INTERNATIONAL. Legendary global investor and chairman of Singapore-based Rogers Holdings, Jim Rogers said he has been proven right about his criticism of Federal Reserve Chairman Ben Bernanke whom he characterized as "a disaster... doing the wrong thing... and making mistake after mistake after mistake."
Speaking with Betty Liu on Bloomberg Television's "In the Loop" in a discussion including Bethany McLean, a Bloomberg contributing editor, about Dr Bernanke's job performance and policy decisions, Rogers said: I defy you to find a single time in the last six years that he [Dr Bernanke] has been in Washington, where he's been right about anything."
Prompted by Liu suggesting the Fed Chairman has not been proven wrong yet and what he's doing is not necessary bad for the US economy, Rogers replied: "If you are in favor of inflation and a collapsing currency, then of course. Most people would like to live in a country with a sound currency with stable prices and we don't want a housing collapse."
According to McLean there are three categories of Fed critics: 1) the people who are critical of QE2. 2) the people who have been critical of the Fed's policy decisions for a long time on the grounds that the central bank repeatedly blows asset bubbles and then disavow any responsibility. 3) the people who are fundamentally opposed to the Fed on principle and believe we'll be better off with a return to the Gold standard.
"You really have to think of the ideology of where people are coming from when they criticize the Fed - short term criticism of QE2 or a much longer deeper criticism," added McLean.
In reply, Rogers noted that the US has had central banks in its history. “The first 2 disappeared, this one is going to disappear too', he said.
"We will be better off without central banks," Rogers claimed, admitting that “we have problems when we don't have central banks" but stressing that the Fed made it worse over the last 20 years with a "staggering amount of debt".
"They created bubble after bubble after bubble," he added.
Rogers has been stressing during his many appearances on business networks that trying to push the problem out to the future by printing more money isn't going to work.
In a lecture at Oxford University’s Balliol College last week, he said of the Fed Chairman, “all he understands is printing money."
“Dr. Bernanke unfortunately does not understand economics, he does not understand currencies, he does not understand finance,” Rogers told his audience.
He finds the idea that you can solve a period of excessive borrowing and consumption with more borrowing and more consumption and destroying more balance sheets, "ludicrous on its face".
Underscoring his convictions that future prosperity will come from China, Rogers' two young children speak Mandarin.
He said his elder daughter, who is six years old, is in school in Asia and speaks fluent mandarin thanks to a governess who can speak fluent Chinese.
The other younger daughter was also learning mandarin.
"The single most important advice I can give you is teaching your child mandarin," he recently said, urging investors to sell US dollars when it peaks in the near term.