What Bernanke, Marc Faber's Bathroom, and Gold All Have in Common

Marc “Dr. Doom” Faber has never been shy about his opinions concerning the global markets, especially with his Twitter account. As usual, the slight feeling of anonymity with the Internet and social media leads to brutal honesty that people may not necessarily say in a normal conversation. And so is the case with Mr. Faber’s Twitter account, as a recent tweet read “I keep in my toilet a picture of Mr. Bernanke. And every time I think about selling my gold, I look at it and I know better!” Though it seems like a comical message at first, the 140 characters or less message actually brings up a good point in the gold market today. Many seem to have their eyes fixated on the fiscal cliff and how it will impact the precious metal, and rightfully so seeing as there are just a few short weeks left before that situation comes to a head. But many have been quick to forget about other underlying factors that gold has going for it in today’s market. There is no doubt that gold will have a swift reaction to however the fiscal cliff situation pans out, but once the dust settles a few weeks or months down the line, investors will simply look for the next big “event” to make gold trades. While that is a fair strategy, many brush past events to the side, something that may not be helpful today. When Ben Bernanke put QE3 in place, he created a system that will likely weaken the US dollar and strengthen gold as time goes on. With Helicopter Ben in office until 2014, the open-ended easing program could last for the foreseeable future. Focusing on the short-term events is certainly a necessity in today’s market, but it may only be extremely relevant to traders in short-term positions. Those who are of the mindset that gold is a good buy for the long term should never lose sight of all of the factors weighing for and against the metal, despite what major headline is “threatening” the world at the time.

Marc Faber: Markets Will Drop at Least 20%

Source: Bloomberg

Marc Faber: Chinese and Japanese stock markets could see a rebound

Investment guru Marc Faber gave his opinion on the stock markets. He believes the Chinese and Japanese stock markets could see a rebound, while in the U.S. the S&P 500 is likely to see a 20 percent downward move.

"I think here we’re going to go down 20 percent from the recent top at 1,470. The technical position of the market is poor and the corporate earnings are worsening. And I believe that if the statistics were precise – which they aren’t – I think there’s hardly any growth," Faber said.

Four months ago, Faber turned his attention to European stock markets, attracted by the low valuations. Faber recommended buying European stocks at the time and for the first time in his life bought them himself.

"Greece, Italy, Spain, France, Portugal, they were four months ago at the 2009 lows or even lower," he said. "I bought them simply because the valuations were low. Since then, Greece is up 65 percent," he said.

He would no longer buy European stocks, he said. "I expect a correction but no new lows," Faber said.

Now he is focusing on Asia.

"In Asia, Thailand from the 2009 lows is up 250 percent. Other markets like the Philippines, Indonesia, Malaysia, Singapore, are up by a similar amount," he said. The Chinese benchmark index on the other hand was at 6,000 in 2007, now it is at 2,000.

"I think China and Japan could have a rebound here. If Greece could rebound by 65 percent the greatest garbage could rebound by 65 percent," Faber said.

Marc Faber: Western countries in a Colossal Mess in the next 5 to 10 years

World renown economist Marc Faber expressed his opinion that in the next 5 to 10 years the U.S. and other Western countries will be in colossal mess. The author of the Gloom, Boom and Doom report told CNBC tha the reason for that is the debt burden, which will continue to increase in the upcoming times.

"I think the regimes will try to keep the system alive as it is for as long as possible, which means there’s no "fiscal cliff," there’s a fiscal grand canyon," Faber explained.

Faber argued that the political systems in place in the Western world would allow the debt burden to continue to expand. Under such a scenario of never-ending deficits, the West would rack up huge deficits. One day, the system would break, he said.

"Eventually, you have either huge changes occurring in a peaceful fashion through reforms, or, usually, through revolutions," Marc Faber said. The U.S. is getting closer to such a revolution, he added, as is Europe.

"I think the timeframe would be within five to ten years you have a colossal mess everywhere in the Western world," Faber said. "I think the deficit in the U.S. — irrespective of who is in the White House — will stay above a trillion dollars per annum for at least as far as the eye can see."

Bureaucracies in the U.S., as well as Europe, are far too big, he said, and are a burden on the economy. And he gave his recipe for the cure:

"My medicine for the U.S. is: Reduce government by minimum 50 percent," Faber said. "The impact would be immediately an improvement in the economy."

Marc Faber contradicts Jim Rogers in Chinese equities debate

Investment legend Marc Faber and legendary Jim Rogers crossed swords with each other in a head-to-head CNBC interview over the long term value case of the Chinese equity market. They both have established their names among the greatest investors of our times, but their seem to support a different points of view on how to perceive Chinese equities' poor share price over the past couple of years.

Marc Faber explained that it is difficult to be bullish on Chinese equities because since 2007 the Shanghai stock exchange has fallen from 6,100 to 2,074 today, a fall Faber cited as the main reason for his continued bearishness.

Faber is refraining from adding exposure to equities across the board, believing markets are overdue a sharp correction.

"I just want to have a lot of cash, because I think that within the next six to nine months we can buy just about anything 20% lower than it is now," he said.

Jim Rogers sees the share price fall as a value opportunity. He has recently upped his stake in the region for the third time in his career.

"China is going to be the next great country in the world," he told CNBC. "I was violently and vehemently telling people not to buy China when it was going up in 2007. I only buy China when it collapses."

Marc Faber warns not to store gold in the USA

The third round of quantitative easing will give the Fed the opportunity to buy 40 bn dollars worth of bond every month in the future.

November is the month which marks the Hindu festival of lights and both investors and jewelers have scaled up purchases before the prices of precious metals rises any further.

The one of the very few analysts who has succeeded in predicting the current crisis – Marc Faber, however, remains bearish on gold. Faber warns how important it is to store gold but not to store in the US Federal Reserve. He has also said that Ben Bernarke is just a money printer and everything he does will lead to massive inflation and leading to Dow Jones at 20k, 50k or 10m.

As a whole, Marc Faber predicted that the Federal Reserve’s policy will destroy the world and everything will collapse.

Marc Faber: The Federal Reserve will never again implement tight monetary policies

One of the leading investors Marc Faber expressed his opinion that the Federal Reserve currently has no other alternative but to print more and more money in order to sustain USA credit addicted economy. Meanwhile, the investors around the globe are expecting for an official announcement of another round of Fed balance sheet expansion may be losing ground in the next leg up in precious metals prices—and in oil and other commodities prices.

Faber is far from optimistic about the future, since there is no clear plan from the United States to cut military and 'entitlement' programs. To add to that the growing $1.5 trillion U.S. budget deficits does not make the whole picture prettier. The Swiss money manager is concerned that the only way Washington to alter the course of runaway consumer prices is through the destruction of the U.S. dollar’s purchasing power.

Mr. Marc Faber shared his opinion that the Federal Reserve will never again implement tight monetary policies. He thinks that they will print and print and print. Faber explained that the neo-Keynesians do not acknowledge that excessive leverage and levels of debt in the financial system are the root cause of the four-year-long global recession.

According to Faber, the official position of the government and its unwillingness to address the problem of an over-leveraged banking system and excessively indebted economy was made, means that more of the same monetary drug is recommended. "They cannot afford to have a debt deflation in a credit addicted economy," Faber continues.

The Swiss guru pointed out that the easiest way for the politicians to postpone the fall of the system is to keep helping the bankers printing money. The history reveals that there are always politicians involved in the way to hyperinflation and it is not entirely an economy issue. Of course, nobody wants to be in charge when the system crashes from its own weight.

Each elected and appointed policymaker knows that the ramifications of hyperinflation include civil unrest, violence and revolution—either peaceful, or not. "I tell you, sovereign credit in the Western world, they’re all bankrupt," states Faber. "But before they officially go bankrupt and can’t pay, they’re going to print money and massively so. That should be very clear. That’s the easiest way politically to postpone the hour of truth."

If Americans do not wish to turn back to the history, they might consider some current examples that reveal to where this road is leading. Greece, Spain and Italy is not ancient history, it is something that happens here and now. And according to Faber, there’s virtually no turning back for the Fed and its complicit partners in monetary crimes, the the European Central Bank (ECB), Bank of Japan (BOJ), Bank of England (BOE) and Swiss National Bank (SNB).

Marc Fabers interview carried out by The Fiscal Times

The Fiscal Times (TFT): You’ve said we’re heading for financial “Armageddon.” Why that dire?
Jim Rogers (JR): The United States is the largest debtor nation in the history of the world. Our debts are skyrocketing every year and nobody’s doing anything about it. Every country in history that’s gotten into this situation has had a crisis or a semi-crisis, or both. In 2002 we had an economic slowdown, which was fairly serious, and then in 2007 and 2008 we had another one, which was worse because the debt was so, so, so much higher. The next time around the debt is going to be that much more catastrophic.

TFT: We are still hearing calls for another round of quantitative easing by the Fed. Bad idea?
JR: It’s an absurd idea. Printing money has never solved anyone’s problems. Maybe sometimes in the short term printing money has alleviated the situation, but anybody who has studied history or economics knows that printing money in the longer term doesn’t work. Maybe this time it’s different, but I doubt it.

TFT: What’s your assessment of the market? Are you still bullish on commodities long term?
JR: Yes. My view is if the world economy gets better, I’m going to make money in commodities because of the shortages that are developing and getting worse. And if the world economy doesn’t get better, then they’re going to print money. It’s the wrong thing to do but that’s all they know. They’re not very smart people. So they’re going to print more money, and when they [do],  historically you’ve always protected yourself – and made money – by owning real assets.

TFT: Are there some real assets that you prefer to others?
JR: On a historic basis, agriculture is still cheaper than others. But I own them all. I own more agriculture than I own of the others, but I own them all.

TFT: Have you been putting more money to work in commodities or in other areas?
JR: Not recently. I’ve been watching. I’ve got my positions. I’ve bought a few more Myanmar shares recently, but other than that I haven’t done anything.

TFT: What about China? You’re still bullish despite the concerns about how the economy there is doing – concerns that were reinforced last week with the weaker trade data that came out. Do you think those concerns about China and a potential hard landing have been overblown?
JR: I’m a little surprised anybody says anything about China. China has publicly announced for three years they’ve been trying to slow their economy down. They’ve announced almost every month or every quarter they were trying to slow things down,  so anybody who isn’t aware of this either hasn’t been paying attention or doesn’t know what they’re doing. China is slowing down, by design, properly, if you ask me. Some parts of [that] economy are going to have problems, such as property and real estate. Other parts are going to continue to do well. But anybody who deals with the West in China is certainly going to know something’s wrong. Anybody who deals with property in China is going to know something’s wrong. But part of that was by design – and proper design.

TFT: You say there are broader structural problems with our agriculture industry and that the U.S. may have a shortage of farmers. Are we going to have problems producing crops beyond the weather-related issues we’re seeing this year?
JR: Nearly every year, the world always has a problem somewhere with weather or something, since the beginning of time, and I suspect we will continue to. The problem now is it’s going to be more and more difficult to recover because of two things. One, we’ve consumed more than we’ve produced nearly every year over the last decade, so inventories are very low. But more importantly, we’re running out of farmers. The average age of farmers in America is 58. More people study public relations than study agriculture. We don’t have anybody going into agriculture. Something’s got to happen, such as much higher prices, or we’re not going to have any food at any price… We’ve got to do something to get farmers back into the field.We produce 200,000 MBAs in the U.S. every year. Some human being has to go into the field. Yeah, things are more automated, but still, somebody has got to get his hands dirty.

TFT: Will the presidential election change the investing picture at all? And what are your thoughts about Mitt Romney’s choice of Paul Ryan as his running mate?
JR: As far as I’m concerned, the election is irrelevant. One [candidate] happens to be from Boston and one from Chicago, and whoever wins, their friends are going to do well, but other than that America is not going to do well. There’s very little difference in any of these guys. None of them understands the problem. These are the guys that got us into trouble. You expect them to get us out?

TFT: You’ve given money to Ron Paul’s campaign. Would he have done a better job?
JR: I suspect he would have. He would have had the problem of dealing with a Congress that is not in sync with his views, but he certainly would have pushed us in a better direction than these guys will.

TFT: Average investors see what’s going on in the U.S. and hear about what’s happening in Europe, China and other areas in the emerging world. How should they position themselves ?
JR: Investors should be investing in and owning things they know about. If you don’t know what you’re doing or don’t have something you think is going to be a good investment, you should do nothing. The problem these days is even if you put your money in cash, what kind of cash? Some cash is better than others. But even if you don’t know any better, just put your money in U.S. dollars in the bank and wait until you find something you know a lot about. I happen to be invested in commodities and especially agriculture – and I own currencies and I’ve sold short stocks. But people – if they can’t spell commodities, they shouldn’t be listening to me. They should be doing what they know about.

Source: The Fiscal Times

Marc Faber warns about China slowing down and buys European stocks

The publisher of the famous Gloom Boom & Doom report Marc Faber is very pessimistic about China these days. He warns that the biggest Asian economy will not be able to maintain its growth rate and will slow considerably. So Mr Faber is buying European stocks.

Marc Faber is buying European stocks

One of the leading investors Marc Faber has recently focused his interest in buying European stocks. Although the dark predictions about the future of Greece and Spain, contrarian investors like Marc Faber will never miss chance like this. CEO of Marc Faber Ltd and author of the monthly Gloom, Boom & Doom Report, Swiss-born Faber serves as a director or adviser to a number of investment funds, mostly focused on emerging markets.

It is commonly known, that for the most part, Marc has been out of stocks in the world's major countries for many years – since well before the dot-com crash in 2000. Recently on Bloomberg TV, Marc Faber admitted that European stocks are relatively attractive right now. Most European markets peaked out a year ago in May 2011 and are down very substantially. They are approaching or even exceeding the lows of 2009. That gives you many shares of good-quality companies that are yielding 5% to 7%.

Marc Faber: US Treasuries is the biggest bubble ever

Marc Fiber, Swiss advisor of a number of investment funds, discussed the current bull market around U.S. Treasuries in his recent TV appearance on Bloomberg T.V. When asked if U.S. Treasuries are the biggest bubble ever, Mr. Faber did not try to decline the question and simply agreed with such assertion. He explained, that if asked about the Nasdaq in December 1999, he would have said this is the biggest bubble ever.

Despite that the Nasdaq continued to go up 30 percent until March 21 2000, and then it's been a disaster.

The gold has reach the bottom range of its cycle lows, believes Marc Faber

Marc Faber, author of the Gloom Boom & Doom Report, believes the gold market has reach the bottom range of its cycle lows. Following months of suggestions that the gold price could move down to the $1,200 level, has admitted that the gold market has hit the bottom. He added, that he can not be sure that Gold will not make a new high this year, but according to Faber the market have bottomed out and some gold mining shares have become very very inexpensive compared to the reserves they have.

Greece must exit the euro zone right away

I don't know what will happen to the euro zone. I know what should happen though.

And what should happen is that greece exits the euro zone right away and defaults on all its obligation to foreigners. If they have obligations to foreigners, it's the mistake of the bureaucrats in Brussels.

According to the polls in Greece, because they know that in the future it will be worth 70% less than a euro and that is why they don't want to leave.