Jim Rogers advises Gulf states to get rid of dollar peg
Source: BI-ME and Bloomberg , Author: BI-ME staff
Posted: Tue February 17, 2009 12:00 am
china wholesale market

UAE. The Gulf countries' currency peg to the dollar is a 'terrible mistake' and will cause problems for the region as the US currency is expected to decline, Jim Rogers said.

The six Gulf Cooperation Council states should form a joint currency as soon as possible, the chairman of Singapore-based Rogers Holdings said at a conference in Dubai Monday.

The new currency shouldn’t be linked to any other as the region has enough foreign reserves and oil to back it up.

“You’ve got good foreign exchange reserves and a lot of oil” to back a common currency, Rogers said during a banking conference in Dubai.

Saudi Arabia, Kuwait, Bahrain, Qatar, the United Arab Emirates and Oman agreed in 2001 to form a European Union-style monetary union by 2010 to boost regional trade. Oman later pulled out.

Kuwait is the only Gulf Arab state to have dropped its currency peg to the dollar, giving it some control over monetary policy.

Gulf Arab leaders in December approved an agreement to create a central bank and single currency for the region to boost trade and strengthen monetary policy.

A single currency would allow the Gulf states to stop pegging their currencies to the dollar and implement independent monetary policy.

Rogers said the dollar will suffer because the US government’s bailout plans and the economic stimulus will increase the US debt, weakening the US currency.

“I plan to sell all my US dollars,” he said. “The Federal Reserve will continue to print money, and this will destroy any credibility associated with the US dollar.”

In a previous interview Rogers said the dollar is "going to lose its status as the world's reserve currency. It will be devalued and it will go down a lot. These guys in Washington, they want to debase the currency."

"They think that if you drive down the value of your money, it makes you more competitive, now that has never worked in history in the long term," said Rogers

Rogers has spent a career being one step ahead of mainstream investment thinking.  Amongst his many accomplishments, Rogers was co-founder with George Soros of Quantum Fund. During his ten years with the fund, the portfolio gained more than 4,000%, while the S&P rose less than 50%

 

MIDDLE EAST BUSINESS COMMENT & ANALYSIS

date:Posted: August 31, 2015
UAE. Phidar Advisory's latest residential research note finds prices continue to decline; Key currencies are the Indian Rupee, British Pound and Pakistani Rupee; "Currency trends may help us understand and forecast local property prices," says Jesse Downs.
date:Posted: August 31, 2015
UAE. "It'll take some time before China adjusts to a more stable growth path. So, this sort of volatility will be with us for a while and perhaps worse," according to Linda Yueh, Adjunct Professor of Economics, London Business School.
date:Posted: August 30, 2015
INTERNATIONAL. Commodities have fallen to the lowest level in 16 years thereby wiping out all the gains that were made during the Chinese boom years during the first decade of this millennium.
UAE. Phidar Advisory's latest residential research note finds prices continue to decline; Key currencies are the Indian Rupee, British Pound and Pakistani Rupee; "Currency trends may help us understand and forecast local property prices," says Jesse Downs.
dhgate