At the present time, there are numerous conflicts taking place all over the world: in the Middle East and Eastern Europe, many are suffering from the Azerbaijan-Armenian strife, Israel and Palestine are in the midst of a ceasefire, Ukraine and Russia still battling it out and there is a lot of destruction elsewhere in part to United States drones and military actions.
It isn’t a great time to be living on planet Earth right now.
For investors, it’s a quandary: do you buy or sell? Do you enter the market or exit? If you do push ahead, what do you invest in? There are a lot of variables to consider.
According to Jim Rogers, chairman of Rogers Holdings and bestselling author of “Hot Commodities,” in times of war then you purchase gold, oil and other commodities. In an interview with the Economic Times, Rogers posited that war isn’t good for any investment hub except for real assets because it’s needed very much by everyone.
“War is not good for anything except for real assets, because people need real assets during the time of war, whether they are involved in the war or just protecting themselves,” stated Rogers, who has made major plays in commodities.
In terms of gold, Rogers is in the middle because he isn’t a buyer or seller at the moment. “I own gold. I would suspect there will be another chance to buy gold sometime in the next year or two. I am doing nothing at the moment.”
Gold is trading at just under $1,290, while silver has dipped below $20 (at the time of this writing).
When it comes to the Federal Reserve, Rogers believes as the central bank begins to drawdown its monetary stimulus then interest rates will start to increase and stock markets will eventually start to decline as its high from the stimulus begins to wear off.
“Markets will breathe a sigh of relief, they will rally, go up for a while; but unfortunately that may then lead to the last leg of this poor market because rather than staying the course – which central banks have rarely done in the past few decades – they say everything is okay, but things will just get worse,” averred Rogers.
The Fed announced last week that it would decrease its monthly bond purchases by another $10 billion to $25 billion each month. The stock market reacted negatively to this news as the Dow Jones fell more than 300 points. It remains unclear as to when the U.S. central bank will start to raise rates.
It was confirmed Monday that the Fed acquired $1.094 billion of Treasuries maturing Feb. 2036 until Aug. 2043.
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