Roubini’s “Huge” Gold Bubble Versus Rogers’ “Old High” Gold $2,000

A rumble is brewing between Quantum Fund co-founder Jim Rogers and New York University Professor Nouriel Roubini on the important topic of where gold’s headed. Roubini argued just last month that investors are using cheap borrowed dollars to create “huge” bubbles “not justified by the fundamentals” in assets like emerging market equities, oil, and gold.

Rogers, when confronted with the view, replied, “What bubble?” He went on, “it’s clear Mr. Roubini hasn’t done his homework, yet again.” Rogers believes the price of gold will easily increase to “the old high, back in 1980 adjusted for inflation…over $2000…some time in the next decade.”

Although Roubini and Rogers agree that the weak dollar is prompting more commodity and asset investing, they disagree on a bubble in emerging markets. According to Rogers, “they’re certainly all up a lot, maybe they’re too high, but being too high is not a bubble for anyone who knows financial markets.”    

With gold breaking another record today, at roughly $1,095 an ounce, this gold debate is likely to continue. Read more about this war of words in Bloomberg’s coverage of Rogers saying Roubini is wrong on bubbles.

The Daily Reckoning