Opportunity in Natural Gas? Marc Faber

Marc Faber Sees Opportunities in Natural Gas?

“The price of natural gas is so low at the moment, and production’s been cut back so much, that a slight rise in demand is enough to trigger a huge price spike,” Naeimi said by phone today. “While other commodities have rallied, natural gas has been left substantially behind in the energy complex.”

Speculation of a global economic recovery has driven oil prices in New York up 93 percent since Dec. 19, when futures settled at their lowest since February 2004. The price of natural gas has slumped by more than a quarter over the same period.

The number of oil and natural gas rigs operating in the U.S. has more than halved from a two-decade high of 2,031 in September as the recession eroded demand, according to data published last week by Baker Hughes Inc.

“Spot is trading at much lower levels than long-dated natural gas contracts,” said Naeimi. “That means the market is expecting prices to rise. Everyone’s storing natural gas to sell at a higher price in the forward market. You also have a push for clean energy globally, which should benefit natural gas.”

Natural gas is the most “undervalued” commodity, investor Marc Faber said in an interview with Bloomberg Television on May 27.

"Peak oil is a reality. It does not mean that prices will go up in the immediate future. There are other sources of energy like nuclear and Natural Gas. Natural Gas is the most undervalued commodity right now. "Said Marc Faber

Marc Faber known as Dr. Doom also trades currencies and commodity futures like Gold and Oil.
Source Bloomberg

U.S. Inflation to Approach Zimbabwe Level

Chen Shiyin and Bernard Lo
Bloomberg
May 28, 2009

The U.S. economy will enter “hyperinflation” approaching the levels in Zimbabwe because the Federal Reserve will be reluctant to raise interest rates, investor Marc Faber said.

Prices may increase at rates “close to” Zimbabwe’s gains, Faber said in an interview with Bloomberg Television in Hong Kong. Zimbabwe’s inflation rate reached 231 million percent in July, the last annual rate published by the statistics office.

“I am 100 percent sure that the U.S. will go into hyperinflation,” Faber said. “The problem with government debt growing so much is that when the time will come and the Fed should increase interest rates, they will be very reluctant to do so and so inflation will start to accelerate.”

Federal Reserve Bank of Philadelphia President Charles Plosser said on May 21 inflation may rise to 2.5 percent in 2011. That exceeds the central bank officials’ long-run preferred range of 1.7 percent to 2 percent and contrasts with the concerns of some officials and economists that the economic slump may provoke a broad decline in prices.

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Marc Faber and Peter Schiff on The Glenn Beck 28 May 2009

we are going to have a Zimbabwe like hyperinflation , Peter Schiff and Marc Faber the two Dr Doom agree on different degrees that we are going to have a severe hyperinflation and Bond bubble ...

Dr. Doom's prediction U.S. will suffer Zimbabwe-like hyperinflation fuel for gold bulls?

Posted: May 27, 2009, 10:33 AM by Jonathan_Chevreau ETFs, Inflation, Asset Mix, gold

Over the past year, I've occasionally mused mostly in jest that the way the United States has been printing money to combat the financial crisis seems to rival Robert Mugabe's Zimbabwe. All this by way of wondering how it is that the result of running the presses has been rampant hyperinflation in Zimbabwe, yet the U.S. so far seems to have dodged the inflation bullet.

The difference, I point out, is chiefly that the United States can get away with it and Zimbabwe can't. But now comes a warning from Mark Faber suggesting that indeed, U.S. inflation may approach Zimbabwe level. The piece, which ran on Bloomberg today, is based on an interview Faber gave in Hong Kong. He said the U.S. will enter hyperinflation because the federal reserve will be reluctant to raise interest rates.

Certainly, fed chairman Ben Bernanke has never denied he would resort to running the presses: he was famously dubbed "Helicopter Ben" for his quip that he'd rain dollar bills from the skies if necessary. On Twitter, there a couple of fake Ben Bernanke identities that follow inflation and Bernanke.

One former financial advisor and financial writer takes Faber seriously: "Faber’s got a great track record. His prognosticative abilities are second to none. Couple this with his impressive investment expertise and I’ll cast my lot with Mr. Mark." I've interviewed Faber in person myself: he's dubbed Dr. Doom because he publishes the Gloom, Boom & Doom report.
It's certainly a sensationalistic prediction given that Zimbabwe's inflation rate reached 231 MILLION per cent in July. The Post also ran the item on its web site today here, including a package of other related Zimbabwe and inflation stories.
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