Jim Rogers: 'Abolish the Fed'

[IBC]

Jim Rogers: 'Abolish the Fed'
INTEREST RATES, FED, BEN BERNANKE, JIM ROGERS, FEDERAL RESERVE, WEAK DOLLAR, INFLATION
By CNBC.com
CNBC.com
| 12 Mar 2008 | 09:54 AM ET

Federal Reserve Chairman Ben Bernanke should resign and the Fed should be abolished as a way to boost the falling dollar and speed up the recovery of the U.S. economy, investor Jim Rogers, CEO of Rogers Holdings, told CNBC Europe Wednesday.

Asked what he would do if he were in Bernanke's shoes, Rogers, who slammed the Fed for pouring liquidity in the system and accepting mortgage-backed securities as guarantees, said: "I would abolish the Federal Reserve and I would resign."

If this happened, "we don't have anybody printing money, we don't have inflation in the land, we don't have a collapsing U.S. dollar," he told "Squawk Box Europe."

The Federal Reserve announced on Wednesday a rescue package that it would put around $200 billion into banks and investment houses and allow them to put up risky home-loan packages as collateral.

Wall Street responded to the news with the biggest rally of the year, but Rogers reminisced of the 1970s, when the Fed printed money to avert a recession, boosting inflation and then forcing interest rates to more than 20 percent to keep a lid on price rises.

"No country in the world has ever succeeded by debasing its currency," he said. "That's what this man is trying to do. He's trying to debase the currency as a way to revive America. It has never worked in the long term or the medium term."

'Socialism for the Rich'

The Fed's move to accept risky collateral is not part of the central bank's business, he added.

"What is Bernanke going to do? Get in his helicopter and fly around the world and collect rents? That's absurd," Rogers said.

A recession may be a good way to clean up the economy, while trying to prevent one may cost more and actually worsen the recession, Rogers said. Also, investment banks should be allowed to fail.

"Listen, investment banks have been going bankrupt since the beginning of time. If people make mistakes -- if you bail out every investment bank that gets in trouble, that's not capitalism, that's socialism for the rich," he said.

The weakest financial institution is Fannie Mae, in Rogers' opinion, "but all of them have problems."

He said he had a short position on all investment banks and is buying agricultural commodities such as cotton, wheat, coffee and sugar and was also buying the Chinese yuan and the Japanese yen.

"Buy agriculture. Agriculture is one of the few places where you're going to make a fortune in the next years," Rogers said.
© 2008 CNBC.com

URL: http://www.cnbc.com/id/23588079/site/14081545/

[Jiddy78]

"Listen, investment banks have been going bankrupt since the beginning of time. If people make mistakes -- if you bail out every investment bank that gets in trouble, that's not capitalism, that's socialism for the rich," he said.

Are you emphasizing this statement because you agree with it?

[IBC]

Are you emphasizing this statement because you agree with it?

I found it very interesting, and knew it would be fodder for discussion so I emphasized it. Kind of like the old corporate welfare argument.

[Jiddy78]

I found it very interesting, and knew it would be fodder for discussion so I emphasized it. Kind of like the old corporate welfare argument.

I disagree with the "for the rich" part of the statement. How could the government bailing out entities that allowed anyone that signed a name on a piece of paper to have a stucco sh*tbox be considered "for the rich?" I'd say socialism for the irresponsible....which is a good amount of people in the country...but hey...That's what the Babylonian whores want...Easy money. The banks, as well as the government, are a pure representation. Many are unwilling to own up this this. Easy to do when 99% of households have multiple TV's and widescreens and computers are as common as toilets.

[IBC]

I disagree with the "for the rich" part of the statement. How could the government bailing out entities that allowed anyone that signed a name on a piece of paper to have a stucco sh*tbox be considered "for the rich?" I'd say socialism for the irresponsible....which is a good amount of people in the country...but hey...That's what the Babylonian whores want...Easy money. The banks, as well as the government, are a pure representation. Many are unwilling to own up this this. Easy to do when 99% of households have multiple TV's and widescreens and computers are as common as toilets.

YESSSSS!!!!!!!!!!!!!!!! He shoots, he scores! My daily goal shall forever be to try and get you to say Babylonian whores once a day.

I find an amazing amount of ridiculousness of people that are totally for tax breaks and handouts to corporations, but totally against social welfare programs. I suppose that is where I come from on an issue like this. Therefore, I don't have a lot of problems with helping people in dire need because of the economy or housing crisis. However bailing people out doesn't exactly encourage responsibility either, and some just don't deserve anything. For example, if you were buying houses as investments or trying to flip them. Screw those people. I am a bit torn I suppose. I do know the answer isn't bailing out these asshole companies either.

It is a shame, that as unemployment and poverty rise, as they are now, so does the level of uninsured, uninsured children especially. However, as Bush said:

"The immediate goal is to make sure there are more people on private insurance plans. I mean, people have access to health care in America," he said. "After all, you just go to an emergency room."

Good point George. Just go to an emergency room.

[Jiddy78]

I find an amazing amount of ridiculousness of people that are totally for tax breaks and handouts to corporations, but totally against social welfare programs. I suppose that is where I come from on an issue like this. Therefore, I don't have a lot of problems with helping people in dire need because of the economy or housing crisis. However bailing people out doesn't exactly encourage responsibility either, and some just don't deserve anything. For example, if you were buying houses as investments or trying to flip them. Screw those people. I am a bit torn I suppose. I do know the answer isn't bailing out these asshole companies either.



People that feel that way want more money funneled to the people in terms of work, rather than money funneled in terms of.....nothing. The problem is that corporations do not funnel fairly because they run the premises of their companies on a secondary, indirect and completely corruptible market. The exposure of such has been grandstanded for quite some time. Yet most turn a blind eye...because of the aforementioned quality living terms. So long as things are good...No change will be made in doling out things in a fairer manner. Problem is, when we get to that point, that won't be accomplished at the terms of the passive folk...It will be accomplished at the end of a weapon.

There's some merit to the "Be careful what you wish for" crowd....but I refuse to accept their definition of our paradigm. It's a horsesh*t paradigm and they know it.

[KinjaKahn]

"The central bank is an institution of the most deadly hostility existing against the Principles and form of our Constitution.....If the American People allow private banks to control the issuance of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the People of all their Property until their Children will wake up homeless on the continent their Fathers conquered." - Thomas Jefferson

Nice quote, there are many more concerning the central banking system from many people... including one from Milton Freidman, accusing the "Federal" Reserve of causing the Great Depression. Another cool one from Thomas Edison questioning the need for a private company to print and manage currency while the Government could easily do it without the pitfall of paying interest on the money it has to "borrow" from the "Federal" reserve. If the Government can print and sell bonds... why can't it print dollars?