Should investors prepare for all major governments debasing their currencies?
''This is the first time in recorded history that we have all the major central banks, all the major governments actively debasing their currencies. Japan has said it will print unlimited amounts of money. So Ben Bernanke said, 'Wait a minute, we can throw in a trillion dollars a year.' And the Europeans said they'll do 'whatever it takes.' There's a gigantic ocean of liquidity, and the people getting that liquidity are having a wonderful time. But it's totally artificial, and it's going to end badly when it ends, I assure you.
Can't such policies go on for a while? After all, we still don't have inflation . . .
According to the U.S. government! But you must buy some things: insurance, food, even paper. The price of nearly everything is going up. We have inflation in India, China, Norway, Australia -- everywhere but the U.S. Bureau of Labor Statistics.
I'm telling you they're lying. Go to a restaurant in New York, or a grocery store, and tell me that there's no inflation. [Rogers starts tapping on his laptop]. Look here: In 2001, it cost $9 to go to the top of the Empire State Building. Now it's $27 to go to the 86th floor, $44 to go to the top, and $67 to go express. The Museum of Modern Art in 2001 was $10, now it's $25. A cab from Kennedy airport to Manhattan in 2001 was $30 plus tolls. Now it starts at $52.
Should the market be near record highs? Or has it run ahead of the economy?
Staggering amounts of money being printed has to go somewhere, and it frequently goes into financial markets. But the advance is getting narrower. Fewer and fewer big stocks are going up, which is what happened near the end of the last bubble in 1999. Now, I don't know how long this will go on, but it can't go on forever. That said, you can't really short this market either.''