Jim Rogers is an investing legend.
He and George Soros co-founded the Quantum Fund, one of the world's most successful hedge funds. After generating returns of 4,200% over 10 years, Jim quit full-time investing in 1980 to do whatever he wanted.
Since then, he has become a bestselling author and holds several Guinness World Records – including "Most countries visited in a continuous journey by car." He's traveled around the world by car and motorcycle – trips that were the basis for two of his books, Investment Biker and Adventure Capitalist.
Jim has fantastic insight on investing – and, in the bigger picture, on how to find and follow your passion and live an exciting life.
Jim lives in Singapore, and when I (Kim Iskyan) lived there too, I met with him several times. I recently spoke with him on a video call to catch up, and we talked about what Jim has learned from his mistakes... what he thinks of cryptos... debt, and why it's a good time to be old... the most exciting countries to visit... and how to stay young.
What follows is an edited transcript of some of our conversation...
On Learning From Mistakes
Kim Iskyan: You're a very successful investor. But what have you learned from your mistakes?
Jim Rogers: Oh, Kim, I've made many mistakes. We can talk about mistakes all day if you want to... You want to hear about my first wife, what a disaster that was? I've made plenty of mistakes.
I've learned more from my mistakes than I have from my successes. You know, the problem is that when people have success, they always think, "My God, this is easy. I'm so smart."
No, what you should do then is close the door, close the window, and hide for a while. Go to the beach or something. When you start thinking about how smart you are, that usually leads to problems down the road. So, beware of success.
Kim: Be humble, I guess, is what you're suggesting.
Jim: If you're not humble, the market will make you humble. At least it has made me humble.
I can remember one of my first mistakes in the market, and I often talk about it at universities. It was around 1970 or so. I was brand new to the [investment] business. I mean, I was a kid, I didn't know anything. But I suddenly tripled my money after I bought puts on the market [puts rise in value if the market declines], and tripled my money in five or six months. And everybody was going broke around me... It was a horrible bear market. I sold my puts the day the market hit bottom, and I said, "This is so easy, I'm going to be so rich."
And then three months later, I waited for the market to rally, which I knew it would. I thought I was a smart kid. And then I sold short... I took everything I had and sold short. I was wiped out, lost everything.
By the way, Kim, every company I shorted [that is, bet that they were going to go down in value], six companies, went bankrupt eventually. But I lost everything first.
I learned quickly that even if you're right, you can get wiped out... because there are many other players in the market and you have to be aware of all the other players, what they're doing, and what they're thinking. That's part of the problem with the markets – and part of the joy, and ecstasy, and excitement – but that doesn't make it easy.
Kim: What are your thoughts about cryptocurrencies?
Jim: Well, a lot of people I know have made a lot of money trading this stuff and I read about them. I have never bought nor sold any cryptocurrency. And the reason being, I'm not a trader. I'm a hopeless trader, so there's no attraction for me.
And as you know, many cryptocurrencies have disappeared and gone to zero. There have been hundreds of them. I've got plenty of other ways to lose money... I don't have to go use somebody else's invention to lose money.
On Why 'It's a Good Time to Be Old'
Kim: Looking out a couple of decades ahead, when you think about the world that your kids and my kids are growing up in, what are the biggest concerns you see – whether political, financial, economic, or environmental?
Jim: Well, history shows us that no currency has stayed on top as the world's medium of exchange for more than 100, 150 years. So, in the lifetimes of our children, the U.S. dollar is not going to be what it has been in our lifetimes.
That's a concern that I have for them. Not for me... It's a good time to be old, Kim. We don't have to pay for all of this. You know, I'm not going to have to pay any of this staggering debt that the U.S. is incurring. But unfortunately, our kids are going to be faced with huge problems.
A hundred years ago, the U.K. was the richest, most powerful country in the world... There was no No. 2. Fifty years later, the International Monetary Fund had to bail them out. That's going to happen. History is pretty clear about that. So, I certainly worry about it.
I've tried to prepare my children for the 21st century, but who knows? I've taught them to speak Chinese and to know Asia... but who knows? For all I know, it's going to be Venezuela that's the powerhouse during their lifetime. I'm sure there will be many surprises.
On Jim's Travel List
Kim: Now that airplanes are flying again, where do you think are the most interesting places to visit today?
Jim: Well, a place that I would put on your list is North Korea. It's illegal for [U.S. citizens] to go there now. But North Korea is going to be very exciting once they open the 38th parallel. In fact, I would say, the Korean Peninsula is going to be the single most exciting place in the world once they open the 38th parallel.
As recently as 1970, North Korea was richer than South Korea, partly because of the natural resources. Then communism and the Kims ruined everything. They still have the resources, they have the labor. And in the south, they have lots of capital and management ability, right on the Chinese border. I mean, the north and south have about 80 million people.
North and South Korea spend staggering amounts of money on defense. They're going to have a lot of money to spend on other things once the 38th parallel opens, so it's going to be a very, very interesting place. So, if you can go to North Korea, put it on your list.
Kim: Where else?
Jim: Iran could be very exciting. It has a population which is mainly under age 35. It's a very young country, and most of those kids don't like not having beer or not dancing. So, Iran is facing the prospect of great change coming down the road. It's another place where U.S. citizens cannot invest now, as far as I know, not because of the Iranians but because of the U.S.
Venezuela... You might as well go and look around, even though there's not much you can do. I've learned that if you invest in a catastrophe, often you wind up successful... There used to be bonds and stocks in every currency and everything else in Venezuela that one could invest in, but Americans now would be subject to sanctions.
And Zimbabwe. Go to Zimbabwe... [Robert] Mugabe [who ruled Zimbabwe from 1980 to 2017] totally ruined Zimbabwe. Zimbabwe at one time was the richest country in the British colonies, the British Empire, and he ruined it. He completely, unbelievably ruined it.
By the way, I bought a few Zimbabwe shares recently. Not much, but I want to be there because I assume something is going to get better eventually, just not yet.
On How to Stay Sharp, Smart, and Healthy
Kim: Jim, I have one last question, and it's not about finance or investing. You travel, you're as sharp as a tack, and you're not as young as you used to be. [Jim is 79 years old.]
Jim [laughs]: Wait, who told you that?
Kim: What do you do to stay healthy and sharp?
Jim: Well, I don't know if I'm healthy and sharp. I hope I am. I go spend a couple of hours every day in the gym unless I can't, unless I'm traveling. But I guess that's the only answer to your question... You can ask me in 20 years if it worked or not. I do have young, teenage kids. And as you know, teenage kids certainly give you a new perspective on anything, on everything basically, these days. But I mean, my answer to your question is: Have young kids, go to the gym, see the world.
Get yourself a motorcycle and go around the world... That will do it.
May 12, 2022