Bob Brinker and Jim Rogers Differing Opinion on US Treasuries

This weekend Moneytalk host Bob Brinker was asked if the US could default on its debt.  He told the caller they won't default because they won't be able to issue more debt and it would be all over and  "I will say this, if the United States defaults on its debt, I can't give you any reason why anybody in the world should lend a penny to the United States Treasury.....If they actually do that, I can't give you any reason why anybody should invest in a US Treasury." 

A caller asked Brinker if owning US Treasuries was save given the uncertainties with the debt ceiling.  Brinker said he personally doesn't own any US Treasury debt but he would not make a decision to sell or hold based on this debt ceiling issue.

Jim Rogers, the man who correctly predicted the boom in commodities and told Maria Bartiromo on TV years ago to buy farm land in the US, has a completely different view than Bob Brinker .  

From Here's why Jim Rogers says his timing is terrible

Published on Mon, May 23, 2011 at 13:00
Though now known primarily for his bullishness about commodities and China, he has had other investment passions. He was a champion of emerging markets in the 1980s, from Austria to Argentina to the Ivory Coast.
...
Rogers also timed the US property market almost perfectly convinced a bubble had built there. He and Parker sold their home on Riverside Drive, a deal for USD $16 million that closed in December 2007. He had bought the home in January 1977 for USD $1,806,000, at a time the city teetered on bankruptcy and was at its nadir. "They were giving things away," he recalls.
...
Rogers says he is currently long on commodities and currencies, having started to buy the US dollar in the form of Treasury bills in November 2009.
....
He believes the current correction in commodities is a short-term blip in their upward run. That may have years to continue, just as the 1987 crash was a brief respite in a decade-long bull run for stocks.

"What will probably happen is that I will sell my commodities, and they'll double again, then I'll sell them short, then they'll double again because all bubbles go up farther than you expect," he says. "And then, if I don`t get wiped out, they'll fall and I'll make some money."

I find Roger's honesty, compared to Brinker's radio informercial to promote "Moneytalk on Demand" and his "Marketimer" newsletter, refreshing.


Note, I am NOT saying if I agree or disagree with either Brinker or Roger's here.   I am just reporting facts.  You'll have to subscribe to one of my two newsletters to get my opinion on what to do with your fixed income, which depends on your risk tolerance.

BTW, you can save "Moneytalk On Demand" fees by downloading the show for free at the KGO radio archives.

1. Right click 1 - 2 p.m. then "Save Link as" somewhere on your hard drive
2. Right click 2 - 3 p.m. then "Save Link as" somewhere on your hard drive
3. Right click 3 - 4 p.m. then "Save Link as" somewhere on your hard drive

Then listen to it from your hard drive when you have time.

Brinker's guest was Andres Ross Sorkin, author of the book "Too Big to Fail."  The movie debuted on HBO which I recorded on my DVR but have not had time to watch yet.  If anyone would like to write a review of the movie, I'd be happy to publish it here.

Too Big to Fail

"Sorkin's prodigious reporting and lively writing put the reader in the room for some of the biggest-dollar conference calls in history. It's an entertaining book, brisk book...Sorkin skillfully captures the raucous enthusiasm and riotous greed that fueled this rational irrationality." -The New York Times Book Review

"Sorkin's densely detailed and astonishing narrative of the epic financial crisis of 2008 is an extraordinary achievement that will be hard to surpass as the definitive account...as a dramatic close-up, his book is hard to beat." -Financial Times 

New Bond Fund DLTNX DoubleLine

A caller this weekend noted that in Bob's last Marketimer he made a change in the Income Portfolio going to the Double Line Total Return Fund. The caller questioned the reason for that particular fund while noting it had a higher expense ratio. He also questioned the duration.

The new fund is the "DoubleLine Total Return Bond Fund" with a ticker DLTNX for investor shares and DBLTX for institutional shares with $100,000 or more to qualify for the lower expense ratio. We wrote a full report for this call with our warnings about the fund at 

• Bob Brinker - DoubleLine Total Return Bond Fund - DLTNX

MONEYTALK GUEST

THis Sunday Bob had on Harry Nothhaft to discuss his book, "Great Again: Revitalizing America¹s Entrepreneurial Leadership." 

Economic Data - Charts and Graphs

Useful charts and graphs of economic data discussed by Bob Brinker, host of Moneytalk.

• S&P500 PE (Price Earnings) Ratio Graph As a result of the recent surge in corporate earnings, the PE ratio has dropped to a level that has rarely existed over the past two decades.
  
  
• Near Record High Inflation Adjusted Gasoline Prices The only time when gasoline prices were higher than today was during a brief three-month period in mid-2007, just prior to the Great Recession
  
  
• Inflation Adjusted Home Prices - Median single-family home prices adjusted for Inflation
  
  
• Inflation Adjusted Gasoline Prices
  
  
• Inflation Adjusted Oil Prices
  
  
• Single-Family Home Price in Gold
  
  
• US Treasury Rates at a Glance