- Rising debt burdens created this economic mess, so bailouts funded by additional debt only augment the problem.
- Intermarket analysis suggests risk-off money flows. Negative divergences and weakening trend increases the probability of a sharp decline if confidence breaks.
- If confidence breaks, oil will head lower. I expect the invisible hand to accumulate any sharp decline (see chart).
Headline: Jim Rogers: Short Stocks, Go Long Oil
His strategy in the event of a global selloff: Sell short. "I’m not advocating because I’m short, but I’m short because I think there are going to be more problems in the world economy in the next year or two. That’s how you protect yourself in times like this," he said. "What they’re doing is they’re making this situation worse." Why? Because bailouts and printing money only add to the debt burden, Rogers said. "What I see happening is more and more bailouts, higher and higher and higher debt," he said. "We’re going to have a worse recession next year and 2014 because the debt is high. ... In 2007 and 2008, the recession was worse because the debt was higher; 2013 and 2014, the debt is up to the ceiling. The recession is going to be worse. This is not going to be fun."Source: cnbc.com
Video: Jim Rogers: Let Spain, Greece Go Bankrupt
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