The relentless rally in stocks seems unstoppable, with the S&P 500 soaring 21% this year alone and a staggering 87% over the past five years. While these gains have propelled many portfolios into the green, veteran investor Jim Rogers said he is deeply concerned.
“Nearly every stock market in the world has had an all-time high, or near an all-time high,” he told Wealthion in a recent interview, warning that when everyone is making profits, “somebody better look out the window and get worried.”
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Earlier this year, reports showed that 14 of the world’s 20 largest stock markets hit record highs. According to Rogers, “just about everybody in the world has joined in now.”
Rogers’ caution is rooted in experience, as he said he understands what follows market euphoria. “I’ve been around long enough, or have read enough to know that when everybody is making a lot of money and piling in, it usually means things are going to go bad soon,” he admitted.
Rogers has indeed navigated his share of turbulent times. He co-founded the Quantum Fund with George Soros in 1973, right in the middle of a devastating bear market. Between then and 1980, the portfolio returned 4,200%, while the S&P 500 rose only 47%.
Rogers isn’t joining the global stock market euphoria. As he told Wealthion, “I have sold my shares in most countries in the world.”
But he hasn’t sold everything.
“I’m still long Uzbekistan, and I would hope I will buy more Uzbekistan. I still am long China,” he said.
This aligns with Rogers’ long-standing belief in Asia’s growth potential. He underscored this sentiment, asserting, “Whether we like it or not, the 21st century is going to be the century of Asia.”
Given Rogers’ cautious outlook on the markets, it’s no surprise he’s turning to safe-haven assets like gold and silver.
“I know from history that the world is going to have problems again … and when the world has problems… it’s nice to have some gold in the closet, or under the bed, have some silver in the closet,” he said. “Because no matter what, many people will turn to gold and silver in times of turmoil.”
Gold and silver have long been considered popular hedges against inflation. Unlike fiat currency, these metals cannot be printed in unlimited quantities by central banks. As Rogers pointed out, investors often look to these metals for stability and reliability during market volatility or global instability, as their value isn’t tied to any specific currency or economy.
Both metals have surged in 2024: gold is up 34%, surpassing $2,700 per ounce, while silver gained even more, rising 42% to $32.76 per ounce. Rogers has a particular preference for silver, explaining that “silver is still down 40% or 50% from its all-time high,” whereas gold is already at record levels.
Nonetheless, he remains bullish on both.
“I hope I’m smart enough to never sell my gold and silver. I hope I’m smart enough to buy more in the future,” he said.
Today, there are many ways to gain exposure to gold and silver, including owning bullion, buying shares of precious metals, mining companies or ETFs, or even tapping into potential tax advantages with a gold IRA.
One question raised by a listener to the interview was about the best way to invest in agriculture.
“The best way is to become a farmer,” he said, adding that if you’re up for the hard work, you can make an absolute fortune from working outdoors, getting dirty and putting in long hours under the sun.
Rogers also highlighted the benefits of owning farmland, noting that it “will go up a lot in price.” There are many ways to invest in farmland — even if you know nothing about farming.
Additionally, he pointed to agricultural companies as investment options, mentioning industry giants like John Deere, as well as fertilizer and seed companies.
For those with expertise, Rogers suggested commodity futures, saying, “If you can buy cotton futures at the right price or wheat futures at the right time, oh my gosh, you’ll be unbelievably rich. You could get rich in two hours if you get the timing right — you can also get bankrupt in two hours if you get the timing wrong.”
Indeed, futures can be a high-risk, high-reward investment. Due to leverage, investors can control large amounts of commodities with a relatively small initial capital outlay, amplifying both potential gains and losses. This leverage means that even minor price movements can result in substantial profits or losses, making it essential for traders to have a solid grasp of market trends and a clear risk management strategy.
Ultimately, everyone’s financial situation and investment goals differ, so it’s important to consider personal risk tolerance and objectives. With the complexity of today’s financial landscape, you might want to consult a financial advisor who can help you develop a strategy tailored to your unique needs.
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
