In 2024, the US stock market has performed strongly, with the S&P 500 index and Nasdaq Composite index both recording double-digit gains year to date. However, renowned investor Jim Rogers issued a warning.

In an interview with ET Now, Rogers expressed his "extreme concern" about the future.

Rogers pointed out, "Since 2008 and 2009, the United States has not experienced any problems - this is the longest in American history." He said, "The United States, as well as the world, should have faced problems long ago

Under such severe predictions, re examining asset allocation may become a focus of attention for ordinary investors. For Rogers, this means prioritizing holding cash.

I have a lot of cash. The reason why I hold a large amount of cash is that I expect the next market sell-off to be the most severe in my life, as global debt has risen sharply, "he said.

The rise in global debt, especially the debt of the United States, further supports his concerns. According to the latest financial data, the US treasury bond has reached 35.21 trillion US dollars.

Hoard cash

Rogers has extensive experience in dealing with turbulent times. He co founded Quantum Fund with George Soros in 1973, during a severe bear market. From then until 1980, the investment portfolio returned 4200%, while the S&P 500 index only rose by 47%.

In the interview, Rogers mentioned that despite holding a large amount of cash, he is not in a hurry to put it into the market.

I haven't spent my cash yet. I hope to have more cash because, to reiterate, the next market crash will be the most severe of my life, "he emphasized.

Rogers is not the only well-known investor holding cash.

Warren Buffett's Berkshire Hathaway also holds a large amount of cash reserves. According to Berkshire Hathaway's latest quarterly report, as of June 30, 2024, the company's cash and cash equivalents reached $224.2 billion, an increase from $1218 billion in 2023.

However, there may still be some profitable areas in the market.

If I buy today... "Buffett's cash accumulation does not necessarily indicate a bearish outlook. But for Rogers, his strategy is based on concerns about the sustainability of a sustained bull market.

Everywhere has always been very good. In history, when everyone made a lot of money, it was always a time to worry, so I was very worried, "Rogers explained.

Despite being cautious, Rogers pointed out that there are still some potential opportunities in the market.

If I were to buy today - and I haven't - I might buy silver or agriculture, "he revealed.

Precious metals such as gold and silver are often considered safe haven assets against inflation because they cannot be printed by central banks like legal tender. In 2024, gold attracted a large number of investors' attention, pushing its price to a new high.

Although silver has experienced a round of rise this year, it is still far below its historical high. Rogers pointed out that this difference was the key reason for his interest in the metal.

Rogers said, "Silver is 40% or 50% lower than its historical peak... Gold has reached a new historical high. Silver is falling - it's hard to find something that's causing a price drop

Rogers' interest in agriculture follows a similar logic. I am optimistic about agriculture because it has been in a slump, "he pointed out.

Although agriculture is not commonly seen in financial media, it plays a crucial role in the global economy. After all, food is a necessity, and investing in agriculture may be a way to leverage industries that are still crucial in the economic cycle.

Tips

James Beeland Rogers Jr. (born October 19, 1942) is a renowned American investor, economist, traveler, university professor, and writer. He co founded Quantum Fund with Soros and is known for investing in commodity futures, earning the nickname "Commodity King".

Rogers ventured into Wall Street alone at the age of 26 and co founded the world's top hedge fund, Quantum Fund, with Soros. Over the course of 10 years, he earned astonishing returns of 42 times and accurately predicted the 1987 global stock market crash and the US subprime mortgage crisis. He is known as one of the top three global investors along with Buffett and Soros.

Stock god Buffett even admired his reputation and listened to his lectures, evaluating his "unparalleled ability to grasp the general trend of the times". And Rogers' wisdom and judgment are based on the "streets and alleys": Rogers, who is over 80 years old, has traveled around the world twice and visited China four times, seeking opportunities while traveling and making a living on Earth.