Rogers: Invest in water and farms

American investor Jim Rogers, who has been based in Singapore since 2007, wastes no time.

The well-known investment guru was cycling on his stationary bike at a vigorous pace and initiating his new personal assistant, while answering interview questions, when My Paper visited him at his home last week.

In his journey from Alabama to Singapore, which he wrote about in his latest book, Street Smarts, he found time to co-run a hedge fund with renowned investor George Soros, make two round-the-world trips by bike and car, and have two daughters.

Mr Rogers, 70, spoke to My Paper in a wide-ranging interview about investing in water, why he wants to invest in North Korea and his advice to young people starting out.

Why and how would one invest in water?

The world - from China and India to the west of the Red Sea - faces some serious water problems. There will be wars over water soon. If you can figure out a way to solve those problems - clean it, transport it, filter it - you'll be very rich.

Singapore is a centre for dealing with water, mainly because it has its own gigantic water problems. I have looked for water companies in Singapore and I own a few shares in Hyflux.

What other Singapore companies have you invested in?

If I tell you the companies I own, people will go out and buy it because they read it in the newspaper and I try to discourage that. It's a terrible way to invest, that's why I try not to give specific names.

Which commodities are you optimistic about?

At the moment, I am more optimistic about the ones that are depressed. Agriculture has been a terrible business for 30 years, and my view is that it is in the process of changing.

Natural gas is depressed, and that is a good place to start doing research. You don't buy something just because it is down, but it is a place to start looking.

You have said that the current currency debasement is a race to insanity. How do you see it ending?

This is the first time in recorded history when all major central banks are debasing their currency. You have all this money flooding into the world, causing a lot of turmoil. The people who are getting the money are having a good time, but it's artificial and not sound.

Either they will run out of trees because they are printing all that money, or the world will say, "I would rather have a piece of silver or a bag of rice than this paper money" and then it stops. It will end badly, it always has.

Can an investor in Singapore benefit from this currency war?

Only if that investor knows what he is doing.

Singapore is one of the few countries in the world that still insists on a sound currency, which is good. The problem is that if everybody else is debasing their currency, it puts Singapore in a less-competitive position. If you can figure out ways to exploit the coming problems, you can make a lot of money.

I've mentioned inflation, shorting bonds, real assets and owning the right currencies. But if you cannot spell currencies, don't start investing in them.

There are gloomy predictions about China's collapse. What's your take?

China will certainly have setbacks along the way, just as the United States did in the 19th century while on its way to becoming the most successful nation in the 20th century.

China has some problems, like a persistent property bubble and exchange controls which are not helping but, the next time I see problems in China in the newspaper, I'm going to pick up the phone and buy more China.

What other countries would you invest in at the moment?

I'm very interested in Myanmar.

In 1962, it was the richest country in Asia, then it closed off and, 50 years later, it is the poorest country in Asia. But it has opened up, like China in the late 1970s, so it's an extraordinary opportunity for most people.

North Korea is in the process of changing and there will be many opportunities there in the next 10 to 20 years.

I'm trying to find investments in Russia, which has been a disaster in many ways from an investor's point of view. I've been bearish on Russia for 46 years, but I take the view now that there are opportunities there.

North Korea, really?

I love it when everybody's sceptical about something; it makes me so excited.

The North has a new kid (Mr Kim Jong Un) running the place, who was educated in Switzerland and knows the difference between Europe and North Korea.

His generals, more importantly, used to go to Moscow and Beijing, now they know the opportunities, as they know what happened in China and Russia.

Would you invest in the bond market now?

I'm not invested in the bond market right now but, if I were - in the Western bond market - I would sell it short. Invest if you can find special-situation bonds or short-term bonds, but I'm waiting to short long-term US bonds.

Is there a property bubble?

Singapore, Hong Kong, China are all trying to cool the property market, as they should. And I expect they will, as these are reasonably competent governments.

I am looking for a house to buy in Singapore, and I hope I don't find anything proper too soon, because I expect prices to come down in much of Asia.

If you can buy a place in Myanmar or North Korea, do so, but, in the red-hot areas, I would suggest to be careful.

What was your worst investment and your best?

My worst was my first wife, a total waste of my time.

My best investment are my two girls (Hilton Augusta and Beeland Anderson). I am spending a huge amount of time and money and energy on them, they are my very best investments. I hope they are going to take care of me some day.

You've said finance is dead. What advice would you give a young person who's just starting out?

Don't go into finance unless you're passionate about it, like I was. Agriculture is where the money will be, because there is no competition.

I don't see Singapore becoming the next big cotton exporter, but you could be a fish farmer, or buy a farm in Myanmar or China.

Sell seeds, sell fertiliser, or get a Lambhorghini dealership in a rural area, because the farmers will be the ones who will be rich.

Stockbrokers will be driving taxis. But, most importantly, pursue your passions.

chuimin@sph.com.sg

Jim Roger's book, Street Smarts, is available at all major bookstores at S$29.95 (inclusive of GST).

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