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Hot Commodities

How Anyone Can Invest Profitably in the World

Jim Rogers
Random House, 2004

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Editorial Rating

9

Qualities

  • Innovative
  • Applicable

Recommendation

Jim Rogers’ book is surprisingly similar in tone to those breathless radio ads inviting you to "invest now" in petroleum futures because bad weather in the northeast is sure to cause a shortage of heating oil. But, Rogers backs up his enthusiasm - dare one say exuberance? - with facts. His record as co-founder of the Quantum Fund speaks for itself. Of course, it doesn’t take an advanced degree to figure out that as China continues its inevitable lumbering jog toward economic hegemony, its appetite for commodities will become insatiable. Hearing it from someone with Rogers’ track record, however, gives it immediacy. Rogers seems to be talking to the general investing public, which may explain the awkward chapters that detour through commodity investment basics, but he heads for more advanced territory soon enough. As the founder of the "The Rogers Raw Materials Index Fund," he would probably relish a run on commodities. That said, Rogers makes a convincing case, and getAbstract.com strongly recommends his book to those looking to diversify into commodities.

Summary

The Road Less Traveled

During the heyday of the 1920s, stocks ran up before anyone could imagine that the Great Depression loomed. Sometime in 1929, Bernard Baruch, legendary investor and presidential advisor, stopped for a shoeshine on his way to the office. The fellow shining Baruch’s shoes started giving him enthusiastic stock tips. Baruch realized that even the shoeshine boy had become a stock tout. When he got back to his office, he sold every stock he owned.

Back Again: The Alternative to Stocks

In the early 1970s, author Jim Rogers sat down with a Harvard Business School graduate who was running a hedge fund. Rogers explained why the time was right to invest heavily in energy. Only a few months later, the OPEC oil embargo occurred and prices skyrocketed. "You sure were lucky," said his friend, who had ignored his advice.

In 1998, it seemed as if certain tech stocks (Cisco, Nortel) were continuing upward, even as others were beginning to slip. Did this mean the boom market was about to break? After extensive research, Rogers found to his surprise that commodities appeared very undervalued. Indeed, they had lost so much Wall Street luster, compared...

About the Author

Jim Rogers grew up in Demopolis, Alabama, won a scholarship to Yale and served in the Army before going to work on Wall Street. He retired at age 37 after co-founding the Quantum Fund, a portfolio that gained more than 4,000% in the 1970s. He wrote Investment Biker and Adventure Capitalist.

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