Just today I read a recent interview with Jim Rogers conducted by Hera Research, LLC. I still hear comments, from time to time, about there being no inflation and therefore no reason to buy gold, just yet. Yes, it is agreed that inflation and gold have a very intimate relationship, but if there is no inflation . . . what is a gold coin going to protect you from?Jim Rogers is a well known investor and founder of the Quantum Fund. He has long been recognized as a commodities guru. While he will not go as far as to say gold should be the world's reserve currency, he has acknowledged that inflation is coming and it will drive gold prices higher. He was asked some pointed questions during a recent interview about inflation. I thought you have heard enough from me so perhaps this time you don't have to take my word for it - take it from Jim. Here's an excerpt from that interview.HRN: You mentioned that the US is the largest debtor nation in the history of the world. Do you think that will lead to high inflation or hyperinflation in the US?
Jim Rogers: Well, there will be inflation. First, you have to have inflation before you can have hyperinflation. I mean, we have inflation now. If you go to the shop, whether it's groceries, or education or insurance or health care, prices are going up for everything. The government lies about it in the US. Some countries lie, many countries don't: Australia, China, India and Norway. Many countries don't lie about it and acknowledge that we have inflation. Others lie about it, the UK and the US, but if you go shopping you know prices are up.
Jim Rogers: In my opinion, yes, of course it is. Have you looked at it? They've changed their accounting several times in the past few decades. When housing was 20% to 25% of the CPI and housing was going up, they didn't count it, saying rents weren't going up, and then when home prices started going down, they counted it. It's the same with many things. It's staggering some of the tortuous reasoning that the BLS has used over the past 25 or 30 years. When the price of gasoline goes up, they say it's not really going up because it's better gasoline, better quality, therefore you're getting more for your money. I mean, it's endless, the stuff that they say and for some reason people sit there, although more and more people are catching on, and accept what the government says. As I said, in other countries, they acknowledge that there's inflation. I don't know how there could be inflation in Australia and not in the US; how you can have inflation in Norway or India and not in the US, but the US says there's no inflation.I think this sentiment is gradually being shared by more and more people. Make no mistake, it's not just your friendly coins dealer that talks about inflation.