Jim Rogers(JR)'s advise with reference to the pound and the UK economy pushed the country deeper into its financial gloom. With a very troubled housing and financial service sector, JR's statements push the already nervous investors over the edge. In fact, the advise spark a Sterling sell-off resulting it sitting at a 23 year low against the USD and an all-time low against the Yen. Questions have emerged whether the UK will be able to ride out this financial storm and how soon or earned the reputation as being the second European Union country after Iceland to fail in this crisis. Are the fundamentals of the UK that weak? Will the RBS, Lloyds and Barclays be nationalised soon? Will the country be able to retain its AAA ratings? Will pound near parity with the USD? Will the London Olympics 2012's projects get stuck? One thing I am sure, despite all this, the country will still have their famous football clubs and pubs, just to name a few.FT.com: The pound is a currency with no underpinning and should fall against the dollar and the euro, says Jim Rogers, chairman of Rogers Holdings and co-founder of the Quantum Fund with George Soros.
He says his view reflects the UK’s dire economic situation: “It’s simple, the UK has nothing to sell.”
Mr Rogers says the two main pillars of support for sterling have been North Sea oil and the strength of the UK financial services sector, in particular, the City of London’s role.
He says his view reflects the UK’s dire economic situation: “It’s simple, the UK has nothing to sell.”
Mr Rogers says the two main pillars of support for sterling have been North Sea oil and the strength of the UK financial services sector, in particular, the City of London’s role.
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But Mr Rogers says just as North Sea oil is running out, so London’s standing as a major financial centre is set to suffer.
“I don’t think there is a sound UK bank now, at least, if there is one I don’t know about it,” he says.
“The City of London is finished, the financial centre of the world is moving east.”
“All the money is in Asia. Why would it go back to the West? You don’t need London,” says Mr Rogers.
Mr Rogers thinks the pound is more vulnerable than the dollar or the euro.
He says the UK housing market is arguably in a worse state than that of the US, given pockets of strength in the US and prices that are sliding across the board in the UK.
Meanwhile, he says, the UK is in worse shape economically than the eurozone, where most countries are not big debtors and do not run huge trade deficits.
“If the UK discovers more North Sea oil, I might change this view,” he says. “But I don’t see that happening.”
“I don’t think there is a sound UK bank now, at least, if there is one I don’t know about it,” he says.
“The City of London is finished, the financial centre of the world is moving east.”
“All the money is in Asia. Why would it go back to the West? You don’t need London,” says Mr Rogers.
Mr Rogers thinks the pound is more vulnerable than the dollar or the euro.
He says the UK housing market is arguably in a worse state than that of the US, given pockets of strength in the US and prices that are sliding across the board in the UK.
Meanwhile, he says, the UK is in worse shape economically than the eurozone, where most countries are not big debtors and do not run huge trade deficits.
“If the UK discovers more North Sea oil, I might change this view,” he says. “But I don’t see that happening.”
* China's economy grew 6.8% in the 4Q; slowest in 7 years. For the year, the economy grew 9% in 2008.
* South Korea's economy shrank 5.6% in the 4Q.
* BNM has lowered its key interest rate by 75 basis point to 2.5% yesterday. Pretty sharp and desperate?
* Japan keeps its key interest rate at 0.1%.
* Come July 6, KLCI will be replaced and be known as FTSE Bursa Malaysia KLCI (30 largest main board companies based on investable market capitalisation. We will have a tough time getting used to it!
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