Marc Faber`s Investment and Trading Ideas - A Tracking Blog About Dr. Marc Faber , Daily Tracking of Dr. Marc Faber Investment Strategy , Market analysis & Outlook and Media appearances
"It is a fallacy to believe that easy money and the purchase of treasuries will boost economic activity in the US," Marc Faber told Bloomberg in a phone interview from Thailand. "Money will flow into equities at least over the next couple of weeks, and into commodities," Faber said.
"Over the last two years we eased massively in the US and where did the growth take place? In Asia". "So when we talk about job creation, do you think that Intel or a small businessman will hire more people in the US because of further monetary printing?" he asked.
"No! they will build factories in Asia and hire people in Asia and all the monetary policies in the US create mis-allocation of capital and unintended consequences," Faber explained.
"It is a fallacy to believe that easy money and the purchase of treasuries will boost economic activity in the US," Faber told Bloomberg in a phone interview from Thailand. "Money will flow into equities at least over the next couple of weeks, and into commodities," Faber added
"Over the last two years we eased massively in the US and where did the growth take place? In Asia". "So when we talk about job creation, do you think that Intel or a small businessman will hire more people in the US because of further monetary printing?" "No! they will build factories in Asia and hire people in Asia and all the monetary policies in the US create mis-allocation of capital and unintended consequences," Faber added
"In my view over the next 10 years, Treasuries will be a disaster for investors,"
he said.
Sept. 3 (Bloomberg) -- Harvard University historian Niall Ferguson talks about the outlook for the U.S. and global economy. The August payrolls report may show the U.S. economy lost 105,000 jobs, the third straight monthly decline, according to the median forecast of 81 economists surveyed by Bloomberg News. Ferguson speaks in Cernobbio, Italy, with Francine Lacqua on Bloomberg Television's "Global Connection."
In a phone interview from Thailand Marc Faber told Bloomberg that : "It is a fallacy to believe that easy money and the purchase of treasuries will boost economic activity in the US,"
"Money will flow into equities at least over the next couple of weeks, and into commodities," Faber added.
"Over the last two years we eased massively in the US and where did the growth take place? In Asia".
"So when we talk about job creation, do you think that Intel or a small businessman will hire more people in the US because of further monetary printing?" he asked.
"No! they will build factories in Asia and hire people in Asia and all the monetary policies in the US create mis-allocation of capital and unintended consequences," Faber explained.
Quotation from Marc Faber's Monthly Market Report: "A break out above $20 could lead to a powerful upside move " In the very short term silver could have more upside (if it breaks $20) but Marc Faber likes gold better because it is more of a monetary metal. Investors need to have a large amount of gold in their portfolio for proper diversification.
"It is a fallacy to believe that easy money and the purchase of treasuries will boost economic activity in the US," Faber told Bloomberg in a phone interview from Thailand.
"Money will flow into equities at least over the next couple of weeks, and into commodities," Faber said.
"Over the last two years we eased massively in the US and where did the growth take place? In Asia".
"So when we talk about job creation, do you think that Intel or a small businessman will hire more people in the US because of further monetary printing?" "No! they will build factories in Asia and hire people in Asia and all the monetary policies in the US create mis-allocation of capital and unintended consequences," Faber added
"In my view over the next 10 years, Treasuries will be a disaster for investors,"
Marc Faber believes the greatest risk to global economy is the impending inflation that will occur due to easy Central Bank policy and money printing . Faber says Friday’s “key reversal day” was a sign that markets will perceive further government intervention as inflationary and will result in higher prices for commodities, equities and gold:
Marc Faber : as the economy does not recover much the central banks around the world will print money and nobody really wants to have a strong currency , what is more important to recognize is the impact on asset market ....I think last friday was an interesting day , first of all we had over the last ten days a lot of negative news and front page articles about that the market strategist expect the S&P to drop and so forth and that government bonds will continue to rally and on Friday we had a key reversal day where stocks close up strongly on the day after having been down in the morning and when bonds tumble , first to understand the market in my opinion will perceive easy move by central banks around the world as being inflationary ...."
This transcript was done manually and is far from being accurate.... Marc Faber talks via telephone about the federal reserve money printing
Marc Faber : as the economy does not recover much the central banks around the world will print money and nobody really wants to have a strong currency , what is more important to recognize is the impact on asset market ....I think last friday was an interesting day , first of all we had over the last ten days a lot of negative news and front page articles about that the market strategist expect the S&P to drop and so forth and that government bonds will continue to rally and on Friday we had a key reversal day where stocks close up strongly on the day after having been down in the morning and when bonds tumble , first to understand the market in my opinion will perceive easy move by central banks around the world as being inflationary ...." This transcript was done manually and is far from being accurate.... Marc Faber talks via telephone about the federal reserve money printing
In sum, the current policy approaches here and abroad are unlikely to deliver a durable and robust U.S. recovery and, critically, create sufficient growth in jobs. Yet the main debate in Washington is whether to do more of the same — namely, another fiscal stimulus and another round of quantitative easing by the Federal Reserve. This clearly conflicts with evidence that a broader and more holistic response is needed. read the full article >>>
Marc Faber : “I think there isn’t much upside potential in Treasuries unless it’s for the short term. Even the short term is uncertain. But if I look 10 years ahead, where do I want to have my money? Certainly not in U.S. Treasuries.” "In 1999-2000, foreigners also wanted to buy the Nasdaq, and what happened after that was a massive collapse," Faber said. "So I don't see foreign buying as a very intelligent leading indicator." Marc Faber explained that he is 'not interested in buying an asset class that has been in a bull market for 19 years,' and that he would rather place his investments in farmland, agricultural commodities and of course gold.
Marc Faber : Even if the global equity markets including India continue to rebound over the next couple of weeks, I do not think we will be making new highs. It's quite possible that for the current year we have already seen the high made recently. I would be cautious about buying equity including in India. The upside is limited from these levels; the Sensex may make marginal new highs at around 18,000-19,000, but the risk has increased and the days of big moves are over. I think markets will correct. via www.business-standard.com
Aug. 26 (Bloomberg) -- Mark Zandi, chief economist at Moody's Analytics Inc., talks with Bloomberg's Margaret Brennan about the outlook for the U.S. economy and possibility for another recession. (This report is an excerpt of the full interview. Source: Bloomberg)
While some are worried about the risks of inflation, others fear deflation could be a threat. David Wyss, global chief economist at Standard & Poor's weighs in, with guest host Michael Yoshikami of YCMNET Advisors and CNBC's Martin Soong.
Marc Faber : The most common point about every crisis is that in that period there was excessive debt growth, excessive credit growth, excessive leverage and excessive speculations that came about because of the excess credit growth. But the Federal Reserve does not seem to understand that. That is the most common.
The other point I would like to mention is that during such crisis, governments should actually do nothing and let the market adjust from the downside. This is because as prices decline and drop, the affordability improves again and at some point buyers come in and as a result the system is cleaned.
However, if governments intervene with fiscal and monetary measures as the US has done, it sows the seeds for the next crisis. The crises in the post 1980s period such as Tequila, 1994, LTCM, 1998, Nasdaq bubble 2000 are all indicators of this trend. The measures led to formation of a bubble which then caused bubbles in other sectors of the economy. Therefore in my view the interventions which always happen nowadays in the Western democracies are actually not desirable.
source smartinvestor.in
Marc Faber, the publisher of Gloom, Boom & Doom Report, and Peter Schiff, investment strategist at Euro Pacific Capital, discuss US Treasuries with CNBC. “The bond market is the mother of all bubbles right now,” Peter Schiff says. “This decade is going to be the worst decade for bonds in US history.” If you want own Treasuries, Schiff suggests owning them in Switzerland or another country where the government isn’t as reckless as in the US. Marc Faber also advised to avoid US Treasuries he told CNBC recently : "If you look at the different investment alternatives Equities, bonds, real estate, commodities and precious metals ... I think that equities should be represented in a portfolio, in particular, if you are very bearish about the world long-term, you probably be better off in Equities than in bonds. Somebody said before that markets are now highly correlated and that’s true to some extent but not true from other perspective. Say 2008 everything went down and the US dollar rallied and the US government bonds rallied and more recently it’s been when you have a strong day in the stock market bonds go down and so forth. So not everything is correlated and the same applies to agricultural commodities." "I think eventually inflation will accelerate," he said. "Whenever food prices go up, and grains have been very strong recently, with the sum delay, you get inflationary pressures."
10-year treasury yields fell to 2.570%, the weakest level since March 2009. While, the 30-year bond's yield reached 2.719%, the lowest level in 16 months.
Marc Faber cited a weakening U.S. dollar as a second reason to decrease holdings in the US debt.
"(The) U.S. dollar will weaken, that's the policy of the U.S. government to weaken the dollar in order to cushion the downturn in the American economy."
Peter schiff : I am sure I can speak for Mister Marc Faber as well I have met him several times and we agree on this , I think The Bond Market is the mother of all bubbles right now when it burst the loses will dwarf the losses of the combined losses of the stock market bubble and the real estate bubble , no the problem is there is no way for the government to pay this money back the only way they can do that will be a tax increase which is just horrendous and can never be accomplished , or the government gonna have to tell people on social security or medicare that they are not gonna get their checks because the government needs it to pay interests on the debt , and it is not only paying the interest , what i am afraid is that when people realize that we cannot pay this money back we're going to be able to roll all these short term debts so it's not just paying the interest , we gonna have start retiring the principal and that just impossible so it's going to be massive inflation ...."...."this decade is going to be the worst decade for bonds in history , bonds holders are going to be wiped out..."
Marc Faber :"India's long term economic growth should get supported by its huge and growing population. But in the case of China, after it's really incredible economic growth over the last 25 years, the country will slow down. For China, 10 per cent economic growth rate is not sustainable in the long run. India has been built up on much lower level of economic development and has the large growth potential. So far in India, infrastructure has not been put in place, I mean the country's infrastructure has improved but still needs to go a long way. And unlike China, the consumer markets in India are not saturated. For instance in China everybody already has mobile phones and refrigerators. But in India, markets are still not saturated therefore the growth potential is high probably for the next ten to fifteen years." via smartinvestor.in
Marc Faber the publisher of the Gloom, Boom & Doom report, said at a forum in Seoul on last June that cash and bonds will be “very dangerous” in the next 10 years as governments increase money supply to cover fiscal deficits “There’s no other way out but to print money,” . “In the long run, all paper money will go exactly to its intrinsic value, which is zero.” Marc Faber as usual advised investors to protect themselves with assets such as gold and silver. via www.economictimes.indiatimes.com
Marc Faber : "if the Robert Prechter's scenario of the Dow Jones below 1000 comes about which I do not believe but just in case it comes about then Gold may be at $5000 may be it would have gone up who knows , I would rather imagine that in a huge debt contraction that everything will be down then something will be down to zero like paper cash in US dollars , the government bonds will be worthless shares will have some value and gold will have some value "
Some economists have been saying that the US could be headed for a deflationary period just like Japan's "lost decade." Business Insider Gregory White calls for a structural re-think on how the US is spending money. He explains how defense spending isn't putting people to work and cuts need to be made.
Marc Faber : "Governments create problems , Governments are not there to solve problems , they are there to create problems and to take more and more power and freedom from individuals ..."I think in the US the stimulus spending will continue , and in my view the fiscal deficit that's say on an annual basis we are running at 1.5 trillion dollars in the last twelve months , in my view they'll be going up over time to around 2 trillion dollars annually and as far as the eye can see we are never going to have again deficit of less than a trillion dollars a year " "Te government policies are a constrain on the economic growth they are not stimulating economic growth quite on the contrary" "we have a Credit bubble in China and when it will burst we will have some negative consequences" "the big issue in Asia are more of political nature , the tensions in the world are rising between the united States and China , because obviously it should be clear to anyone that China is of course the largest trading partner of North Korea and the great supporter of the North Koreans and this does not please the other Asian nations very much nor the US , so I think we are going into a more difficult environment where other issues than just US fiscal and monetary policies will determine the movement of asset market ""something that the Chinese will not do (in the future) is to continue to accumulate at the same rate they did in the past US treasuries , that won't happen , but whether they sell it right away or reduce the position , question of course also for them is where do you invest I, i think eventually the Chinese will build up their gold reserves and of course strategic reserves like copper or oil because that is in period of conflict would be very difficult to procure for China""so far i have been to some extent surprised that the Chinese were slow to essentially accumulate Gold because we told them already 8 years ago that they should actually increase their gold holdings which they did not do , but i think slowly especially if gold came down to a level below where the Indian central bank , the Reserve bank of India bought its gold because the Chinese they will perceive it as a loss of face if they pay the higher price than the Indians , so if the price drops below around $1050 I think the Chinese will come in""Basically I am optimistic that over time the price of gold will go up in paper currency term , I could also argue that the price of gold stays the same it is just the paper money depreciates against the price of gold , well as ten years ago you had to pay $250 to buy an ounce of gold now you have to pay close to $1200 , so there is a loss of purchasing power of money , a symptom of inflation , I think that over time paper money will lose even more value and so that gold is a store of value , but can it fluctuate , of course we live in a very volatile world , I just want to tell people who are interested in Gold , it is possible that the price of gold drops to $950 dollars if the Robert Prechter's scenario of the Dow Jones below 1000 comes about which I do not believe but just in case it comes about then Gold may be at $5000 may be it would have gone up who knows , I would rather imagine that in a huge debt contraction that everything will be down then something will be down to zero like paper cash in US dollars , the government bonds will be worthless shares will have some value and gold will have some value " "it's very clear that the richest people are not the ones that own government bonds in the long run , nor the ones that own cash but people that own real estate or paintings art or they own equities or they own their own businesses and so forth or mines , mining wells or oil wells and so forth..."
Dr. Marc Faber and Dr. Ron Paul will be keynote speakers at the upcoming Kitco Metals eConference September 12-13, 2010, an online, two-day event showcasing all aspects of the metals industry, with a primary focus on precious metals. A not-to-be missed event .Investment and networking opportunities in metals exploration, mining, manufacturing, processing and end-use applications will be presented and discussed live and in real time you will be able to communicate with the presenters through webcam, text, or email. The eConference is free with Pre- Registration at www.kitcoeconf.com.
David Tice, chief portfolio strategist for bear markets at Federated Investors Inc, talks about the outlook for the U.S. economy. Growth in the U.S. slowed to a 2.4 percent annual rate in the second quarter, less than forecast, reflecting a larger trade deficit and an easing in consumer spending.
Dr. Marc Faber who is director of the mining company Ivanhoe Mines which is operating in Mongolia is very optimistic about frontier markets such the Mongolian market , Mongolia is seeing very strong growth, and could be the "Saudi Arabia of Asia", with 2 million people, massive area, and a tremendous amount of resources , he told CNBC recently , Ivanhoe Mines has three risks: Mongolian risks, commodity collapse risks, and its relationship with Rio Tinto . Frontier markets offer a lot of potential now that many emerging markets are becoming developed , Marc Faber explained. Dr. Marc Faber is associated with a variety of funds including the Iconoclastic International Fund, The Baring Chrysalis Fund, The Overlook Partners' Fund, The Income Partners Global Strategy Fund, The India Capital Fund, The Matterhorn India Fund, The Magna Europa Fund plc, The China Mantou Fund and Sofaer Capital Inc.
Mongolia has the potential to be the Saudi Arabia of Asia, says Marc Faber, editor & publisher of The Gloom, Boom & Doom Report. He speaks to CNBC's Karen Tso & Bernard Lo about the vast opportunities in the resource rich nation
Marc Faber, editor & publisher of The Gloom, Boom & Doom Report, says the rise of Asia's middle class will push up demand and add to inflation in the region. He tells CNBC's Bernard Lo & Karen Tso that price levels will continue to rise, particularly in Singapore & Hong Kong
Source: CNBC.com
Mohamed El-Erian :"The basic premise is that we are in the midst of a major national and global realignment. The main catalyst was the financial crisis of 2008, but the underlying factors have been there for a while. The question is: What does the world look like post-realignment? The world is on a bumpy journey to a new destination and the New Normal."
Mohamed El-Erian in an interview with USA TODAY Money reporter Adam Shell on 15 Aug 2010 full interview >>>>
Mohamed A. El-Erian, chief executive officer at Pimco Pacific Investment Management Co., said last week the possibility of deflation and a recession in the U.S. is 25 percent.El-Erian helps run the world's biggest bond fund with more than $1 trillion in assets under management.
"Structural problems need structural solutions" “Forget about being hostage to mindsets that are very cyclical and look broader, because there are some major structural changes -- there’s some major realignment both at the national level and at the global level,” Mohamed El-Erian Told Bloomberg in a radio interview on Aug. 13, 2010 “We should not over-depend on the Fed,” he added. “The Fed does not have enough instruments for what we’re looking at. You need other agencies to get involved. We’re not getting any structural solutions.”
Aug. 13 (Bloomberg) -- Mohammed El-Erian, chief executive officer and co-chief investment officer at Pacific Investment Management Co., discusses Federal Reserve monetary policy. El-Erian, speaking with Tom Keene and Ken Prewitt on Bloomberg Radio's "Bloomberg Surveillance," also discusses deflation and the outlook for the U.S. economy. (This report is an excerpt of the full interview. Source: Bloomberg)
Marc Faber : The experiment of the central banks and the fiscal packages that have been inactive by western governments will bitterly fail , but it may first work for a while in the sens that if you have cracks in a building and you put white paint on it it look better for a while . The problem will be that interest payments on the government debt will go up dramatically in the US , so you could end up with essentially a structure where fifty percent of tax revenues will eventually be used just to pay the interest on the government debt at that time the system breaks down than you have to monetize than you go to hyperinflation , hyperinflation usually is bad for the average household , the average household does not participate its real income goes down and then the end is that in order to distract the people from the problems you go to war...you may ask where is the enemy , well for sure the Americans will find someone somewhere , that's for sure , they can invent somebody
Slovenian philosopher Slavoj Zizek, aka The Elvis of cultural theory, is given the floor to show of his polemic style and whirlwind-like performance. The Giant of Ljubljana is bombarded with clips of popular media images and quotes by modern-day thinkers revolving around four major issues: the economical crisis, environment, Afghanistan and the end of democracy. Zizek grabs the opportunity to ruthlessly criticize modern capitalism and to give his view on our common future.
We communists are back! is the closing remark of Slavoj Zižeks provocative performance. Our current capitalist system, that everyone believed would be smoothly spread around the globe, is untenable. We find ourselves on the brink of big problems that call for big solutions. Whatever is left of the left, has been hedged in by western liberal democracy and seems to lack the energy to come up with radical solutions. Not Zižek.
A man whose bad-news predictions are most often on the money, Marc Faber's comments draw the attention of smart financial analysts. During a recent appearance in Abu Dhabi, the pony-tailed guru enthralled investors with his advice on how to survive the volatile world. Brad Reagan reports
In the white marble lobby outside the Al Jaheli theatre at the Armed Forces Officers Club and Hotel in Abu Dhabi, famed investor Marc Faber sits smoking quietly by himself.
The 60 or so financial analysts who are here for Mr Faber’s talk mill about the room, trading business cards and noshing on pastries, either unaware that the man sitting on a love seat in the middle of the room is the main attraction, or are too intimidated to approach him. full article >>>
Dr. Marc Faber in a lecture on asset allocation & tips on gold in Abu Dhabi explained that extreme deflation scenarios are extremely unlikely under the Bernanke Fed , and that he prefers Gold and resource company equities over Cash and US treasuries , he pointed out that with the U.S. so deep in debt the Fed thinks it cannot allow asset prices to drop below a certain point because that would devastate the balance sheets of the banks with debt deflation...
Aug. 11 (Bloomberg) -- Robert Prechter, founder and chief executive officer of Elliot Wave International, talks with Bloomberg's Pimm Fox about the outlook for the U.S. stock market and dollar. He speaks with Pimm Fox on Bloomberg Television's "Taking Stock." (Source: Bloomberg)
Gary Shilling : i think we are heading toward a chronic deflation simply because we are in a world where supply of almost everything is exceeding the demand " the demand is weak , the supply is big also thanks to the new technologies and the globalization says Shilling , shilling recommends bonds over stocks
In an interview WITH CNBC this morning Mohamed El-Erian CEO and and co-CIO of Pimco discussed the dangers of deflation and the remaining options for the Fed and the government.He said that the central bank can only do so much to foster growth and avoid deflation.“Fed policy is not enough. You need to do more than that to get off that road,” eL-eRIAN said.“The country is facing structural issues and it needs structural solutions,” he added. “Just focusing on the Fed is like sending in a wide receiver to play quarterback. Yes, the wide receiver is a good athlete. But he’s not a quarterback and we need to focus on structural issues.”
Investment guru and publisher of The GBD report, Marc Faber, recently wrote in his newsletter, "The Gloom, Boom & Doom Report,"
"Prechter is right when he says that when manias come to an end, prices tend to retreat to where the mania started,” “So from this point of view, a Dow Jones at 1,000 should not be excluded." A Dow 1,000 will be positive for one industry which is the Printing industry Marc Faber says. “Does anyone really think that the money printing presses won't run 24 hours a day?” ... if the Dow falls below 1,000, "Buy a self-sustainable farm in the middle of nowhere 'surrounded by high voltage fences and barbed wire and equipped with booby traps and an arsenal of machine guns, hand grenades and armed vehicles guarded by vicious Dobermans" Marc Faber says
Faber does not rule out the eventuality of a world scale devastating war “The next war will be a dirty war,” "What are you going to do when your mobile phone gets shut down or the internet stops working or the city water supplies get poisoned?” Marc Faber told fund managers in a keynote speech at CLSA’s annual investment forum in Tokyo early this year ,
Nassim Taleb, the author of The best seller "The Black Swan," is quoted as saying:"Every single human being should bet that U.S. Treasury bonds will decline."
Full article : www.arabianmoney.net If Marc Faber had to choose one asset class for the next 10 years it woud be gold. Cash and US treasuries would be be his least preferred decennial investment. US equities would be a reasonable choice for wealth protection, though not necessarily grow much when adjusted for inflation. This was the broad message that the author of The Gloom, Boom and Doom Report delivered to a CPA Institute meeting last night in Abu Dhabi, home of the world’s biggest sovereign wealth fund the Abu Dhabi Investment Authority. No deflationary bust He began by explaining why extreme deflation scenarios are extremely unlikely under the Bernanke Fed, comparing the Fed chairman’s commitment to an anti-deflation strategy to Hitler’s Mein Kampf, a book that also clearly stated a policy program in advance but was not widely believed until it was too late.
Full interview www.sqstudy.org EL-ERIAN: You know, Tom, all this speaks to what Ben Bernanke coined last week as the unusually uncertain outlook. Whether you look at the data, which is pointing in all sorts of directions, whether you look at the earnings, what we’re getting right now is very, very noisy picture. And it points to an uncertain outlook. Now, there’s two ways to think about this. One is, as you mentioned, certain data of backward looking, others are forward looking. The other thing – way to think about it is the reality that during regime shifts, data gets very noisy because you’re shifting from one regime to another and our inclination is the latter. Our inclination is to think of this as natural for a regime shift and we’re moving from a regime of high growth, leveraging, debt and credit entitlement to a more delivered, slower-growing, higher unemployment world.
“Investors should’ve listened to me already six months ago, when I wrote that the Fed will continue to monetize, and this is my view , they will never let up ? … they will print and print and print, until the final crisis wipes out the entire system,” Marc Faber
“I think that massive quantitative easing will come between say 870 to 950 on the S&P and my inclination is to believe that the July first low at 1010 will actually hold , and that the worst the economy becomes the more they’ll print money and the more equities can go up,” Marc Faber.
Dr Marc Faber was born in Zurich, Switzerland. He went to school in Geneva and Zurich and finished high school with the Matura. He studied Economics at the University of Zurich and, at the age of 24, obtained a PhD in Economics magna cum laude. Between 1970 and 1978, Dr Faber worked for White Weld & Company Limited in New York, Zurich and Hong Kong. Since 1973, he has lived in Hong Kong. From 1978 to February 1990, he was the Managing Director of Drexel Burnham Lambert (HK) Ltd. In June 1990, he set up his own business, which acts as an investment advisor and fund manager.
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