Hedge Against Collapse
Jim Rogers is quite well-known in the investment world for making wise decisions and sticking to them. Now, he’s taken a route that has created a great deal of buzz.
Rogers has taken a rather dramatic left turns as of late, seemingly buying up all the North Korean gold he can. According to the Wall Street Journal, Rogers recently visited a coin fair in Singapore, purchasing 13 rare coins from North Korea.
The reasoning behind Rogers’ decision appears rather harsh to certain people, as it is indeed quite frank. Rogers stated in an interview recently that he believes North Korea will eventually cease to be a country, which will dramatically increase the value of the gold coins.
Anyone who has paid even a remote amount of attention to the news lately knows that this is a very volatile time to be embarking in any relations with North Korea. The country has made threats in recent months and weeks to carry out a nuclear attack on America, raising concerns not only among American citizens and others throughout the world, but among government officials as well.
In many ways, some feel as if Rogers is actually helping to support the nation of North Korea as a result of his interest in purchasing gold coins from the country. Whether directly or indirectly, the purchase of such coins could potentially help to finance the government of North Korea.
Because of the large amount of strife in the air at the moment, this isn’t necessarily going over well with investors across the board.
Another aspect of Rogers’ investment that has turned heads in perhaps a negative direction comes from the fact that he is actually betting against the prospect of the nation of North Korea as a whole. It wouldn’t be difficult to surmise that the investments in gold made by Rogers are based upon his predictions that the country will eventually collapse as a nation, which would indicate that Rogers is actually shorting North Korea with his decisions.
According to Business Insider, the 13 gold coins purchased by Rogers were worth $2,014 per piece.
The idea of investing in gold, silver, and other alternative forms of currency has been extremely popular as of late. The bailout scenario in Cyprus has caused investors everywhere to start thinking more about how their money is handled and where it is stored, which has proved to show an increase in the interest in gold and other precious metals.
It’s safe to say that Rogers’ decision to purchase North Korean gold is quite timely, and even if he did so just because he feels as if he’s shorting the country, the purchase would tie in quite well with events happening globally.
Gold and silver are not the only forms of currency that investors are looking towards. Bitcoin, a new form of decentralized online currency, has seen a great deal of progress and popularity in recent months. A single bitcoin cost $.05 in 2011, and today the numbers are rising above $130; one of the most impressive inflation bubbles in recent financial history.
It should come as no surprise that the interest in Bitcoin is very much associated with the fact that traditional, government-regulated currencies have seen quite a bit of instability recently. The Cyprus bailout may have been a major catalyst, but the euro has struggled for a fair amount of time and is likely to continue doing so throughout the first half of 2013.
It’s no secret that Rogers’ decision to invest in North Korean gold is controversial, but it’s difficult to get around the fact that what he is doing should not come as much of a surprise to most people. The volatile global economic climate has caused savvy investors the world over to put more stock in where their wealth is stored, and the push towards gold, silver and other commodities is increasing at an alarming rate.
Rogers’ decisions may be fairly unorthodox, but to be fully shocked would mean one is simply not paying attention to what’s going on in the world today.
Time will tell whether or not Rogers’ predictions about the fate of North Korea will come true, but for now we’re left with an interesting glimpse into his current views on smart investing.
By William Meader
Friday, April 5th, 2013 – Wealth Daily