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Long-Term Bull Market in Stocks? Perhaps Not, Says Jim Rogers

Monday, 11 Feb 2013 | 8:37 PM ET
Jim Rogers: 'Artificial' Stock Gains Won't Last
Dissecting investors' latest behavior, money printing, the debasing of the Japanese yen, and how it impacts market opportunity, with Jim Rogers, author of "Street Smarts"; BobDoll, Nuveen Investments; and Zane Brown, Lord Abbett.

Stellar gains in equity markets do not necessarily signal the start of a long-term bull trend, billionaire investor Jim Rogers told CNBC's "The Kudlow Report," adding that the rally in stocks is just the result of ultra-easy monetary policy by the world's major central banks.

"I am short bonds, but I'm not sure there is going to be a long-term bull market in stocks. There is a lot of money printing," Rogers said. "So this (the rally) is artificial."

(Read More: Why 10-Year Notes Could Suffer a Dramatic Sell-Off)

Since the start of the year, the S&P 500 stock index has gained more than six percent, while the yield on benchmark 10-year U.S. Treasurys has crept higher as investors dump safe-haven assets and snap up riskier ones amid a generally improving outlook for the global economy.

That trend has led some commentators to bet on the start of "Great Rotation" out of bonds and into equity markets.

"I think we may be on the brink of something we haven't seen for a long-time. We have seen the end of bonds as an attractive investment for a long time," Zane Brown, fixed income strategist at Lord Abbett said on "The Kudlow Report."

"There does seem to be great value in equities and we're only starting to see interest," he added.

In Japan, a sharp fall in the yen on expectations of aggressive monetary easing has helped boost the benchmark Nikkei stock index up some 26 percent in the last three months. The Nikkei is up more than 7 percent since the start of the year.

(Read More: Aso: Yen Has Weakened More Than Intended)

"I own (Japanese) shares and they (the Japanese authorities) are making them go through the roof, so in that sense I have to say thank you," Rogers, the author of the book "Street Smarts" said.

"But debasing the currency and printing money is not a good thing," he added, referring to a policy of printing money that leads to currency weakness.

The Bank of Japan last month adopted a 2 percent inflation target to reflect its commitment to fight deflation. It also said it would shift to "open-ended" asset buying – a policy the U.S. Federal Reserve has adopted to revive the world's biggest economy.

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