Fed rate cut dicey for US economy:Rogers

The US economy will head into a "serious'' recession and the dollar will "collapse'' if Federal Reserve Chairman Ben S Bernanke reduces interest rates, investor Jim Rogers said.

"Every time the Fed turns around to save its friends on Wall Street, it makes the situation worse,'' Rogers said in an interview from Shanghai. "If Bernanke starts running those printing presses even faster than he's doing already, yes we are going to have a serious recession. The dollar's going to collapse, the bond market's going to collapse. There's going to be a lot of problems in the U.S.''

The central bank will probably reduce its benchmark interest rate today for the first time in four years, opting for a quarter-point cut to 5 percent, according to the median estimate of 134 economists surveyed by Bloomberg News.

Rogers, the 64-year-old chairman of Beeland Interests, predicted the start of the global commodities rally in 1999.

Fed funds futures contracts show a 50 percent chance that the central bank will lower its benchmark rate to 4.75 percent from 5.25 percent. Traders are certain of a cut of at least a quarter point. The decision is scheduled for about 2:15 p.m. in Washington.

The dollar fell to a record low of $1.3927 per euro on Sept. 13. The U.S. currency has since recouped some of its losses and traded at $1.3866 per euro at 6:37 a.m. in New York today.

Rogers co-founded the Quantum Hedge Fund with George Soros in the 1970s. He traveled the world by motorcycle and car in the 1990s researching investment ideas for his books, which include "Adventure Capitalist'' and "Hot Commodities.''