Jim Rogers, a well-known US commodities expert, believes that the panic around the coronavirus is a bit overblown. According to him, any correction in the precious metals market gives investors a good buying opportunity.
Speaking to Kitco News, Jim Rogers analyzed the situation in the financial and gold markets. Rogers lives in Singapore and considers that the panic surrounding the virus is exaggerated. Supermarkets, restaurants, and planes are empty; people try to avoid personal contact. The travel industry has taken a particularly strong hit.
Both in Asia and in the West, a lot of people are giving in to the panic, though the number of sick people is relatively small. According to Chinese authorities, the epidemic has passed its peak, but the negative pressure on the economy continues. For this reason, many countries might face a recession this year. There hasn’t been a recession in the US for 10 years, which is the longest recession-free run on record. However, the epidemic spurred a long-awaited consolidation in the financial markets, which, according to Rogers, were oversold by 20%.
The commodities expert considers that financial authorities in some countries are making rash decisions, due to the virus outbreak. Thus, certain institutions started cutting interest rates, while printing even more money, and selling part of their gold reserves. This can lead to the formation of a new large financial bubble.
As for last week’s rapid decline in the precious metals market, Jim Rogers views it as a great opportunity to buy gold. He believes that panic will drive some investors to sell their gold and silver to take profits. A similar event occurred in 2008 when the news of Lehman Brothers’ bankruptcy broke. The market correction lasted for several months until the prices started growing again. For this reason, this is a great moment to make long-term investments in precious metals.
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