Marc Faber Gold cheaper today than it was in 1999 at $252

Marc Faber CNBC Interview 08 Apr 11

Only the Federal Reserve does not acknowledge the existence of Inflation , In Gold and Silver Terms the Dow Jones over the last ten years has already lost over more than 80% of its value says Dr. Marc Faber , Gold is not in a bubble matter of fact it is cheaper today than it was in 1999 when it was at $252






Marc Faber : "....well, i think that asset markets move up and down, and they go from a rising face into a boom phase and into collapse and then people are gloomy. and there is gloom and doom around, and then the market bottom out. and then the whole process starts again. so i think as an investor you have to realize occasionally markets are overvalued, and occasionally they're undervalued. "

"well, i think in general if you have sound money, then money's a medium of exchange, unit of account, and the store of value. but if you read, say, what Janet yellin said, she's now vice chairman of the fed, that if it were possible to take interest rates into negative territory, i would be voting for that. it means that the fed will keep interest rates below the rate of cost of living increases essentially for as far as the eye can see. and in that environment, obviously cash and bonds are dangerous. they have to move into asset classes like equities, commodities, real estate, art, collectibles, anything that essentially cannot be multiplied at the same rate as paper money. that is subject to the printing presses of mr. bernanke. "

" not at all because between june, 2004, and august, 2006, the fed increased the fund rate to 5.25%. there was never monetary tightening occurring because the cost of living increases and nominal gdp was increasing at the faster rate. the absolute level of rates doesn't tell you whether there's tightening. in china they've increased interest rates several times. but with inflation running at, say, between 8% and 10% per annum and the deposit rate at 3.25%, money is losing its purchasing power if you keep it on deposit. so i think in the u.s. you will have a similar process. one day they'll increase it by a quarter percent. but what i mean, when commodity prices are going through the roof, energy prices are going up. health care cost are going up. insurance premiums are going up. everything is going up. only at the federal reserve is there no inflation. it's a bitter situation".

" ...In Gold and Silver Terms   the dow jones over the last ten years has already lost over more than 80% of its value. and yesterday, my friend frank holmes was on cnbc, and i don't know remember if it was you or somebody else, but the two interviews were kind of ridiculing him, telling him that gold was a bubble and so forth. i just came now from a conference. there were over 200 people here in Singapore. i asked the audiences, fund managers, you would imagine that they are intelligent. i asked them who of you has personally more than 5% of their assets in gold. not one person lifted their hand. not one. if it were a bubble, a lot of people would have gold. the whole world would be trading gold 24 hours a day. but i don't think it's really a bubble. i think maybe gold is cheaper today than it was in 1999 when it was at $252. "