May 12, 2015
Marc Faber - Gloom Boom & Doom Report and his views on US Bonds, Currencies and Gold Miners
US Treasuries: Contrarian Bet Against Market Consensus
In May’s Gloom Boom & Doom report, Marc Faber starts the market observations part of the report with a chart and analysis of the latest Barron’s Big Money Poll.
In the Barron’s latest Big Money poll (see Barron’s of April 24, 2015),
Read more: Octafinance.com
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
February 13, 2014
Marc Faber interview, treasury short term better than equities
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
January 29, 2014
More from Marc Faber from the Barrons Roundtable 2014
Via Barron's,
Faber: This morning, I said most people don't benefit from rising stock prices. This handsome young man on my left said I was incorrect. [Gabelli starts preening.] Yet, here are some statistics from Gallup's annual economy and personal-finance survey on the percentage of U.S. adults invested in the market. The survey, whose results were published in May, asks whether respondents personally or jointly with a spouse have any money invested in the market, either in individual stock accounts, stock mutual funds, self-directed 401(k) retirement accounts, or individual retirement accounts. Only 52% responded positively.
Gabelli: They didn't ask about company-sponsored 401(k)s, so it is a faulty question.
Faber: An analysis of Federal Reserve data suggests that half the U.S. population has seen a 40% decrease in wealth since 2007.
In Reminiscences of a Stock Operator [a fictionalized account of the trader Jesse Livermore that has become a Wall Street classic], Livermore said, "It never was my thinking that made the big money for me. It was always my sitting. Got that? My sitting tight." Here's another thought from John Hussmann of the Hussmann Funds: "The problem with bubbles is that they force one to decide whether to look like an idiot before the peak, or an idiot after the peak. There's no calling the top, and most of the signals that have been most historically useful for that purpose have been blaring red since late 2011."
I am negative about U.S. stocks, and the Russell 2000 in particular. Regarding Abby's energy recommendation, this is one of the few sectors with insider buying. In other sectors,statistics show that company insiders are selling their shares like crazy, and companies are buying like crazy.
Zulauf: These are the same people.
Faber: Precisely. Looking at 10-year annualized returns for U.S. stocks, the Value Line arithmetic index has risen 11% a year. The Standard & Poor's 600 and the Nasdaq 100 have each risen 9.4% a year. In other words, the market hasn't done badly. Sentiment figures are extremely bullish, and valuations are on the high side.
But there are a lot of questions about earnings, both because of stock buybacks and unfunded pension liabilities. How can companies have rising earnings, yet not provision sufficiently for their pension funds?
Good question. Where are you leading us with your musings?
Faber: What I recommend to clients and what I do with my own portfolio aren't always the same. That said, my first recommendation is to short the Russell 2000. You can use the iShares Russell 2000 exchange-traded fund [IWM]. Small stocks have outperformed large stocks significantly in the past few years.
Next, I would buy 10-year Treasury notes, because I don't believe in this magnificent U.S. economic recovery. The U.S. is going to turn down, and bond yields are going to fall. Abby just gave me a good idea. She is long the iShares MSCI Mexico Capped ETF, so I will go short.
Faber: This morning, I said most people don't benefit from rising stock prices. This handsome young man on my left said I was incorrect. [Gabelli starts preening.] Yet, here are some statistics from Gallup's annual economy and personal-finance survey on the percentage of U.S. adults invested in the market. The survey, whose results were published in May, asks whether respondents personally or jointly with a spouse have any money invested in the market, either in individual stock accounts, stock mutual funds, self-directed 401(k) retirement accounts, or individual retirement accounts. Only 52% responded positively.
Gabelli: They didn't ask about company-sponsored 401(k)s, so it is a faulty question.
Faber: An analysis of Federal Reserve data suggests that half the U.S. population has seen a 40% decrease in wealth since 2007.
In Reminiscences of a Stock Operator [a fictionalized account of the trader Jesse Livermore that has become a Wall Street classic], Livermore said, "It never was my thinking that made the big money for me. It was always my sitting. Got that? My sitting tight." Here's another thought from John Hussmann of the Hussmann Funds: "The problem with bubbles is that they force one to decide whether to look like an idiot before the peak, or an idiot after the peak. There's no calling the top, and most of the signals that have been most historically useful for that purpose have been blaring red since late 2011."
I am negative about U.S. stocks, and the Russell 2000 in particular. Regarding Abby's energy recommendation, this is one of the few sectors with insider buying. In other sectors,statistics show that company insiders are selling their shares like crazy, and companies are buying like crazy.
Zulauf: These are the same people.
Faber: Precisely. Looking at 10-year annualized returns for U.S. stocks, the Value Line arithmetic index has risen 11% a year. The Standard & Poor's 600 and the Nasdaq 100 have each risen 9.4% a year. In other words, the market hasn't done badly. Sentiment figures are extremely bullish, and valuations are on the high side.
But there are a lot of questions about earnings, both because of stock buybacks and unfunded pension liabilities. How can companies have rising earnings, yet not provision sufficiently for their pension funds?
Good question. Where are you leading us with your musings?
Faber: What I recommend to clients and what I do with my own portfolio aren't always the same. That said, my first recommendation is to short the Russell 2000. You can use the iShares Russell 2000 exchange-traded fund [IWM]. Small stocks have outperformed large stocks significantly in the past few years.
Next, I would buy 10-year Treasury notes, because I don't believe in this magnificent U.S. economic recovery. The U.S. is going to turn down, and bond yields are going to fall. Abby just gave me a good idea. She is long the iShares MSCI Mexico Capped ETF, so I will go short.
...
What are you doing with your own money?
Faber: I have a lot of cash, and I bought Treasury bonds.
...
Faber: I have no faith in paper money, period. Next, insider buying is also high in gold shares. Gold has massively underperformed relative to the S&P 500 and the Russell 2000. Maybe the price will go down some from here, but individual investors and my fellow panelists and Barron's editors ought to own some gold. About 20% of my net worth is in gold. I don't even value it in my portfolio. What goes down, I don't value.
...
Which stocks are you recommending?
Faber: I recommend the Market Vectors Junior Gold Miners ETF [GDXJ], although I don't own it. I own physical gold because the old system will implode. Those who own paper assets are doomed.
Zulauf: Can you put the time frame on the implosion?
Faber: Let's enjoy dinner tonight. Maybe it will happen tomorrow.
...
There is a colossal bubble in assets. When central banks print money, all assets go up. When they pull back, we could see deflation in asset prices but a pickup in consumer prices and the cost of living. Still, you have to own some assets. Hutchison Port Holdings Trust yields about 7%. It owns several ports in Hong Kong and China, which isn't a good business right now. When the economy slows, the dividend might be cut to 5% or so. Many Singapore real-estate investment trusts have corrected meaningfully, and now yield 5% to 6%. They aren't terrific investments because property prices could fall. But if you have a negative view of the world, and you think trade will contract, property prices will fall, and the yield on the 10-year Treasury will drop, a REIT like Hutchison is a relatively attractive investment.
...
Faber: The outlook for property in Asia isn't bad because a lot of Europeans realize they will need to leave Europe for tax reasons. They can live in Singapore and be taxed at a much lower rate. Even if China grows by only 3% or 4%, it is better than Europe. People are moving up the economic ladder in Asia and into the middle class.
Are you bullish on India?
Faber: I am on the board of the oldest India fund [the India Capital fund]. The macroeconomic outlook for India isn't good, but an election is coming, and the market always rallies into elections. The leading candidate is pro-business. He is speaking before huge crowds.
In dollar terms, the Indian market is still down about 40% from the peak, because the currency has weakened. In the 1970s, stock market indexes performed poorly and stock-picking came to the fore. Asia could be like that now. It is a huge region, and you have to invest by company. Some Indian companies will do well, and others poorly. Some people made 40% on their investments in China last year, but the benchmark index did poorly.
I like Vietnam. The economy has had its troubles, and the market has seen a big decline. I want you to visualize Vietnam. [Stands up, walks to a nearby wall, and begins to draw a map of Vietnam with his hands.] Here's Saigon, or Ho Chi Minh City, the border with China, and the Mekong River. And here in the middle, on the coast, is Da Nang.
...
Faber: I recommend shorting the Turkish lira. I had an experience in Turkey that led me to believe that some families are above the law. When I see that in an emerging economy, it makes me careful about investing.
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
January 28, 2014
Marc Faber sees value in gold miners
Doom master Marc Faber expressed his ideas at the Barron's Roundtable 2014, Marc Faber does, however, lean against Felix Zulauf's recommendation to short the Hong Kong ETF (EWH) as a play on a credit bust in China. Property companies are a big component of the Hong Kong stock market, says Marc Faber, and may have already priced in an implosion as they're selling for just 40-50% of asset values. "I would rather buy Hong Kong shares and short the Nasdaq," says Marc Faber.
It goes without saying that Faber is bullish on gold, but he's a bigger fan of the miners (GDX) recently. Marc Faber is probably bullish on the miners as they are selling at a discount to gold. There is also fast pace of insider buying in the industry. A member of the board at Sprott, Faber says Eric Sprott has been selling company stock to buy shares in small miners (GDXJ). "If the gold price goes up 30%, Sprott's shares might double, but mining stocks could go up four times."
It goes without saying that Faber is bullish on gold, but he's a bigger fan of the miners (GDX) recently. Marc Faber is probably bullish on the miners as they are selling at a discount to gold. There is also fast pace of insider buying in the industry. A member of the board at Sprott, Faber says Eric Sprott has been selling company stock to buy shares in small miners (GDXJ). "If the gold price goes up 30%, Sprott's shares might double, but mining stocks could go up four times."
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
December 02, 2013
Faber: The market may rise by 20% before the crash
Marc Faber, publisher of The Gloom, Boom & Doom Report, and known " bearish " investor attitudes, told CNBC, that massive speculative bubble of emergency liquidity is hanging over everything - from stocks and bonds to agricultural land and the virtual currency Bitcoin.
Faber says that the markets have reached record levels can rise even before the bubble burst , if you continue the program of the Federal Reserve massive bond purchases , as well as ultra-low interest rates.
"The market may rise by 20 % before the crash. Maybe more if you continue printing money, "said Faber.
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
Faber says that the markets have reached record levels can rise even before the bubble burst , if you continue the program of the Federal Reserve massive bond purchases , as well as ultra-low interest rates.
"The market may rise by 20 % before the crash. Maybe more if you continue printing money, "said Faber.
He cautions investors that may see disappointing stock returns over the long term.
"Agricultural land has appreciated ten times in the last 10 years, and Bitcoin are up and who knows what are the limits," says Faber.
In recent interviews he predicted that European stocks will perform better than those of the U.S. and emerging markets.
Faber also believes that the credit boom in China puts the world in a worse situation than before the global financial crisis in 2008.
"Agricultural land has appreciated ten times in the last 10 years, and Bitcoin are up and who knows what are the limits," says Faber.
In recent interviews he predicted that European stocks will perform better than those of the U.S. and emerging markets.
Faber also believes that the credit boom in China puts the world in a worse situation than before the global financial crisis in 2008.
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
October 27, 2013
Mark Faber Fears "Stocks Could Be Dead Money For A While" But "Gold Has Bottomed"
On Gold and Gold Miners:
Gold peaked at $1,921 an ounce in September 2011. Since then, it has been in a correction mode. Sentiment is bearish, but some countries are accumulating gold, notably China, which will buy an estimated 2,600 tons this year, exceeding annual production. Prices probably are bottoming.
Gold-mining shares aren't expensive either, although many exploration companies won't make it. If you buy the miners, look for companies that have raised capital already or have sufficient reserves. They are best-positioned to survive the next few years if there is no upturn in the gold price.
Full Barrons' Interview below:
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
October 18, 2013
Faber: Apple could face bankruptcy
" Apple shares are those you are not interested ," Faber said in an interview quoted by Business Insider. " I'm not saying that they will sink , but may get there eventually ," said another prominent investor.
According to Marc Faber eventual fate of Apple has a similar example from the past.
" It's like a Polaroid of the 70s . Eventually she , like Apple, has been founded and led by renowned innovator who eventually left her," recalls Faber.
"Dr. Edwin Land, who is the founder of Polaroid, was the owner of more patents than any other in the world," said Marc Faber.
1982 Land left his seat on the Board of Directors of Polaroid, and subsequently dropped from his research position at the company. In 2001 and famous for its production of sunglasses company filed for bankruptcy protection and continue to sell its assets.
At present, Apple certainly is a far cry from the fate of Polaroid. The technology giant has current assets of $ 43 billion. Her only income in the second quarter of 2013 even reached $ 35 billion.
Faber argues that the technology industry is full of " tombstones " of ekspazarni leaders. "We and many other examples of high-tech companies that simply disappeared," said the investor.
According to Faber biggest issue of Apple is that its products are not suited to human needs.
" It's just a company that produces toys for grown-ups," said popular investor.
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
October 05, 2013
Marc Faber: Growth in China is rather 4%
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
September 25, 2013
Marc Faber Warns "The Endgame Is a Total Collapse - But From a Higher Diving Board Now"
Marc Faber on taper:
"My view was that they would taper by about $10 billion to $15 billion, but I'm not surprised that they don't do it for the simple reason that I think we are in QE unlimited. The people at the Fed are professors, academics. They never worked a single life in the business of ordinary people. And they don't understand that if you print money, it benefits basically a handful of people maybe--not even 5% of the population, 3% of the population. And when you look today at the market action, ok, stocks are up 1%. Silver is up more than 6%, gold up more than 4%, copper 2.9%, crude oil 2.68%, and so forth. Crude oil, gasoline are things people need, ordinary people buy everyday. Thank you very much, the Fed boosts these items that people need to go to their work, to heat their homes, and so forth and at the same time, asset prices go up, but the majority of people do not own stocks. Only 11% of Americans own directly shares."
On Interest rates
"On September 14, 2012, when the Fed announced QE3, that was then extended into QE4, and now basically QE unlimited, the bond markets had peaked out. Interest rates had bottomed out on July 25, 2012--a year ago--at 1.43% on the 10-year Treasury note. Mr. Bernanke said at that time at a press conference, the objective of the Fed is to lower interest rates. Since then, they have doubled. Thank you very much. Great success."
On the final
"Well, the endgame is a total collapse, but from a higher diving board. The Fed will continue to print and if the stock market goes down 10%, they will print even more. And they don't know anything else to do. And quite frankly, they have boxed themselves into a corner where they are now kind of desperate."
On Janet Yellen:
"She will make Mr. Bernanke look like a hawk. She, in 2010, said if could vote for negative interest rates, in other words, you would have a deposit with the bank of $100,000 at the beginning of the year and at the end, you would only get $95,000 back, that she would be voting for that. And that basically her view will be to keep interest rates in real terms, in other words, inflation-adjusted. And don't believe a minute the inflation figures published by the bureau of labor statistics. You live in New York. You should know very well how much costs of living are increasing every day. Now, the consequences of these monetary policies and artificially low interest rates is of course that the government becomes bigger and bigger and you have less and less freedom and you have people like Mr. De Blasio, who comes in and says let's tax people who have high incomes more. And, of course, immediately, because in a democracy, there are more poor people than rich people, they all applaud and vote for him. That is the consequence."
On gold direction:
"When I look at the market action today, I would like to see the next few days, because it may be a one-day event. The markets are overbought. The Feds have already lost control of the bond market. The question is when will it lose control of the stock market. So, I'm a little bit apprehensive. I would like to wait a few days to see how the markets react after the initial reaction." On 10 year treasuries "I will confess to you, longer-term, I am of course, negative about government bonds and i think that yields will go up and that eventually there will be sovereign default. But in the last few days, when yields went to 2.9% and 3% on the 10-year for the first time in years i bought some treasuries because I have the view that they overshot and that they could ease down to around 2.2% to 2.5% because the economy is much weaker than people think…I think in the next three months or so." On gold prices: "I always buy gold and I own gold. I don't even value it. I regard it as an insurance policy. I think responsible citizens should own gold, period." Marc Faber: "Fed's Neo-Keynesian Clowns... Are Holding The World Hostage"
"There is nothing safe anymore, because the money-printing distorts all asset prices," is the uncomfortable response Marc Faber gives to Thai TV during this interview when asked for investment ideas. Faber explains how we got here "massive money-printing and ZIRP creates a huge pool of liquidity that does not flow evenly," as it washes from Nasdaq stocks to real estate to emerging markets and so on. Each time, "the bubble inflates and then is deflated as the capital (liquidity) floods out." The Fed, based on the doubling of interest rates since they began QE3 "has lost control of the bond market," Faber warns; adding that while he expects some "cosmetic tapering," the Fed members and other neo-Keynesian clowns will react to a "weakening US and global economy," and we will be a $150 billion QE by the end of next year, as the world is held hostage to US monetary policy. The interview is interspersed with Thai translation but is well worth the time (starting at 1:25):
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
"My view was that they would taper by about $10 billion to $15 billion, but I'm not surprised that they don't do it for the simple reason that I think we are in QE unlimited. The people at the Fed are professors, academics. They never worked a single life in the business of ordinary people. And they don't understand that if you print money, it benefits basically a handful of people maybe--not even 5% of the population, 3% of the population. And when you look today at the market action, ok, stocks are up 1%. Silver is up more than 6%, gold up more than 4%, copper 2.9%, crude oil 2.68%, and so forth. Crude oil, gasoline are things people need, ordinary people buy everyday. Thank you very much, the Fed boosts these items that people need to go to their work, to heat their homes, and so forth and at the same time, asset prices go up, but the majority of people do not own stocks. Only 11% of Americans own directly shares."
On Interest rates
"On September 14, 2012, when the Fed announced QE3, that was then extended into QE4, and now basically QE unlimited, the bond markets had peaked out. Interest rates had bottomed out on July 25, 2012--a year ago--at 1.43% on the 10-year Treasury note. Mr. Bernanke said at that time at a press conference, the objective of the Fed is to lower interest rates. Since then, they have doubled. Thank you very much. Great success."
On the final
"Well, the endgame is a total collapse, but from a higher diving board. The Fed will continue to print and if the stock market goes down 10%, they will print even more. And they don't know anything else to do. And quite frankly, they have boxed themselves into a corner where they are now kind of desperate."
On Janet Yellen:
"She will make Mr. Bernanke look like a hawk. She, in 2010, said if could vote for negative interest rates, in other words, you would have a deposit with the bank of $100,000 at the beginning of the year and at the end, you would only get $95,000 back, that she would be voting for that. And that basically her view will be to keep interest rates in real terms, in other words, inflation-adjusted. And don't believe a minute the inflation figures published by the bureau of labor statistics. You live in New York. You should know very well how much costs of living are increasing every day. Now, the consequences of these monetary policies and artificially low interest rates is of course that the government becomes bigger and bigger and you have less and less freedom and you have people like Mr. De Blasio, who comes in and says let's tax people who have high incomes more. And, of course, immediately, because in a democracy, there are more poor people than rich people, they all applaud and vote for him. That is the consequence."
On gold direction:
"When I look at the market action today, I would like to see the next few days, because it may be a one-day event. The markets are overbought. The Feds have already lost control of the bond market. The question is when will it lose control of the stock market. So, I'm a little bit apprehensive. I would like to wait a few days to see how the markets react after the initial reaction." On 10 year treasuries "I will confess to you, longer-term, I am of course, negative about government bonds and i think that yields will go up and that eventually there will be sovereign default. But in the last few days, when yields went to 2.9% and 3% on the 10-year for the first time in years i bought some treasuries because I have the view that they overshot and that they could ease down to around 2.2% to 2.5% because the economy is much weaker than people think…I think in the next three months or so." On gold prices: "I always buy gold and I own gold. I don't even value it. I regard it as an insurance policy. I think responsible citizens should own gold, period." Marc Faber: "Fed's Neo-Keynesian Clowns... Are Holding The World Hostage"
"There is nothing safe anymore, because the money-printing distorts all asset prices," is the uncomfortable response Marc Faber gives to Thai TV during this interview when asked for investment ideas. Faber explains how we got here "massive money-printing and ZIRP creates a huge pool of liquidity that does not flow evenly," as it washes from Nasdaq stocks to real estate to emerging markets and so on. Each time, "the bubble inflates and then is deflated as the capital (liquidity) floods out." The Fed, based on the doubling of interest rates since they began QE3 "has lost control of the bond market," Faber warns; adding that while he expects some "cosmetic tapering," the Fed members and other neo-Keynesian clowns will react to a "weakening US and global economy," and we will be a $150 billion QE by the end of next year, as the world is held hostage to US monetary policy. The interview is interspersed with Thai translation but is well worth the time (starting at 1:25):
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
August 09, 2013
Marc Faber predicts another "Black Monday" by the end of the year
Marc Faber again makes pessimistic forecasts, writes MarketWatch. , Known as Dr. Doom, author of The Gloom, Boom & Doom Report, warning investors to prepare for a drop in the markets of 20% or more by the end of 2013 Faber predicted market crash like the one seen in 1987"In 1987 we had a significant increase in stock prices. Profits, however, did not grow at a stable rate. Markets were overvalued. There was a sharp decline, and on August 25 was the last day on which a large number of shares registered 52-week low. In other words, the number of shares that rose, curled up and saw a number of disruptions to trade with different shares, "said in an interview with CNBC Marc Faber
October 1987 was a period that investors can not so easily forget. YTD broader index S & P 500 added 20% to its value. Faber comparison with 1987, when the market grew by 30% at the same time of year.
On October 19, 1987, the day known as "Black Monday", S & P 500 index dropped sharply by 20%. This event remains forever in the history of Wall Street as the biggest loss suffered in exchange for one day. It was the end of five years-long period of appreciation of the shares.
Faber notes that in just two days this week, when the S & P 500 hit historic high of 1,709 points, there were 170 issues, which were trading at 52-week lows. This means that only a few companies moving market.
Back in February, and then a few more times, Marc Faber make such negative predictions, but none of them came true. Analysts wonder how much longer he will play the role of the false shepherd before something actually happen?
Analyst at Schaeffer's Investment Research Ryan Detrick did make quite a different conclusion. According to him, just as in 1987, and now the index Dow Jones Industrial Average has almost doubled. Today, however, market participants behave differently compared to the year in question.
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
June 25, 2013
Marc Faber: The Stock Market is Risky
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
June 24, 2013
Marc Faber Video: Gloom Boom & Doom - S&P 500 Could Fall 20% to 30%
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
June 22, 2013
Marc Faber Likes Bonds, Gold More Than Equities
"If you believe that Bernanke means what he says," says Gloom, Boom, and Doom's Marc Faber, "then you believe in Father Christmas." Faber adds that, "we are going to see QE99," and while he states that equities, bonds, and gold are "very oversold," he prefer to buy bonds and gold than equities. Marc Faber also warns that "the S&P could drop 20-30% from the recent highs – without much of a problem."
"The only thing that I know is that I want to own some physical gold because I don't want all of my assets in financial assets."
Marc Faber thoughts about the markets:
"Well, right now equities, bonds and gold are very oversold. They can easily rally on the S&P. We could rally 43, 50 points, but I don't expect a new high. Just in case a new high would be achieved in the next two months or so, it would not be confirmed by the majority of shares. In other words, very few stocks would lead the advance. In terms of bonds, they are also incredibly oversold. Where the sentiment about equities is actually still rather positive and all of these super bulls still predicting the market to continue to rise into 2014, 2015. In bonds and gold, sentiment is by historical standards incredibly negative. As a contrarian, I would rather buy bonds and gold than equities."
His comments on bonds and QE tappering:
"If you say that if he means what he says, then you believe in Father Christmas. He said if the economy does not meet the expectations of the fed in one years' time, they will consider additional measures. In other words, if the economy has not fully recovered by mid-2014, more QE will be forthcoming. As I said already three years ago, we are going to go with the Fed to QE99."
Is Marc Faber worried about inflation?
"Well, I think investors have a misconception about what inflation is because it is essentially an increase in the quantity of money and credit. We have wage deflation in the world in real terms, for sure. In other words, real wages are going down and the cost of living everywhere are going up. That is why you have social unrest in North Africa, in the Middle East, in Turkey, in Brazil, and it will spread because the average person on the street hasn't participated in the huge asset inflation that has been going on in high-end properties, Mayfair properties, Fifth Avenue, Madison Avenue, the Hamptons and in equities and until recently in bonds and commodities."
Marc Faber on gold down moves:
"To that I respond there are many people out there, they never owned an ounce of gold in their lives. They were bearish about gold at $300, bearish about gold at $700, bearish about the stock market in 2009 when the S&P was at 666. Now, they are bullish about stocks and they are still bearish about gold. The commercial hedgers - these are professional miners, mining companies and people involved in gold trading. They have the lowest short exposure, since 2001 when gold was at $300. Similarly, in the silver market, the commercial hedgers, again, the professionals have the lowest short exposure since 2001. I would rather bet on the commercial miners, the commercial hedgers than on some forecaster who knows about the future of prices as little as I know. The only thing that I know is that I want to own some physical gold because I don't want all of my assets in financial assets."
Comments on the US economy and stocks:
"First of all, I believe that today we are talking about the global economy. The U.S. stock market has just about outperformed any other market around the world in the last 6 to 12 months. We have big trouble coming into emerging economies. The emerging economies are not performing well, There is no growth at the present time. The Chinese economy, maximum is growing at four percent per annum. We have multinationals in the S&P. Their growth and global growth came from the last four years from the recovery in the emerging world. If the emerging world does not grow, the global economy will not perform well and corporate profits, as we just saw today from Oracle, will disappoint and stocks won't be the best investment in the world... I think the market is on the high side, corporate profits are inflated and we could easily, from the recent high, May 22 at 1687 on the S&P, drop by 20% to 30%, easily."
Marc Faber prediction on where gold will be by year end:
"Well, I think we will be higher by year end but I am not worried where we are. I have said that I buy gold regularly. I just bought today at $1300 and I will buy more at $1200 and I will buy more at $1100." "I don't know, I am not a prophet, I don't know exactly where the price will be on a month by month basis, but I want to have some wealth, some of my assets in physical gold. I can see a lot of problems coming into the world including expropriation through taxation or through regulation or even through revolution and social strife."
His thoughts on where 10 year yield is going:
"I am tempted to buy a 10 year treasury at a yield of 2.5%. I think we will rebound in the treasury market. Yields will go down first, and if they go up further, it will kill the economy including the housing market."
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
"The only thing that I know is that I want to own some physical gold because I don't want all of my assets in financial assets."
Marc Faber thoughts about the markets:
"Well, right now equities, bonds and gold are very oversold. They can easily rally on the S&P. We could rally 43, 50 points, but I don't expect a new high. Just in case a new high would be achieved in the next two months or so, it would not be confirmed by the majority of shares. In other words, very few stocks would lead the advance. In terms of bonds, they are also incredibly oversold. Where the sentiment about equities is actually still rather positive and all of these super bulls still predicting the market to continue to rise into 2014, 2015. In bonds and gold, sentiment is by historical standards incredibly negative. As a contrarian, I would rather buy bonds and gold than equities."
His comments on bonds and QE tappering:
"If you say that if he means what he says, then you believe in Father Christmas. He said if the economy does not meet the expectations of the fed in one years' time, they will consider additional measures. In other words, if the economy has not fully recovered by mid-2014, more QE will be forthcoming. As I said already three years ago, we are going to go with the Fed to QE99."
Is Marc Faber worried about inflation?
"Well, I think investors have a misconception about what inflation is because it is essentially an increase in the quantity of money and credit. We have wage deflation in the world in real terms, for sure. In other words, real wages are going down and the cost of living everywhere are going up. That is why you have social unrest in North Africa, in the Middle East, in Turkey, in Brazil, and it will spread because the average person on the street hasn't participated in the huge asset inflation that has been going on in high-end properties, Mayfair properties, Fifth Avenue, Madison Avenue, the Hamptons and in equities and until recently in bonds and commodities."
Marc Faber on gold down moves:
"To that I respond there are many people out there, they never owned an ounce of gold in their lives. They were bearish about gold at $300, bearish about gold at $700, bearish about the stock market in 2009 when the S&P was at 666. Now, they are bullish about stocks and they are still bearish about gold. The commercial hedgers - these are professional miners, mining companies and people involved in gold trading. They have the lowest short exposure, since 2001 when gold was at $300. Similarly, in the silver market, the commercial hedgers, again, the professionals have the lowest short exposure since 2001. I would rather bet on the commercial miners, the commercial hedgers than on some forecaster who knows about the future of prices as little as I know. The only thing that I know is that I want to own some physical gold because I don't want all of my assets in financial assets."
Comments on the US economy and stocks:
"First of all, I believe that today we are talking about the global economy. The U.S. stock market has just about outperformed any other market around the world in the last 6 to 12 months. We have big trouble coming into emerging economies. The emerging economies are not performing well, There is no growth at the present time. The Chinese economy, maximum is growing at four percent per annum. We have multinationals in the S&P. Their growth and global growth came from the last four years from the recovery in the emerging world. If the emerging world does not grow, the global economy will not perform well and corporate profits, as we just saw today from Oracle, will disappoint and stocks won't be the best investment in the world... I think the market is on the high side, corporate profits are inflated and we could easily, from the recent high, May 22 at 1687 on the S&P, drop by 20% to 30%, easily."
Marc Faber prediction on where gold will be by year end:
"Well, I think we will be higher by year end but I am not worried where we are. I have said that I buy gold regularly. I just bought today at $1300 and I will buy more at $1200 and I will buy more at $1100." "I don't know, I am not a prophet, I don't know exactly where the price will be on a month by month basis, but I want to have some wealth, some of my assets in physical gold. I can see a lot of problems coming into the world including expropriation through taxation or through regulation or even through revolution and social strife."
His thoughts on where 10 year yield is going:
"I am tempted to buy a 10 year treasury at a yield of 2.5%. I think we will rebound in the treasury market. Yields will go down first, and if they go up further, it will kill the economy including the housing market."
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
June 13, 2013
Marc Faber's Favorite Singapore REITs
Marc Faber: That's right. I like stocks such as SIA Engineering (SIE.Singapore) and Kingsmen Creatives(KMEN.Singapore) in Singapore. As for REIT stocks, they rose 40% last year, and are up 10% to 15% this year. They won't keep rising that way, but yields of 5% and 5.5% compare favorably with those of U.S. REITs. Plus, if inflation picks up, the REITs can raise their rents. In a world of inflated asset prices, there is a competition to choose the least-ugly assets. - in Barron's
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
June 10, 2013
Marc Faber Video
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
May 28, 2013
Marc Faber Marc Faber Video - 2013 Gold Price Prediction
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
May 14, 2013
Marc Faber Video: On Sex & Nightlife in Thailand
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
April 16, 2013
Marc Faber "I love the Fact that Gold is Finally Breaking Down"; Gold vs. Apple; Patience, Gold, Japan
Marc Faber on Bloomberg TV on the Fall in Gold Prices
"I love the markets. I love the fact that gold is finally breaking down. That will offer an excellent buying opportunity. I would just like to make one comment. At the moment, a lot of people are knocking gold down. But if we look at the records, we are now down 21% from the September 2011 high. Apple is down 39% from last year's high. At the same time, the S&P is at about not even up 1% from the peak in October 2007. Over the same period of time, even after today's correction gold is up 100%. The S&P is up 2% over the March 2000 high. Gold is up 442%. So I am happy we have a sell-off that will lead to a major low. It could be at $1400, it could be today at $1300, but I think that the bull market in gold is not completed."
"$1300. Nobody knows for sure but I think the fundamentals for gold are still intact. I would like to make one additional comment. Today we have commodities breaking down including gold. At the same time we have bonds rallying very strongly. If you stand aside and you look at these two events, it would suggest that they are strongly deflationary pressures in the system. If that was the case, I wouldn't buy stocks or sovereign bonds because the stock market would be hit by disappointing profits if there was a deflationary environment."
On gold falling lower if we have a deflationary environment:
"Yes, I agree. That's why I said if the gold market collapse is saying something about deflation and at the same time we have this sharp rise in bond prices and the signals are correct that we have deflation, I wouldn't buy stocks because in a deflationary environment, corporate profits will disappoint very badly."
On whether a deflationary environment is possible right now:
"Everything is possible…In the economy of the cuckoo people that populate central banks, everything is possible. What you have is gigantic bubbles, the NASDAQ in 2000, then the housing bubble and then commodities in 2008 when oil went from $78 to $147 before plunging to $32 within sixth months. That kind of volatility comes from expansionary monetary policies from money-printing."
"All I'm saying is that I think we're going to have a major low in gold in within the next couple of weeks. Gold, as of today, you should actually buy as a trade. I think it can rebound in the next two days by $40."
On why gold will rebound $40 in the next two days:
"Because we are about in gold as oversold and we were essentially during the crash in 1987. From there we have a strong rebound. All I am saying as a trader I would probably enter the market quickly for a rebound of $20 or $40. From a longer term perspective, I would give it some time. We may go lower. I am not worried. I am happy gold is finally coming down, which will provide a very good entry point."
On whether investors should also stay in cash:
"My argument is that you should always have in this kind of high volatility environment a fair amount of cash because opportunities will always arise again and again and if you have cash you can then buy assets at a reasonable price. I think Patience is very important in this environment. The question is, how do you hold your cash? Hopefully not with a Cyprus bank.
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
April 15, 2013
Faber: Cyprus Catastrophe 'Can Happen Anywhere in the World'
The banking catastrophe in Cyprus could be repeated in the United States and elsewhere, according to Marc Faber, the editor and publisher of the Gloom Boom & Doom Report.
“It can happen anywhere in the world, in Western democracies, because you have more people that vote for a living than people that work for a living,” Faber told CNBC.
Therefore, the wealthy in the United States should “be prepared to lose 20 to 30 percent. I think you’re lucky if you don’t lose your life,” he noted.
“If you look at what happened in Cyprus … people with money, they will lose part of their wealth either through expropriation or higher taxation.”
Despite equity markets reaching all-time highs, Faber is “very cautious” about the U.S. market.
"What concerns me really is that most foreign markets have performed very badly since January — emerging markets are down 10 percent and European markets have grossly underperformed the U.S. In other words, the U.S. is the only game in town," he stated.
"Each time there was only one game in town … it ended badly. So I am very cautious about the U.S. market. We could very well first rise and then have a crash from summer onward," Faber explained.
“We have this money printing, which obviously will lead to misallocation of capital.”
He cited concern over a “narrow leadership” concentrated in consumer stocks, such as Johnson & Johnson and Procter & Gamble.
But, Faber noted, 92 percent of financial wealth is owned by 5 percent of the population.
“The majority of people don’t own meaningful stock positions and they don’t benefit from a rise in the stock market,” he said. “But they are being hurt by rising costs of living and we all know that the real income of the median household is going down for the last few years.”
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
“It can happen anywhere in the world, in Western democracies, because you have more people that vote for a living than people that work for a living,” Faber told CNBC.
Therefore, the wealthy in the United States should “be prepared to lose 20 to 30 percent. I think you’re lucky if you don’t lose your life,” he noted.
“If you look at what happened in Cyprus … people with money, they will lose part of their wealth either through expropriation or higher taxation.”
Despite equity markets reaching all-time highs, Faber is “very cautious” about the U.S. market.
"What concerns me really is that most foreign markets have performed very badly since January — emerging markets are down 10 percent and European markets have grossly underperformed the U.S. In other words, the U.S. is the only game in town," he stated.
"Each time there was only one game in town … it ended badly. So I am very cautious about the U.S. market. We could very well first rise and then have a crash from summer onward," Faber explained.
“We have this money printing, which obviously will lead to misallocation of capital.”
He cited concern over a “narrow leadership” concentrated in consumer stocks, such as Johnson & Johnson and Procter & Gamble.
But, Faber noted, 92 percent of financial wealth is owned by 5 percent of the population.
“The majority of people don’t own meaningful stock positions and they don’t benefit from a rise in the stock market,” he said. “But they are being hurt by rising costs of living and we all know that the real income of the median household is going down for the last few years.”
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
March 30, 2013
Marc Faber Video: Not Even Gold Will Save You From What Is Coming
Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.
Subscribe to:
Posts (Atom)