Defenestrating Thoughts from the Bivouac

This is a great clip of Jim Rogers sharing his thoughts about the economy and how to invest to protect your wealth.

Some of highlights:

• Why would you listen to Bernanke, Bush, and Paulson? They have been wrong over and over and over.
• He is still buying gold, regardless of if it is going up or down. It’s a great inflation hedge.
• He’s buying agricultural commodities, farms, oil, and energy companies.
• He’s shorting long term US treasuries.

He’s a smart guy and one of the few that predicted this crash. I completely agree with him that this downward swing is a great buying opportunity.

He said one thing that I’m still trying to wrap my head around: you’ll know we’re at the bottom when the market goes up on bad news.

I think that he’s referring to the fact that news lags fundamental market shifts. As this crash started, the “good news” was still coming in and most people didn’t grasp what was happening. For for the recovery, we need to watch for the market going up, even though news is bad and people are still thinking it’s going down.

First of all, a lot of news and indicators are backwards looking. Unemployment numbers are never for today, they are for last month. Likewise, with sales, revenue, and inventory numbers.

Second, the mainstream (especially the media) is always slow on the uptake.

We just need to get out ahead of the crowd and then we’ll know when to jump back in the market. :-)