Volatility Will Increase, US Will outperform emerging markets in 2010 Marc Faber

Volatility Will Increase, US Will Lead in 2010 : Marc Faber

Marc Faber, editor and publisher of the the Gloom, Boom & Doom Report, shares his market outlook with CNBC.
Markets are likely to be more volatile and US markets are likely to outperform emerging markets in 2010, Marc Faber, author of the Gloom, Doom and Boom Report, told CNBC Wednesday.

"I think 2009 was an extraordinary year for capital gains because both commodities and stocks became extremely oversold," Faber said in an interview.

"I think 2010 is a year when capital preservation will be more important because I expect a lot of volatility up and down," he added.

Dr. Marc Faber also known as Dr Doom is an investment advisor, investment analyst and fund manager author and publisher of the Gloom Boom & Doom Report . Dr Faber is known for his contrarian investment approach. Dr Marc Faber is associated with a variety of funds and is a member of the Board of Directors of numerous companies.
he became well known for advising his clients to get out of the stock market one week before the October 1987 crash. Dr Doom motto is "Follow the course opposite to custom and you will almost be right"

Marc Faber Gold will never fall bellow $1000/oz again

In an interview with MoneyControl Marc Faber explained in details what he thinks about the gold prices and where he sees them heading after the controversy that was raised few days ago when some thought that he was contradicting himself when in a 2 days distance he declared that gold prices may go bellow $800 and that Gold will never go bellow $100/oz today he explains himself more in details...
Marc FAber"I am not so sure there's a huge dollar carry trade. What happens is that worldwide because interest rates are at zero percent institutions as well as individuals borrow money and they go and speculate. The dollar carry trade is frequently misunderstood in the sense that there are big short positions in the dollars. But one shouldn't over estimate the short positions in dollars because the world is basically awash in the dollars."

There are too many dollars floating around from the American current account deficit that reached USD 800 billion annually and total international reserves in the hands of central banks now are USD 7.7 trillion. That is the dollar overhang and to some extent some people want to hedge their dollar exposure and then they sell dollars and buy foreign currencies and of course also precious metals including gold, silver, platinum, palladium.

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Expansionary US monetary policy Creating the next crisis Marc Faber

"So I think as far as the eye can see, monetary policies in the US will stay expansionary," Marc Faber told CNBC TV 18 last week

"Reading through the literature and through the speeches that are being given by Mr Ben Bernanke, my impression is that the short-term interest rates will stay long for a very long time. In America the fiscal deficit this year will be around US$2 trillion and I do not think they can cut the fiscal deficit next year because if they cut it, it will have a negative impact on the economy.

So I rather think that the fiscal deficit will stay at this level or in my opinion actually even increase. That will lead the Fed to keep interest rates artificially low because should they increase short-term rates meaningfully then the cost of servicing the government debt in the US will escalate substantially" Faber added Watch Video Interview bellow

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The government debt in the US will escalate substantially Marc Faber

Marc Faber on CNBC TV18 Oct 1st 2009

In an interview with CNBC TV18 Marc Faber said that he does not see any recovery in the US despite the fact that the US dollar may rally for a couple months ahead , but on the long term the situation looks grim for the US economy and dollar :
"Basically, we have had huge fiscal stimulus packages and we had quantitative easing in basically all countries around the world. So asset prices have recovered strongly after March 6 this year, with stocks rising, commodity prices rising and the dollar weakening again and each time the dollar weakens it is kind of a symptom of some inflation in the system and excess liquidity building up. What we have is large cash positions around the world and zero interest rates and also the policy by the Fed to keep the matter very low level for a very long time as was the case of 2001. With this in mind, money goes out of cash balances into something, either consumption or into some kind of assets like equities or commodities or bonds or art or real estate."


and he added :


"I don't think so. I think we have to distinguish between short-term interest rates and long-term interest rates. Long-term interest rates, the Federal Reserve does not really control them in the long run. Temporary they can somewhat control them through quantitative easing and through the purchases of 10 year bonds, 7 year bonds, 30 year bonds but what they control are the short-term interest rates in other words, the Fed fund rates. Reading through the literature and through the speeches that are being given by Mr Ben Bernanke, my impression is that the short-term interest rates will stay long for a very long time. In America the fiscal deficit this year will be around USD 2 trillion and I do not think they can cut the fiscal deficit next year because if they cut it, it will have a negative impact on the economy. So I rather think that the fiscal deficit will stay at this level or in my opinion actually even increase. That will lead the Fed to keep interest rates artificially low because should they increase short-term rates meaningfully then the cost of servicing the government debt in the US will escalate substantially. So I think as far as the eye can see, monetary policies in the US will stay expansionary."

This Crisis Just Appetizer for Total Breakdown Marc Faber on CNBC Sept 25

Marc Faber told CNBC that he thinks that the G20 is a total waste of time :
"My view is that this G20 meeting is a complete and total waste of time," he said. "Nothing will be achieved except that they will implement regulations that are even worse than the regulations that brought us all these problems." he said

speaking about the dollar and inflation / hyperinflation he said :
"If you have interest rates at zero essentially you discourage people to save and encourage them to speculate," he said. "I look at the US dollar. Whenever a currency is weak, it's weak because of some inflationary pressures."
Marc Faber also explained that he is very bullish on emerging markets which are now forming a rising block and where the cars sales have for the first time surpassed the sales in Europe and in America he is obviously talking about third world giants like China India and Brazil :
"I think that people will have to rethink the world and that they should have little money in the US and have 50 percent of their funds in emerging economies," he said.

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G20 is a Complete Waste of Time. Marc Faber is bullish on emerging markets

"My view is that this G20 meeting is a complete and total waste of time," he said. "Nothing will be achieved except that they will implement regulations that are even worse than the regulations that brought us all these problems." Marc Faber told CNBC today

The G20 is a complete and total waste of time and the new regulations will be even worse than the old ones, Marc Faber, editor & publisher of The Gloom, Boom & Doom Report told CNBC. Michael Gurka from Empower Global Funds joined the discussion.

"If you have interest rates at zero essentially you discourage people to save and encourage them to speculate," he said. "I look at the US dollar. Whenever a currency is weak, it's weak because of some inflationary pressures."
Marc Faber is very bullish on emerging markets
"I think that people will have to rethink the world and that they should have little money in the US and have 50 percent of their funds in emerging economies," he added

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The central bankers are nothing else than money printers Marc Faber

The US is the least cyclical economy agrees Marc Faber with Nouriel Roubini

"Basically what we have this bull market in assets between 2002 and the end of 2007 early 2008 and a weak dollar during that time , 2008 was the opposite , a strong dollar and all assets markets went down except for bonds and now in 2009 we bottomed out on the S&P at 666 in march and since then have rallied strongly and in emerging markets even more but the dollar was weak , and I expect now may be for the next couple of months a period of recovering dollar and a correction time in asset markets " says Marc Faber "The Us is the least cyclical economy as Professor Roubini pointed out emerging economies are essentially more cyclical than the US economy , they're like a warrant on US economy , and I think in a scenario where growth will be disappointing , I think emerging markets are kind of vulnerable they also become the favorite investment destination by momentum players , and I think we had huge increase in stock prices a lot of markets have doubled in price between march and just now a couple of days ago and so a correction is possible , but having said that I would also argue that the worse the global economy is the more stocks could go up because we have all these central bankers who are nothing else than money printers " "they created first the NASDAQ bubble and then the housing bubble and now they want to create another bubble to bail them out and that's of course not a recipe for a healthy sustainable growth"
"Usually an economic and financial crisis leads to some fundamental changes. That is the purpose of a recession, of a depression, to clean the system," said Faber
"Let the derivatives players go bankrupt and the system is clean," "The total breakdown of the system is ahead of us and it will devastate the global economy."

"My view is that the Fed and the other central bankers will leave interest rates far too low and far too long," Marc Faber added.

The US stock market is strong but the currency is weak Marc Faber

during his last interview with CNBC Dr doom Marc Faber said he sees a huge breakout from the narrow trading range soon. “I think the summer is shaping up nicely. The grave is out, we had a huge rally. We now have a narrow trading range but we will get a big breakout.” He then said that the S&P could reach 970-1020.

“I have turned kind of neutral recently because I think we are at that trading range. The big move, a huge move is coming in the dollar, bonds and in equities. But I am not yet sure clearly on what side it will be.”

“I think a big move is coming. But I would like to see really what will trigger the move.”

“The US stock market is strong but the currency is weak; this signals tightening of global liquidity.”

Marc Faber Choose REITs Over Cash and Bonds

The Governments wants you to lose money on Cash by keeping interest rates artificially too low

Marc Faber says that he owns quite a lot of REITs here in Singapore and Honk Kong , I think the dividend will be cut , but let's say compared to cash or bonds , Cash is made undesirable by the government in the sense that not only they do not pay you almost nothing for your deposits but also the fees in the banks are so high that's essentially the goal of the government to make you lose money on cash and force you to speculate that was the policy after 2001 by keeping interest rates artificially low and we know now what the result was , so the big crisis is yet to come in my opinion says Marc , but say you buy REITs here , even if they cut the dividend by 50% you will still have a higher yield than cash deposit and you have an asset and that asset in my opinion over time will appreciate , because the worse the economy becomes the more governments will print and some people will say well the output cap will prevent inflation from occurring ! you know what the output cap in Zimbabwe is 99% below potential GDP and where do you have the highest inflation ? in Zimbabwe of course ....so basically strong economies have low inflation because usually they have fiscal surpluses and there is no need for the governments to pile in on fiscal deficits and to print money , the weakest economies in the world have always had the highest inflation rates....

Marc Faber, editor & publisher of the Gloom, Boom and Doom Report prefers Singapore and Hong Kong REITs to cash and bonds. He explains why investment rationale to CNBC's Martin Soong.

Marc Faber China had an over investment Bubble

Marc Faber cautious about China's official growth figures

the Chinese markets are up 70% this year , is the Chinese stimulus working ?
Marc Faber answers by saying the Chinese government is one of the few governments in the world that knows the GDP numbers three years in advance , I will take the (official) 7.8% growth rate with a grain of salt " says Dr Doom "I think probably they are some sectors in china that are growing , but other sectors are not growing much or are still in recession like the export sector , I think growth is more likely 2% to 3% than 8% " "In the US we have a stimulus package that is not very healthy because it moves the economy to governments hands and whatever the government does it is not going to be as efficiently as the private sector , In China we also had a bubble it is an over investment bubble with over capacities and so forth and now we do not solve the problem we have created another bubble the bank lending , and the banks they lend the money out , it is impossible that they lend it out all wisely , some will go soar and so forth so I'll be a bit careful about China" concludes Marc Faber editor and publisher of the Gloom Boom and Doom report

Marc Faber Gold Price will explode

Another Crash May Be in the Works

Marc Faber says " well for me gold is not expensive for the simple reason that if you look at the quantity of money that's been created and the quantity of debt that has been created on the last 10 , 15 , 20 years and you look at the quantity of gold and how much the production of gold is annually , it is so tiny so I believe that essentially Gold one day will be much much higher or turn it around that the value of money will just sink , because if you increase the quantity of money it's purchasing power goes down and with all this discussion about deflation all I can say , i do not know how much old you are but prices in Singapore are much higher than twenty years ago , prices in Switzerland are much higher than 20 years ago prices in America everything is much higher than twenty years ago indeed the purchasing power of paper money has gone down "

The financial crisis we have just been through is really the aftershock from the dotcom bubble, says Giles Keating of Credit Suisse. He tells Marc Faber of the Gloom, Boom and Doom Report & CNBC's Martin Soong that another crash may be in the works.

Goldman Sachs huge profits in the crisis are not normal

Can Asian Stocks Make Even Bigger Gains?

Brace for a Rapid recovery or a new Collapse ? Marc Faber summed up the situation by saying for a while the markets may still run further but I think we had a crisis and nothing had been solved look how the system works the derivatives markets how banks operate the profits at Goldman Sachs , usually a major crisis like we had should clean the system , and nothing had been cleaned it's gotten worse , politically and these linkage between the politicians in America and the Federal reserves and the treasury department and Wall street and so on and so forth and the big crisis is yet to come , it will be huge , TOTAL COLLAPSE...
Giles Keating, global head of research at Credit Suisse likes Asian equities as he believes the big gains they've logged could go quite a lot further. Keating & Marc Faber of the Gloom, Boom and Doom Report share their views, with CNBC's Martin Soong.

Gold & Real Estate in Asia are Marc Faber 's Top Picks

Marc Faber recommends Health Care companies in Asia

Expect many more government stimulus packages and monetary injections, says Marc Faber, editor and publisher of the Gloom, Boom and Doom Report. He also tells CNBC's Martin Soong what sectors investors should look at in Asia.Asian markets made major lows last October November says Marc Faber and he does not think those lows will be broken , Marc Faber explains that you do not want to own a 30 years US government bond for the long run because he believes many more stimulus packages and many more monetary injections and that will lead to some inflation at some point , but what you want to own are assets , the Asian market is not yet saturated this is a huge advantage compared to Europe so a diversified portfolio in let's say Singapore will give you a dividend yield over the next ten years you will certainly make money out of these shares and these companies , in Asian market everybody can do well because the market is not saturated , In Europe if a company does well usually it is at the expense of someone else ..." "Marc Faber says he is a bog believer in Asia except japan that is doomed for decline , an investor with a global portfolio should have more exposure to Asia " Marc Faber likes besides Singapore shares Thai shares because Thailand have a big food industry and is competitive in sectors like tourism , Marc Faber top picks are Gold and Real Estate in Asia , Marc Faber likes Malaysian shares in top companies because they are stable businesses with a high dividend yield in sectors like food processing and healthcare companies Marc believes that in Asia the potential for healthcare is huge
Marc Faber ends by saying that he thinks that eventually the banking sector will recover thanks to the money given by the governments free of charge , even though the bankers dumb that they are would be able to make money thanks to the bailouts , but the next shoe to drop in the world will be commercial real estate credit cards defaults and a lot of loans wouldn't be repaid...

Marc Faber Hold Real estate Gold Silver land Hard Assets The Dollar will worthless one day

Marc Faber very bearish on the future of the dollar says that eventually it will be worthless someday between now and then we can have wide fluctuations and the other currencies may not be much better an Investor should have positions in physical gold and silver and hard assets like real estate land and some other commodities , Marc Faber said ...Marc advises his clients to have assets in real estates up to 80% of their portfolio , it will be unusual for a wealthy family to have all their investments in equities and bonds and no real estate because most of the wealthy people of this world except the new economy wealth like Google they made their money out of technology but if you look at the old wealthy families , most of them are wealthy because they had real estate , they are well to do because they did not do anything stupid with their money , they are well-to-do because they stayed tight to the real estate " "Real estate is a great way to preserve the wealth to your children in case they are not that money investment savvy" although land can be easily confiscated under certain regimes or after a war etc ...gold on the other hand is easily transportable and hidden in case of turmoils Marc Faber adds that "yes if you have your real estate spread out in for example Brazil Argentina , let's say you have real estate or equities here in Singapore and we have World War III , I think at the end of the war Singapore will still be here because it will stay relatively neutral and nobody has an interest to drop a bomb on top of Singapore simply because it's politically in the world's contest totally insignificant , so real estate here will be safe , also equities here you have world class companies in Singapore"

Marc Faber buy Intel and Singapore Shares

Marc Faber Bearish in the Long Term

dr Doom Marc Faber, editor and publisher of the Gloom, Boom and Doom Report is not a bear in the near-term, but in the long-term. He tells Martin Sorrell, CEO of WPP and CNBC's Martin Soong that he is negative on the dollar in the long run , he expects inflation wars the collapse of the dollar rise in commodities gold and silver and Asian stocks ...Marc Faber recommends buying a basket of Singapore shares and Intel shares

Marc Faber Governments Should Be Fired

Marc Faber there will be war and hyperinflation

Marc Faber, editor and publisher of the Gloom, Boom and Doom Report today from Thailand explains why he is not a bear in the near term , Marc Faber says something very unusual happened around the beginning of June , on June third the Canadian dollar picked out the Australian Dollar picked out and The Gold was at $990 on June 10th the yield on the US Bonds 10 years and 30 years picked out , and on June 11th the S&P picked out , Marc Faber thinks deficit spending is the wrong way for governments to go and that they should be fired. Martin Sorrell, CEO of WPP, disagrees. CNBC's Martin Soong joins the debate.

The dollar would be a weak currency In the long-term Said Marc Faber

Commodities are also about to top out said Marc Faber
Marc Faber was Interviewed this morning by the asian TV CNBC-TV18
he says that commodities are also about to top out , so he does not think that they are an attractive entry point anymore "es, I have had positions. Many resource stocks have more than doubled from the lows. Some have even tripled. I don�t think that it is a very attractive entry point to buy these commodities and commodity-related stocks.

Oil is up almost 100% from the lows. The demand for oil is still rising but not as much as before. There is plenty of flight. So, I just don�t think it is a very good time to buy."
and speaking about India he said that he would rather sell India than buy it " I think that India has of course good growth potential, but there are still lots of uncertainty, both political and economic. As a trader, I would rather sell India than buy it. But as a long-term investor, I would hold here in India."
and speaking about the Asian equities he said : "I have taken some money off the table. In Asia, we have lots of stock markets and lots of stocks that have reasonable valuation. I wouldn�t say very cheap, but reasonable valuation. If you have a long-term time horizon and have cash flow whereby you can buy more shares if they should go down, then I would say hold them. But as a trader, I think as of today I would rather sell than buy." he also mentioned that no paper money and at the top of the list the US dollar is desirable at this point :"In the long-term, the dollar would be a weak currency. But we have a lot of volatility and can go either way. No paper currency is very desirable. That is the problem." speaking about global markets and the high risk at entering equities at this time he said the gravy is out of the market and added :"I would say that the entry point for people who want to buy equities around the world is a high risk entry point because the global economy has bottomed out. There is little potential to grow very strongly. So, there will be disappointments in terms of earnings in the second half of 2009. The gravy is a bit out of markets. India was below 8,000 on the Sensex and has gone up almost 100%. I don�t think it is a very good time to make an entry into the markets except for traders"