growth. What implications do you think that will have on global growth per se?
Well, I get the impression just from reading the press that China has been very restrictive internally for a while but it seems to me that something is changing and that China is now trying to be more open to the outside world. If that happens, it is certainly going to affect the Chinese economy and it is going to affect the worldwide economy. I mean, there has been very little travel in China or out of China for two or three years, the travel industry, tourism everywhere is going to prosper if they really are opening and it is my view that they are opening up more than they were before.

Now if China comes back in full bloom this year, do you think it will have serious implications on demand and commodity prices?
Well, it will add to inflation because whenever there is more demand for something, prices go up and if prices go up, that is called inflation and certainly it will affect metals, it will affect food, it will affect everything. I mean, China is a gigantic. It is the second largest economy in the world, as you know.

Apart from drinking water in a silver cup and stocking silver and gold in your pocket, what else would you recommend our viewers would do, for people who are looking at investing and creating wealth in the medium to long term?
I learned silver from India by the way. The Indians have staggering amounts of silver as you well know and gold. I think India is probably the most important factor in the silver and gold markets anywhere in the world.

I remember we had a conversation and you said that for me it is very simple. I would like to eat rice because I am bullish on commodities. I would like to buy rice and eat it with silver chopsticks, in a silver cup so to speak. Has that habit changed?
Well I still own my silver chopsticks by the way. Again, I learned about silver from India. When I first went to India I found silver and gold everywhere. I learned a lot from India about many things but especially silver and gold. None of that has changed. I am still optimistic because I know that once we have the big rally, inflation is coming back and when inflation comes, if you own the things that go higher in price, you make money. I do not like inflation. Nobody likes inflation, but politicians are not very smart.