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Why Jim Rogers is buying what everyone else is selling

Veteran investor likes China, Japan, Russia markets

Jim Rogers, chairman of Rogers Holdings.

‘We are destroying the people who save and invest for the future.’

Jim Rogers, cofounder with George Soros of the Quantum Fund and author of the best-selling “Investment Biker,” which chronicled his investing-focused trek around the world by motorcycle, recently shared his views on global markets in a wide-ranging interview.

Since 2008 (when Rogers warned me that the stock market was going to crash), I have never heard him sound so ominous about U.S. stocks and global markets in general.

Read what Rogers has to say about U.S. markets. Then, read on for his views on gold, bonds, Greece, Japan, and China:

Sincere: So these are unusual times?

Rogers: What is happening right now is a historical anomaly. Never in the thousands of years of recorded history have we had interest rates at zero or negative. We are destroying the people who save and invest for the future. They are being wiped out at the expense of the people who bought four or five houses with no money down and no job. We are destroying the people that all societies throughout history have needed the most.

When you destroy the investing and saving group, your society, economy, and country has problems. That is what we have been doing. Think of all those people who were saving for the future. They look like fools now, and feel like fools. Their friends who borrowed money are being saved at their expense.

Is the bond market in a bubble?

Whether it’s a bubble or not we will find out one day, but it probably is. For the stock market to go down, something has to happen, and it could happen if the bond market scares the socks off everyone. The previous bear market in bonds was from 1946 to 1981. Since 1981, the bond market has been in a bull market. When bonds start going lower, and rates go higher, rates will go much, much higher. Interest rates go to levels we cannot conceive right now. I cannot tell you how high interest rates could go but in 1981 U.S. government bonds were at 15%. Right now, there is inflation, but the U.S. Bureau of Labor Statistics say there is no inflation. I don’t know where they go to shop, or where they send their kids to school, or go to baseball games. There is inflation all over the world, not just in the U.S.

‘The only thing that works is when people fail, go bankrupt, and start over.’

Write this down for June 2015: This low interest rate environment will not continue forever. Bonds could go down for a long time, which will scare the bureaucrats in the central banks. This is why we might have a 10% to 13% decline in stocks.