NEW YORK ( TheStreet ) - Jim Rogers, financial commentator, author and contrarian investor, loves commodities, but after the recent commodity carnage, does he still?

Gold prices fell 4.2% last week, silver prices plummeted 27%, and oil tanked 14.7%. As silver was smacked with an 85% increase in margin requirements in two weeks, Osama Bin Laden was killed removing some risk premium from the markets, over-crowded commodity trades shook out and the U.S. dollar index rallied, commodities took a nose dive.

The SPDR Gold Shares ( GLD - Get Report) shed almost 25 tons in 5 days while iShares Silver Trust ( SLV - Get Report) dumped 767 tons.

TheStreet sat down in an interview with Rogers to see if the recent correction changed his view on the bull market in commodities.

I wanted to start off with last week's commodity carnage, what does that tell you about the commodity trade?

Rogers: Well, not much if you ask me. Markets correct all the time. Silver went down a great deal but if you raise margin requirements 150%-200% you would expect there's something to collapse. It's good for the market as far as I'm concerned. Silver especially needed a set back and a consolidation. I'm delighted to see everything.

So this wasn't one current bubble that then burst at that time?

Rogers: I hardly see how silver could be a bubble when, even as its top, is still below it's all time high. That's not much of a bubble. A bubble is when things are screaming up every day and they go to new highs, two to three times their old highs. We'll have a bubble, we'll have a bubble in commodities, we're not there yet.

What price do you think silver will hit that would make it a bubble?

Rogers: Well, it depends on the timing. If it goes to $150 this year, all other things being equal, then I'd say you better sell your silver. If it goes to $150 in 10 years then I would say that's a normal progression up and that's the way things work. But if the U.S. dollar suddenly turns into confetti then you better hold your silver at $200. So it depends on the circumstances and the timing more than anything else.

Now talking to a lot of technical traders when they looked at the silver chart, say over the last year, they saw that parabolic rise which made them really think it was a bubble. Also, to your point, we have talked about this before, when you hear people talking on the street about say pork bellies that means we are in a bubble. I heard stories of people talking on the street on their cell phones talking about silver last week hoping it would go higher so they could sell.

Rogers: Oh, I was hoping it would go down so I could buy ...I was on some show talking about how this parabolic bubble better stop soon. But Ms. Steel, how many people do you know who actually own silver? I suspect you don't know man y people at all. I spoke recently at a conference with 400 big time money managers around the world.

The moderator said how many of you have ever owned gold? Seventy six percent of them had never owned gold much less silver or soybeans or cotton, so I suspect you don't know anybody who owns silver. Someday you'll know a lot of people who own silver, everybody you know. That will be a bubble, that's the time to sell.

So was silver's parabolic rally we saw then more of a trader bubble?

Rogers: I'm not sure I would call it parabolic, I would certainly call it a spike, it didn't quite reach parabolic status in my view, but it certainly was a gigantic crazy spike. When something goes up 25%-30% in a month, that's something to worry about a great deal. I don't know what caused it maybe it was short covering, maybe it was rumors. I have no idea. I know that 25% in a month is dangerous.

So silver fell 27% last week, was it enough for you to want to buy more?

Rogers: Well, I'm too lazy, I'm doing other things right now, but I hope at some time in the next month or two if it goes down or stays down then I will get the energy to go around and buy some more silver, yes. Or maybe it will go to $25, I don't know

But you didn't sell anything?

Rogers: No, no, no I have not sold any commodities. I protect myself by being short ... in other things. I am nearly always short something. I'm nearly always long something, fortunately my shorts went down too last week.

So what are you short versus long?

Rogers: Well, I'm short emerging markets and I'm short American technology stocks cause those are two areas of the world stock markets that have been very over-exploited in the past two to three years. They're not great bubbles, they're not great shorts, but they're better shorts than nothing.

Then what are you long? Commodities then?

Rogers: I'm long commodities, mainly its commodities and currencies.

Now you've been saying that there is no oil and that's why oil prices are going up. What did you specifically mean by that?

Rogers:Well, there have been no new elephant discoveries in over 40 years. All the great oil fields in the world are in decline now and unless we find a lot of oil quickly then we're not going to have any oil at any price. The International Energy Agency is going around saying "look, the world is running out of known reserves at 6% a year."

Well, say its 4% a year, say they're wrong. I mean in 25 years, Ms. Steel, we won't have any oil at any price unless someone does something very quickly that's all I mean, there's no oil, there's no new oil.

It just seems like if that's the case then natural gas prices should be through the roof in preparation of a lack of oil?

Rogers: Well, there is a short term glut of natural gas, but you're exactly right, people are going to have to use other forms of energy and if I were looking at energy markets right now I would start by looking at natural gas cause its way down and oil is way up.

So how high will oil go on this supply issue?

Rogers: Oh, if I told you how high the price of oil would go over the next decade, you'd stop talking to me, you wouldn't believe me. "He's finally lost it, he's gone over the deep end."

Do the arithmetic. If reserves are going to continue to climb at 4%-5%-6% a year, in 10 years there is going to be very little oil left. Now we would have brought in alternate sources such as natural gas and other things but we are still going to be in a bad bind. Prices are going to be very high.

Eventually prices will go so high that people will probably start finding new oil ... if oil goes to $200, they'll drill on the White House lawn, $300 drill at Buckingham Palace. Hopefully, someday, we'll find more oil, or more sources of energy and people will cut back at the same time.

So natural gas would be the one you'd focus on?

Rogers: I would start by looking at natural gas or maybe uranium. Uranium has been pounded down recently for obvious reasons. It will probably have to sit around on the bottom for a while but that's another place that's very depressed. And we are going to have to have nuclear power whether we like it or not.

But say wind and solar don't make it on your list?

Rogers: No, of course it does ... but wind and solar are not economically competitive at these prices. Now if prices go higher and higher of course, they'll be very competitive and, of course, governments love wind and solar, so they will subsidize. If you can find competent people in that business, you'll make a fortune.

I know I've been harping on gold, silver, and oil but what is your favorite commodity? The one you think that has the most upside long term?

Rogers: If I were looking for new commodities now I would start by looking at the things that are depressed. Natural gas, you picked an obvious place to start, I would look at things like rice, rice is very depressed ... silver's cheaper than gold on a historic basis.

I would start looking at those places. I always like to start with the things that are the most depressed, doesn't mean I'll buy them, doesn't mean that they should be even looked at but that's where I start. I don't like to start with the things that are making new highs. By the way, there are plenty of great investors who do invest that way, they are momentum players. They jump in and get on a moving train, I'm scared to death to get on a moving train and if I do I always get hurt.

Check back for my next Q&A with Jim Rogers on currencies and the fate of the U.S.

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-- Written by Alix Steel in New York.

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