Video transcript
Answer 1:
No absolutely not. Nobody has planted any more wheat; nobody has discovered any oil. There’s no new supply coming. If anything, the very fact that we have all this financial problems means there’s less financial support to open new mines or discover new oil, or to expand new farms. If anything it makes it worse remember it’s a problem of supply and demand.
Supply is declining dramatically in many areas of commodities so even if demand goes down, supply will go down more. And that’s still a bull market.
Answer 2:
No, the 21st century is the century of China. There's no question about that. There will be setbacks along the way as China rises to power and glory as Asia rise to power and glory.
In America, we have had some horrible setbacks along the way.
The UK had horrible setbacks along the way but they have both rose to power and glory, they both did a pretty good job.
China will too, I don't see anything that will change that. Nothing that I have seen happening in the US will change that.
Answer 3:
Well Macquarie has a long, long tradition of raw materials, natural resources commodities. I mean the whole Australian economy is based on natural resources. Macquarie has a lot of smart people; they are very big in Asia. They know raw materials.
My question to you would be why not Macquarie.
Answer 4:
Well, who knows if this is the start of anything, in the future? If it works, of course we might do a lot of other things. But China is the largest country in the world population wise, there's no question about that.
And it is the most rapidly growing country in the world, there will be setbacks along the way but China is the best place.
If you want to have a rapidly growing economy and you want to participate in it, China is the one to select. And one of the best ways to invest in China is to invest in commodities. They have to buy commodities.
You could buy Chinese stocks but you have to worry about corporate governance, central banks, you have to worry about a million things if you start buying stocks. But if you buy commodities the Chinese have to buy commodities. They have to be nice to you. They will take you to dinner, they will pay for dinner, and they will pay their bills on time.
One of the very best ways to invest in China is to invest in commodities.
Answer 5:
When I first went to China 25 years ago a common expression when you greeted someone on the street was "Have you eaten today?"
Just as we would say, "Hello, how are you?" Remember, the Chinese have not been very prosperous or been eating a lot for the past 100 years. They have had many, many problems. That's changing now.
Many Chinese when I first went there had never had chicken, had pork once a year or on special occasions, in a lifetime perhaps. That's all changing and changing dramatically. Their per capita income is a mere fraction of what it is in Australia or in the US. That's changing, that's rising.
They are going to have a lot of different clothes - cotton, silk, wool, whatever it happens to be. They are eating more. Rubber - they are going to have more running shoes. They are going to have more everything. So as China develops, one of the best ways to play the development of China, to invest in China is agriculture commodities.
You pick the one you want. 10 years ago, China exported cotton. Now they are one of the largest importers of cotton in the world. 10 years ago, China exported sugar, now they are a huge importer of sugar. As people get more prosperous they like sweets, believe it or not, they use more sugar. Plus now many people are starting to consume sugar in their fuel tanks.
Turning sugar into Ethanol to power their vehicles.
So I can give you any example -whether you want to use sugar or cotton.
Answer 6:
The Chinese are theoretically are lactose-intolerant. If you go to China now, you'd find Pizza Hut is booming, all over the place. The Chinese may be lactose-intolerant or at least they were told they are but they are consuming a lot of milk products. And since they haven't had much milk for centuries, now they are suddenly discovering it and now they are suddenly using it.
Cocoa. You know the Chinese have not had candy or sweets very much in a hundred years because of the economy of China but that's changing.
Everybody in the world seems to have a sweet tooth, everybody in the world seems to love chocolate, and so chocolate has a big boom ahead of it.
Orange juice, same thing. Many people love orange juice. When many people are exposed to orange juice they somehow seem to drink lots of it.
The Chinese haven't, haven't had it for centuries. Now they are discovering orange juice, we presume they will continue to drink more of it just as other people do.
Answer 7:
I am sure there will be a repeat of this. We have already started having some repeats of this. What happened in the 70s was while the supply and demand got terribly out of balance, people were consuming more of the world's supplies in many things. In some cases the situation was compounded by weather problems. So we had a huge boom. Sugar went up 47 times in 8 years in the 1970s.
That sort of thing is going to happen again. Only this time it may be worse. We have the lowest inventories of food in 50 or 60 years, the number of hectares devoted to wheat farming has been in decline for 30 years. You know we are starting to use a lot of agricultural products in our fuel tanks to power our cars instead of eating them. We have lots of different things that are different now. So I can see a huge bull market in commodities going down the road because the world is not producing anymore. We have shortages of seeds, fertilizers, tractors, tractors tyres.
We have a shortage of farmers now. You know in the last 30 years farming has been a terrible business so very few people became farmers. You know a lot of people who became financial types, or journalists or lawyers. Nobody who went to school with you became farmers. All farmers are old men now. We even have a shortage of farmers.
Answer 8:
Well, I am the world's worst market timer. I am the single worst short-term trader you will ever meet, I promise you that. So I have no idea whether this is the time or not. But I know everybody should own agricultural commodities. I know that I bought more recently. I know that one of the few bull markets that I can see going up in the next 5 to 10 years is in agriculture.
You may not have bull markets in cars or financial institutions or lots of other things but I know the world is not going to stop eating. We may stop driving to work, you may walk to work but we are still going to eat, we are still going to wear clothes and I know the supply of all agricultural commodities is under pressure.
It's one of the few places I know where you should have money, even if the world comes to an end. I'd rather own agriculture than just about anything.
General
The information shown in this website is neither a recommendation, an offer, nor a solicitation for any investment product or service. It provides general information only about the Macquarie Funds Group. Investment involves risk. You should carefully consider whether any investment product or service mentioned on this website is appropriate for you in view of your personal circumstances. Past performance is no guide to future performance. Investors should refer to the individual product explanatory memorandum or offering document for further details and risks involved. The price of investment products may move up or down. Losses may be incurred as well as profits made as a result of buying and selling investment products. This website has not been reviewed by the Securities and Futures Commission.
Macquarie
Other than Macquarie Bank Limited ABN 46 008 583 542 (MBL), any Macquarie Group entity noted on this page is not an authorised deposit-taking institution for the purposes of the Banking Act 1959 (Commonwealth of Australia). That entity's obligations do not represent deposits or other liabilities of MBL. MBL does not guarantee or otherwise provide assurance in respect of the obligations of that entity, unless noted otherwise.
""Jim Rogers", "James Beeland Rogers, Jr.", "Rogers" , "Rogers International Commodity Index" and "RICI" are trademarks, service marks and/or registered trademarks of Beeland Interests, Inc., which is owned and controlled by James Beeland Rogers, Jr., and are used subject to license. The personal names and likeness of Jim Rogers/James Beeland Rogers, Jr. are owned and licensed by James Beeland Rogers, Jr."
Products issued by or on behalf of Macquarie Bank Limited or its affiliates ("Macquarie") are not sponsored, endorsed, sold or promoted by Beeland Interests, Inc. ("Beeland Interests") or James Beeland Rogers, Jr. Neither Beeland Interests nor James Beeland Rogers, Jr. makes any representation or warranty, express or implied, nor accepts any responsibility, regarding the accuracy or completeness of this website, or the advisability of investing in securities or commodities generally, or in Macquarie products or in futures particularly.
NEITHER BEELAND INTERESTS NOR ANY OF ITS AFFILIATES OR AGENTS GUARANTEES THE ACCURACY AND/OR THE COMPLETENESS OF THE MACQUARIE AND ROGERS™ CHINA AGRICULTURE INDEX ("INDEX"), ANY SUB-INDEX THEREOF OR ANY DATA INCLUDED THEREIN. SUCH PERSON SHALL NOT HAVE ANY LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN AND MAKES NO WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY OWNERS OF MACQUARIE AND ROGERS™ CHINA AGRICULTURE INDEX PRODUCTS, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE INDEX, ANY SUB-INDEX THEREOF, ANY DATA INCLUDED THEREIN OR MACQUARIE AND ROGERS™ CHINA AGRICULTURE INDEX PRODUCTS. NEITHER BEELAND INTERESTS NOR ANY OF ITS AFFILIATES MAKES ANY EXPRESS OR IMPLIED WARRANTIES, AND EACH EXPRESSLY DISCLAIMS ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE INDEX, ANY SUB-INDEX THEREOF, AND ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL BEELAND INTERESTS OR ANY OF ITS AFFILIATES OR AGENTS HAVE ANY LIABILITY FOR ANY LOST PROFITS OR INDIRECT, PUNITIVE, SPECIAL OR CONSEQUENTIAL DAMAGES OR LOSSES, EVEN IF NOTIFIED OF THE POSSIBILITY THEREOF.
The "MACQUARIE" word and "HOLEY DOLLAR" device, are names, trademarks, service marks, logos and icons of Macquarie Group Limited ("Macquarie"), and are used subject to license. The names, trademarks, service marks, logos and icons of Macquarie may not be used in any manner without the express prior written permission of Macquarie.
NEITHER MACQUARIE NOR ANY OF ITS AFFILIATES GUARANTEES THE ACCURACY AND/OR THE COMPLETENESS OF THE MACQUARIE AND ROGERS™ CHINA AGRICULTURE INDEX ("INDEX"), ANY SUB-INDEX THEREOF OR ANY DATA INCLUDED THEREIN. SUCH PERSON SHALL NOT HAVE ANY LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN AND MAKES NO WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY USERS OF MACQUARIE AND ROGERS™ CHINA AGRICULTURE INDEX PRODUCTS, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE INDEX, ANY SUB-INDEX THEREOF, ANY DATA INCLUDED THEREIN OR MACQUARIE AND ROGERS™ CHINA AGRICULTURE INDEX PRODUCTS. NEITHER MACQUARIE NOR ANY OF ITS AFFILIATES MAKES ANY EXPRESS OR IMPLIED WARRANTIES, AND EACH EXPRESSLY DISCLAIMS ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE INDEX, ANY SUB-INDEX THEREOF, AND ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL MACQUARIE OR ANY OF ITS AFFILIATES HAVE ANY LIABILITY FOR ANY LOST PROFITS OR INDIRECT, PUNITIVE, SPECIAL OR CONSEQUENTIAL DAMAGES OR LOSSES, EVEN IF NOTIFIED OF THE POSSIBILITY THEREOF.
Bloomberg Finance L.P. and its affiliates are not affiliated with Macquarie Bank Limited and do not approve, endorse, review or recommend Macquarie Bank Limited or Macquarie and Rogers™ China Agriculture Index.
The values of the Macquarie and Rogers™ China Agriculture Index are derived from sources deemed reliable, but Bloomberg Finance L.P., its affiliates and its and their respective suppliers do not guarantee the correctness or completeness of the Macquarie and Rogers™ China Agriculture Index, its values or other information furnished in connection with the Macquarie and Rogers™ China Agriculture Index. Bloomberg Finance L.P. and its affiliates make no warranty, express or implied, as to results to be obtained by Macquarie Bank Limited’s customers, or any other person or entity from the use of the Macquarie and Rogers™ China Agriculture Index or any data or values included therein or in connection therewith. Bloomberg Finance L.P. and its affiliates make no express or implied warranties, and expressly disclaim all warranties of merchantability or fitness for a particular purpose with respect to the Macquarie and Rogers™ China Agriculture Index or any data or values included therein or in connection therewith.
Bloomberg Finance L.P., its affiliates and its and their respective partners, employees, subcontractors, agents, suppliers and vendors shall have no liability or responsibility, contingent or otherwise, for any injury or damages, whether caused by the negligence of Bloomberg Finance L.P., its affiliates or its or their respective partners, employees, subcontractors, agents, suppliers or vendors or otherwise, arising in connection with the Macquarie and Rogers™ China Agriculture Index or any data or values included therein or in connection therewith and shall not be liable for any lost profits, losses, punitive, incidental or consequential damages. Bloomberg Finance L.P., its affiliates and its and their respective partners, employees, subcontractors, agents, suppliers and vendors shall not be responsible for or have any liability for any injuries or damages caused by errors, inaccuracies, omissions or any other failure in, or delays or interruptions of, the Macquarie and Rogers™ China Agriculture Index or any data or values included therein or in connection therewith, from whatever cause. Bloomberg Finance L.P., its affiliates and its and their respective partners, employees, subcontractors, agents, suppliers and vendors are not responsible for the selection of or use of the Macquarie and Rogers™ China Agriculture Index or any data or values included therein or in connection therewith, the accuracy and adequacy of the Macquarie and Rogers™ China Agriculture Index or any data or values included therein or in connection therewith or information used by Macquarie Bank Limited and the resultant output thereof.