Jim Rogers spoke to Bloomberg Television today on the situation in the Middle East. While his bullishness on oil is well known, his comments on the Saudi Arabians’ ability to compensate for the loss in Libyan production are of interest.
0:15 Saudi Arabia can’t make the short fall from Libyan supplies; They’ve said in the past that they can increase production, but they can’t. They told George W. Bush they couldn’t. The reason oil is going up is that the world is running out of known reserves of oil.
0:45 Oil could go back down for a while, if things come down in the Middle East. But the reality is the underlying oil supply story means oil is going higher in the long-term.
1:40 In bull markets, prices go to points that not even the bulls will believe. The bull market in commodities still has several years to go.
3:50 I know that either way commodities will go up. If the economy gets better, demand will rise, and if it gets worse, central banks will print more money.
4:00 In the seventies, most stocks did bad, but commodities stocks did well.
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