The U.S. dollar is going to be a "total disaster" in the long term because of the country's position as the world's largest debtor and the policies being pursued by Federal Reserve Chairman Ben S. Bernanke, according to investor Jim Rogers.
The Chinese yuan is likely to be a "safe" currency, although it is difficult for investors to buy, Rogers, the chairman of Rogers Holdings, told a conference in Edinburgh.
"The situation is getting worse and I expect to see severe problems in the U.S.," Rogers said today. "Dr Bernanke doesn't understand economics, he doesn't understand finance, he only understands printing money and we can't quadruple the amount of money in the next slowdown."
U.S. government debt is currently 93 percent of gross domestic product compared with 60 percent before the financial crisis and is set to rise further in the next few years. The dollar has fallen over the past year against every currency in a basket of 16 major currencies. The euro has gained about 7 percent against the dollar this year. It traded at $1.4311 as of 3:20 p.m. in London.
"I expect to see more currency turmoil maybe this fall, and more turmoil by 2013," said Rogers, who favors currencies and commodities. Rogers said he is currently buying the dollar because the market consensus is for the currency to fall.