Jim Rogers Expects 'Worst Bear Market in My Lifetime' in Coming Years

(Bloomberg) -- As global stocks attempt to recover from their biggest quarterly loss since the global financial crisis, veteran investor Jim Rogers says there's worse to come.

The current rebound in markets may continue for a while following a bout of extreme pessimism, but another rout is imminent, according to the chairman of Rogers Holdings Inc. That's because of a triple whammy of coronavirus-fulled economic damage, high debt levels and interest rates that are low, which will hurt when they rise.

"I expect in the next couple of years we're going to have the worst bear market in my lifetime," Rogers said in a phone interview.

Stocks plummeted in the first three months of the year as worries about an all but certain recession swept through markets. A global gauge of emerging- and developed-world equities posted its worst quarter since 2008, even as governments worldwide pumped trillions to prop up economies and central banks undertook emergency interest-rate cuts.

This is not the first time he shared such bearish views. Rogers, who co-founded the Quantum Fund with George Soros in the 1970s, had said a bear market was imminent back in 2018. His concerns have grown since, as the debt of businesses afflicted by lockdowns and travel bans comes under the the spotlight.

The impact of the virus on economies "will not be over quickly because there's been a lot of damage. A gigantic amount of debt has been added," he said.

Read more: Virus Sell-Off Opens Up Discount Quality Names

Rogers is not surprised by the recent flight to quality, saying it's a "tried and true" function of markets in distress. "There is absolutely no question that throughout history, when you've had bear markets, companies with low debt are the ones that people love the most because they don't have to worry about bankruptcy," he said.

He noted companies with a strong market share also tend to emerge relatively unscathed, unless they are highly leveraged. For now, he has "a lot of cash" in U.S. dollars, some Chinese and Russian stocks, and he is considering investing in Japanese equities. The executive said he's waiting to snap up shares in some of the most beaten-down sectors such as tourism, transportation, airlines and agriculture in China and globally.

Read more: As Rest of World Locks Down, China Tries to Get Shoppers Out

"The Chinese economy is opening again, people are going back to work. Factories, restaurants are opening again," he said. "I am looking at life, and life is not such that we are all going to take the bus and take boats again."

For more articles like this, please visit us at bloomberg.com

Subscribe now to stay ahead with the most trusted business news source.

©2020 Bloomberg L.P.


More Related News

Costly Electric Vehicles Confront a Harsh Coronavirus Reality
Costly Electric Vehicles Confront a Harsh Coronavirus Reality

(Bloomberg) -- At a factory near Germany's border with the Czech Republic, Volkswagen AG's ambitious strategy to become the global leader in electric vehicles is coming up against the reality of manufacturing during a pandemic.The Zwickau assembly lines, which produce the soon-to-be released ID.3 electric

Chinese Delivery Mogul
Chinese Delivery Mogul's Wealth Doubles to $10 Billion in Months

(Bloomberg) -- Meituan Dianping founder Wang Xing's fortune has nearly doubled since his company emerged from the depths of China's Covid-19 lockdown, cementing his place among a generation of the country's most prominent tech entrepreneurs.Meituan's stock climbed 10.4% on Tuesday after it reported better

Japan's Hottest Stock Is Tiny Maker of $40 Million Machines

(Bloomberg) -- The list of Intel Corp.'s annual supplier award winners tends to read like a who's-who of the semiconductor industry's biggest names. This year, it included a little-known Japanese company whose machines have become indispensable in the race to improve semiconductors and whose stock has been rocketing up as a result.Lasertec Corp. is the world's only maker of testing machines required to verify chip designs for the nascent extreme ultraviolet lithography (or EUV) method of chipmaking. In 2017, Lasertec solved a key piece of the EUV puzzle when it created a machine that can inspect blank EUV masks for internal flaws. Last September, it cleared another milestone by unveiling...

Sanofi to Sell Regeneron Stake Worth About $13 Billion
Sanofi to Sell Regeneron Stake Worth About $13 Billion

(Bloomberg) -- Sanofi is selling a stake in Regeneron Pharmaceuticals Inc. valued at about $13 billion, giving the French drug giant more firepower to invest in fast-growing fields such as cancer.Regeneron has agreed to repurchase $5 billion of its stock from Paris-based Sanofi, the companies said on Monday. Regeneron said that the French company also plans to sell approximately 12.8 million shares, a holding worth more than $7 billion based on Friday's closing price. That will mark the largest public equity offering in the heath-care industry on record.The announcement is part of Sanofi Chief Executive Officer Paul Hudson's revamped strategy. The company said in December that it would...

U.S. Stock Futures Open Flat as Tensions Mount: Markets Wrap
U.S. Stock Futures Open Flat as Tensions Mount: Markets Wrap

(Bloomberg) -- Currency markets and U.S. equity futures saw a placid start to trading early on Monday as traders monitored more signs of economies reopening around the world against a deepening of tensions between the U.S. and China.The Australian dollar and the offshore yuan edged lower, though trading will be light with holidays in the U.S., U.K. and Singapore. The U.S. should give up its "wishful thinking" of changing China, Chinese Foreign Minister Wang Yi said, warning that American leaders are potentially pushing toward a new Cold War. All eyes will be on equities in Hong Kong, where riot police clashed with protesters marching against China's move to crack down on dissent. Stocks...

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply


Top News: Economy