The Most Important Difference of Opinion in the World Right Now: Faber vs. Rogers on China & Commodity Prices

Marc Faber, Jim Rogers Clash Over China and Commodities, Agree on Gold

Investment gurus Jim Rogers and Marc Faber agree to various degrees on many issues but the one thing separating them this week is the future direction of the Chinese economy and if this could have a devastating impact on commodities around the world

Marc Faber, Jim Rogers Clash Over China and Commodities, Agree on Gold

Marc Faber, the Swiss fund manager and Gloom Boom & Doom editor, believes a Chinese slowdown is already under way. In a phone interview with CNBC Friday, he said that a hard landing for China will have a major negative impact on global commodities and risk currencies, before going as far as saying that he is "more worried about a Chinese economic downturn than a recession in Europe". For his part, legendary global investor and chairman of Singapore- based Rogers Holdings, Jim Rogers thinks Faber has got it wrong about China. "Marc still does not understand China. There are going to be several hard landings in the next few years, but China’s will be less hard overall than others such as Greece, U.S..." Rogers told CNBC Friday.

Marc Faber, Jim Rogers Clash Over China and Commodities, Agree on Gold

according to Faber. "I think a lot of people will care if china grows only at 5% rather than 10% or 0% in a hard landing case because china is the largest buyer of commodities in the world," he said. "If the Chinese economy slows down the demand for commodities slows down and then the economies of brazil, Argentina, everybody is affected and then they can buy less from china and then you have a downward spiral, Faber added. Rogers agrees the commodity market will have a correction, but rebutted Faber's view that it would be devastating. "Yes, there will be consolidations in the commodity bull market just as all markets have consolidations," he said. "In 1987, stocks declined 40%-80% worldwide, but it was not the end of the secular bull market in stocks." "If I was always bullish about commodities and completely missed out on the crash in 2008, then obviously, having tied essentially my reputation to commodities, I'd continue to be bullish," Faber had earlier said about Rogers' view on commodities. "I proclaimed repeatedly far and wide that one should not buy commodities in the run up phase", replied Rogers. "I also explained that I was not selling mine since we were [and are] in a secular bull market," Rogers stressed.

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