Tuesday, March 9, 2010

Forget Gold. Look To Commodities Etfs, Agriculture And Lead Instead. (VIDEO)

Famed investor and best-selling author Jim Rogers was interviewed by Yahoo!'s Tech Ticker back in October 2009, and he's still bullish on commodities, but not so much on gold. Here's the 30-second takeaway from the video:

  • Individual investors should focus on commodity ETFs, unless they have a deep understanding and interest in commodities futures trading.

  • Forget gold, and invest in other material instead like lead, zinc, copper and silver.

  • Agriculture is the next big crisis, with the Food and Agriculture Organization warning countries that the world is one disaster away from a major food shortage in much of the world.

  • "I think I'll make money in other commodities that are more useful."

Rogers owns gold, but he not very bullish on it. I think his argument against gold is a good one. He basically thinks that it has some intrinsic value, but only from a subjective point of view. It simply isn't as practical a metal as lead, zinc or silver. And because gold "is mystical to many people", it's garnered the lions share of attention, but that also means there's less upside potential than there is in more over looked, less attractive metals.

"most agricultural products are still depressed on a historic basis."

Speaking of useful commodities, Rogers is quite bullish on agricultural commodities. Rogers sees a vast lack of supply, and calls it a looming catastrophe. He thinks that the world is in for a period ahead when some parts of the globe won't be able to get food at any price.

"The story is not over, not for a while. I don't see any reason it's going to be over for a few years because no one is bringing new supply on stream."

Is Jim Rogers right?

Who knows? But he was right when he called a global commodities rally in 1999. And he presents sensible arguments to support his views on various commodities, which is more than I can say for many of the gold pushers that have been crawling out of the woodwork in the past 3-5 years.


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