Thursday, September 19, 2013

India scapegoates gold


In my view, the main reason for the correction, other than the fact that it needed it, was on account of Indian politicians who suddenly blamed their problems on gold. The three largest imports to India are crude oil, gold and cooking oil. Since they can’t do anything about crude and vegetable oil, the politicians said India’s problems were because of gold, which, in my view, is totally outrageous.

But like all politicians across the world, the Indians too needed a scapegoat. Is this the reason why gold started correcting? I don’t know. But, India is the largest importer of gold, and whenever the largest buyer cuts back, there will be a correction, whatever is the commodity. The correction may continue for several more weeks, months or even a year or two. A 50% correction is common for commodities, but if gold were to correct 50% before it made its final bottom, that would be between $900-1,000.


Jim Rogers is a bestselling author, financial commentator and successful international investor. Rogers was a co-founder of the Quantum Fund (considered to be the first truly international fund of its kind) and is the creator of the Rogers International Commodities Index (RICI).
JIM ROGERS BLOG