Thursday, March 06, 2008

Singapore invest in citigroup?

By The Edge

Investment guru Jim Rogers believes US bank stocks could fall further and predicts Singapore’s state investors will lose money on their multi-billion dollar investments in Citigroup and Merrill Lynch.

“I’m shorting investment banks on Wall Street,” Reuters reported the long-time commodities bull as saying yesterday at a launch event for ABN AMRO certificates linked to commodities.

“It grieves me to see what Singapore is doing. They are going to lose money,” he added, referring to investments by Government of Singapore Investment Corp and Temasek in Citigroup, Switzerland’s UBS and Merrill Lynch.

Rogers, an American who co-founded the Quantum Fund with billionaire George Soros in the 1970s, now lives in Singapore as he wants his four-year-old daughter to learn Mandarin.

Rogers, who also writes investment books, said Wall Street had to work off 10 years of excesses and predicted that losses linked to risky mortgages will eventually spread to credit card bills, student loans and other debt.

Meanwhile, Bloomberg quoted Rogers as saying that crude oil prices would go up much higher, but “how high I don’t know”.

“Commodities are going to go higher because there’s just not enough. The dollar’s weakness is the icing on the cake for commodities.”

On stocks he was buying, Rogers said: “I have been buying Chinese shares, water treatment, power generation and tourism. I plan to buy more shares in China. I bought more Taiwan this week. I’m buying the renminbi, Swiss Francs and the yen.”

“Inflation is going to get worse and you have to be prepared for higher prices of everything. Higher prices always eat into demand patterns but that’s part of the cycle,” he said.