How I See the World Today

0:00I did go to my 50th high school reunion over in Demopolis, Alabama, this week, and one of the first people I saw was a former classmate, and he said, gosh Jim, it's good to see you, what have you been doing the last 50 years? I said, well I've been here and there, you know, I've been here and there doing a few things. You know, it is good to come to Alabama. A few years ago I was invited to speak at a university here, and a woman came over to to me and said, who are you and why are you here? Why are you speaking to us? I said, well, my name is Jim Rogers and I grew up in Demopolis and I've been in New York for a while and she said, no, no, but who are you? Why are you here? And I said, well, you know, I'm working on Wall Street and in a way and she said, no, no, listen, tell me

0:46who you are and a guy came over, happened to be my second cousin, he said, look, this is Jim Rogers, he's related to the Randalls and the Nugents and the Spencers and the Johnsons Now I know who you are. Now I know why you're here. So, Alabama's a wonderful place, Lew, and thank you for inviting me back. I could spend the whole night talking about Alabama, but I think we'll move on to other things. Paige and I, as Gary mentioned, Paige and I recently went around the world. We spent three years. We drove 245,000 kilometers. We went through 116 countries and as you can see we got into the Guinness Book of World Records because I'm the first person from Demopolis, Alabama to drive around the world. In my case it was pretty easy to get into the Guinness Book of Records.

1:37Paige and I started in Iceland, we drove through Europe, Turkey, China, Korea, Japan, back across Siberia and Mongolia, across Russia, all around Europe, 32 countries in Africa, Southeast Asia, Australia, New Zealand, down to the bottom of South America, up through Central America to Alaska, back down through the southern part of the U.S., including Alabama, and then back to New York. As you can see, it was a long way. It was three years on the road, 245,000 kilometers, 116 countries. So when we got home, we thought we ought to stop and rest for a while, get a little tired. And one result of resting for a while is we now have a baby girl.

2:25I needed an excuse to show you my children. You know, I never wanted to have a child in my whole life. I thought children were a terrible waste of time, money, energy, effort. I used to feel sorry for my friends who had children. I was never going to do something so foolish as that. Well, I want you to know I was totally, 100% unadulteratedly wrong about that. I cannot get enough of this little girl. She is so much fun for me that I, you know, 24 hours a day, 7 days a week. In fact, you know, if there's anybody in the room who hasn't done it, I urge you to get home and get on with it. Take the day off if you have, well, no, no, no, don't take the day off these days. Go home for lunch. Go home on your lunch hour. But I'm telling you it's a lot of fun.

3:20Now lest you think I'm just standing up here muttering and telling you these things, anything I tell you tonight I'm doing myself, I wouldn't be telling you about. But lest you think I'm just giving you advice and not acting on it, Paige and I did it again. We have two little girls now, and I will tell you, it is so much fun, these little girls. I cannot get enough of them. What I'm going to do next is I'm going to show you a short video. Lou showed you a video. I'm going to show you two minutes. I'm going to show you what it's like to go around the world. I cannot show you three years of driving around the world in two minutes, but a survey was done recently that the number one dream which people have in the world, Not everybody's number one dream, obviously, but the dream which comes out on top in surveys all around the world is to chuck it all, get in the car and drive around the world.

4:13So I hope that all of you are going to learn so much from Lew and the von Mises Institute that you too are going to get a new spouse or take the old spouse, take a spouse, take a spouse and head off around the world. We'll give you an idea of what it's like. It starts with us in Iceland, toasting each other, wondering if you'll make it alive. Off to the Great Wall. We did get married on the trip. Here we are cutting our cake. And this is our honeymoon. One of many, many camels we ran into. We went through 15 war zones. These guys were not very friendly at first.

4:59But if you look in the upper right-hand corner, you will see a familiar face. One of many markets we visited. This is one of many bad roads. A sadder time, we went to an AIDS orphanage down in South Africa. We went to see King Tut. Whatever we could, we stopped in schools, because I'm very keen on education. This was in India, everybody always wanted to have their pictures made. Myanmar, which used to be called Burma, one of many roadside stands where we ate and drank.

5:48Iguazu Falls, down in South America. This is a bane of my existence, this is bureaucracy, red tape, regulations. On the other hand, this is the black market, this is a much higher class of people. And when we got back to the US, we kept going, we headed up to Alaska in the dead of winter. And when we got back to New York, our first stop was World Trade Center, that had blown What I'm going to do tonight is I'm going to give you all some of my views about what are happening in the world, what is going on in the world.

6:36And then I thought it would be nice if Lou came up and we had a conversation and Lou asked me questions and then you all can ask questions so that we could have an engaging evening where we can all talk about what's going on in the world and our views of the world. The first thing, well I will just get it out of the way, one of the most important things happening in the world today is the rise of China. We all have to understand it, whether we like it or not, whatever our views of China, it doesn't matter because in my view the 19th century was the century of the UK, the 20th century was the century of the US and the 21st century is going to be the century of China. Whatever your views in the world are, you need to understand what's happening. Paige and I sold our house in New York. We have moved to Singapore because our children speak perfect Mandarin.

7:28And I will tell you that the best advice I can give you of any kind is to make sure your children and grandchildren speak Mandarin, because it is going to be the most important language in their lifetime, whether we like it or not. So we have moved to Asia. Our two little girls, I showed you pictures of them. Both are fluent in Mandarin. They go to a local Chinese school. They are the only blue-eyed blonde girls in the whole school. In fact, there are only blue-eyed people in the whole school with 2,700 kids. But with that adamant, the best skill which we can give them is to understand Asia and to be fluent in the Chinese language. Anything we talk about, anything you do, you need to understand that.

8:14It's changing the world. The Chinese call themselves communists, but let me tell you, they're among the best capitalists in the world. There are people who will tell you that they are the best capitalists in the world here in 2010. I mean, listen, guys, California is more communist than China, I assure you. Massachusetts is much more communist than China in 2010. In China, they save and invest 35% of their income. In the United States, we save and invest 2% of our income. In China, when they come to work, they don't say, how many holidays do I get? They say, how many days can I come to work? They know how we live here. They know how the developed world lives. They want to live that way, and they're doing it.

9:01to move on to other things but that anything you do you need to understand that another thing that we need to understand in my view another great change that is taking place when a period of unbelievable change in fact who would have said 30 years ago that China is going to be the most important country in the world it's just it's staggering but other things that are happening as you all know in the United States We were, and many people still think we are the most important country in the world, but we have to temper that by the realization that the world is always changing. Remember in the 1920s and 1930s, there was a major shift from the UK to the US, exacerbated by a financial crisis.

9:51I would submit to you that the world is in that kind of change now. The Center of Power is moving from the U.S. to Asia, again exacerbated by a financial crisis. The 20s and 30s were also exacerbated by mistakes by U.K. politicians. Well, I don't have to tell you that U.S. politicians are making many mistakes here as we speak in the early part of the 21st century. If you look at the world, look at this map. The largest creditor nations in the world now are China, Korea, Japan, Taiwan, Hong Kong, Singapore. You can look at the map, you can see where they are. That's three billion people and they have most of the world's assets as we speak.

10:39You know who the largest debtor nations in the world are and you know where they are. Unfortunately, in Washington, they're driving our debts higher and higher and higher, and they're continuing to make the situation worse rather than better. Part of the things we've been discussing the last couple of days are the fact that Washington says the economic recovery is here, and Lew and all of you have been pointing out, it is a lie, it is not happening, as most of you know. And even if it is happening, you know as well as I do that what's happening is they're You're taking the money and giving it to some people. Well, the people who get that money think things are better, and they are. You would be, too, if I came along and gave you a couple million dollars. Everybody who's getting this money thinks things are better.

11:27But the money has to be either be printed or borrowed or taxed. So the country as a whole, the world as a whole, is actually much worse off than it was before. As you know, it is the official policy of the Central Bank of the United States to debase the currency. The head of the Central Bank in America, his own record, is saying if he has to get in a helicopter and fly around the world and drop out dollar bills, he will do so. And this is a man who does not understand economics. This is a man who does not understand finance. He does not understand currencies. All he understands is printing money. His whole intellectual career has been devoted to the study of printing money. America has given him the printing presses and he's running them as fast as he can.

12:14But you just wait till we have serious problems. Then he's really going to run those printing presses. The world's going to run out of trees before Mr. Bernanke finishes with his approach to the world. So the world as a whole, and especially the United States, is getting worse. We are in a historic period when things are shifting, unfortunately, and I don't like saying it, unfortunately shifting from the U.S. towards Asia, partly because of the foolishness that's been going on in Washington in the last 30, 40, 50 years, actually longer. Dr. Lew today at lunch talked about there's going to be an election in November and the Tea Party may win or new people may win. He's not very optimistic about the changes that they may bring and he's right because for whatever reasons, let's say they all win, well they're a very disorganized and incoherent group for the most part and many of them have conflicting views of what from many of the others that may win.

13:17By the way, I would also point out to you that Mr. Obama won an election based on change, and all he did was come in with the same people, doing the same foolish policies, and getting us deeper and deeper into trouble. These guys, if they win, will also make a mess of it, and things will not be great. I unfortunately think that America is going to continue doing foolish things, and we will all be getting worse and worse off. As I said to you before, The Center of Power is leaving the United States and is going to Asia, as happened 70 or 80 years ago. We now have a group of people in Washington who say, the problems we've had in America are caused by too much consumption and too much spending.

14:04Uh-oh, what did I say wrong? I said something about Washington, see, that was the problem. People in Washington say the problem is too much spending and too much consumption, and you know what we're going to do to solve that problem? We're going to spend more and go deeper into debt. And this is staggering to me that grown-ups can say something like that out loud and mean it. It is more staggering to me that people listen to it and get away with it. There's a man named Krugman who won the Nobel Prize. I will tell you, it's too bad we don't have time. In fact, I would like to write an article about what a sham the Nobel Prize for Economics is, because it's really just unbelievably...

14:51Well, I'll develop that for one minute. The Nobel Prize for Economics was started in 1969, so in the past 41 years, the only people who have ever won that have been either American or European academics. And in that 41 years, America and the UK and Europe have gone down the tubes. Nobody from Asia has ever won the Nobel Prize for Economics. And that's despite the fact that Asia has been on the skyrocket for 41 years. Some of you have probably heard of Lee Kuan Yew, a guy who took Singapore from a swamp to perhaps the richest country in the world. Never mentioned for the Nobel Prize. Nobel Prize. Deng Xiaoping, great communist leader of China, totally changed China, threw out communism, brought in capitalism and entrepreneurship, and made China the most successful country in the past 30 years.

15:46Never mentioned for the Nobel Prize. There have certainly been a couple of Nobel Prize winners, as you all know, that we all know and admire, but nobody from Asia has ever won the Nobel Prize for economics. I could go on and on about the other Nobel Peace Prize too, but I won't. Let's go on with what's happening in Washington. As I was saying, Lew thinks that there will not be much change. I happen to agree with him that I'm afraid the situation is going to get worse. He says that then everything will be great because people like us may come to the forefront. Well, I hope he's right. My only worry is that throughout history, when countries have gotten themselves in the bond that America's in, they've never solved their problems without a crisis or a semi-crisis.

16:38I don't know of any country that has said, okay, we've got a terrible problem, we're going to bite the bullet and shape up. It's never worked, never happened, and I'm afraid we're getting so deep in trouble it's going to take much more than that. The good news, of course, from our point of view is, that it's been people like Keynes and Krugman and some of the other lot that have been running things for the past 40 or 50 years. And so they're becoming more and more and more discredited. So when the crisis or the semi-crisis comes, perhaps Lew and some of you will be the ones who will save us from what will happen coming down the road. I have a lot of other things to say, but I think what I'll do on that happy note, I'll stop and invite Lew up, because he's got questions for me, but I do want to say to you, as far as I'm concerned, while we're having our discussion, you can ask any question you want of me, you can ask about great honeymoon spots, or the best beer in the world, or the worst beer in the world, or how to make money, anything you want.

17:46Thank you very much.