Friday, June 19, 2009

Fund managers should become farmers??

A very interesting interview with Jim Rogers in the Economic Times. It was like he was saying whatever I have been saying/feeling. There are two excerpts below. The full article is here:

He touches upon two of my other thoughts - the coming commodities boom due to its finite availability and the collapse of the US dollar.

Global population is close to its peak and genetically-modified crops will increase productivity. What makes you so bullish on agriculture?

It doesn't matter. The world has been consuming more than it produced. Food inventories are at a multi-decade low. And we haven't had any bad weather. We had isolated cases of droughts and things. That may never happen again. But if it does, the prices of food would go through the roof.

If there is climate change taking place, the best way to participate is through agriculture or through agriculture products. There are many positive things happening. Right now, there is a shortage of everything in agriculture — seeds, fertilisers, tractors, tractor tyres. We have a shortage of farmers because farming has been a horrible business for the past 30 years.

What will you tell a confused fund manager who seeks your advice?

Become a farmer. The world has tens of thousands of hotshot fund managers right now. If I am correct, the financial community is not going to be a great place to be in for the next 30 years. We have many periods in history when financial people were in charge, we had many periods when people who produced real goods were in charge — miners, farmers, etc.

The world, in my view, is changing and is shifting away from the financial types to producers of real goods, and this is going to last for several decades as it always has. This may sound strange but it always happens this way. Ten years from now, it may be farmers who will drive the Lamborghinis and the stock brokers will drive tractors or taxis at best.

P.S. Two posts in a row... the reason is that I am thinking these days I need to write my thoughts down more - to organize and to not forget :-) - memory is failing!


Uma said...

It is difficult to sit down and write the blog - I know... One way to put your thoughts into words there and then is Twitter; another, nicer way (acc to me) is to put them up as your status update on Facebook. That is bound to generate a discussion...

I don't like your Jim Rogers if he supports GM food. I don't want to go into the controversy regarding safety issues of GM food. My opposition to GM food is based more on principle than on practical safety issues. I believe it is ‘unnecessary technology’ – something that was started because it was new, exciting, and possible – something that made man feel like God. Then a market was developed for it, and it was touted as the answer to the world’s food problems. How can such an expensive technology, whose results are so unpredictable, whose long – term effects are unknown, make such large claims? And what of agriculture itself – the traditional livelihood practice of millions – how will it survive corporatisation? GM food can never be the answer to growing food needs of the world - like nuclear power, it will be an issue whose supposed benefits are more talked about than actually experienced...

Anand said...

Well, I don't like GM food either, and agree with you completely!

But I think we can give room for him to have opinions of all kinds - not all of which we might agree with :-)