Investment Guru Jim Rogers says the Indian stock market has run up a lot. "I won’t buy shares at these levels." He has a similar view on emerging markets, except China.
Though he currently owns Chinese shares, he is a tad negative on the economy. "The Chinese economy needs to cool." He feels real estate in China is getting into a bubble zone.
Usually, experts say that Chinese demand and commodities have a direct correlation. They base their investments on this theory. However, Rogers stated that China does not control the commodity market.
According to him, gold is the best investment these days as it is near all-time highs. "I will buy if it drops to USD 1,000 per ounce."
Crude is a strict no-no for the investment guru at current levels but is confident that it will see triple-digit prices soon.
So, where should you park your money? Commodities and real estate, he says, is the best place to be in right now
Here is a verbatim transcript of an exclusive interview with Jim Rogers on CNBC-TV18. Also watch the accompanying video.
Q: How have you read the Chinese action off late? Do you think it has the potential of stalling this strong commodity rally?
A: I am delighted to see what China did because some of the real estate in China was getting into a serious bubble. It’s good for China and therefore good for most of us. They need to cool off their economy. They cannot get it too strong but China does not control the commodities market by any stretch of the imagination.
The Chinese economy as strong as it is about one-tenth of the size of America and Europe. Hence, we need China but that is not going to set the pace.
Q: Do you agree with people or commentators who believe there are many bubbles which are already forming in the commodity space because of the liquidity injection or do you think we are nowhere close to that?
A: Gold made an all time high recently but everything else is still very depressed compared to its all time high. What kind of bubble are you talking about? Name one commodity that is in a bubble and all time high except gold.
Q: There has been a big resurgence in trading interest in crude as well, for 2010 would that be a commodity to watch?
A: I own crude. I don’t think I would buy it right now. It’s gone up a lot in the last 12 months. I own all commodities. They are the best place to be. If the world economy gets better, commodities are going to lead the way because there are shortages developing in most commodities.
Jim Rogers has taught finance at Columbia University’s business school and is a media commentator worldwide. He is the author of Adventure Capitalist, Investment Biker, Hot Commodities, A Gift to My Children, and A Bull in China. See his website.