Rogers: QE3 is already here, Alix. Get out the numbers for non-seasonally adjusted M2 and you will see that Mr. Bernanke said that in the summer we are going to keep rates artificially low. Now you can't just say the words. You've got to do something. And so they went into the market. The money supply numbers skyrocketed. They are in there. They are in there buying already. You can't just say the words. You've got to do something and they are in there buying. And that's why M2 has exploded. They are already easing and they may ease some more. Again, I told you, the worst risk facing us is the United States central bank which doesn't have a clue what they are doing.
And to your point the M2 supply is over $9.5 trillion, up 20% since November 2008. However, then why are you long the dollar?
Rogers: I am long the dollar because of all of the chaos going on around the world and because people dumped the dollar. There was lots of selling. Everybody is bearish on the dollar including me. I am the biggest bear in the world on the dollar but when I saw everybody too bearish, I bought dollars. There is this chaos and I am afraid there is going to be more flight capital. People see the dollar as a safe haven. It's not a safe haven. But since it's still in people's mind that's why I still own the dollar. But when people start getting exuberant about the dollar, if they do, I'll sell my dollars and I may never own the dollar again.
So what should the U.S. government do right now, with the Fed on the wrong policy, with jobs still really bad in the U.S. and with growth moderating, what should the U.S. government do?Rogers: They should abolish the Federal Reserve. That would be the first thing they should do. They are not going to do that but what they should do is let interest rates find their normal rate, their realistic level. Right now masses of people in America, the people who save and invest, the people who we would say have done the right thing, are being destroyed because
>To contact the writer of this article, click here: Alix Steel.
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