Marc Faber: More S&P downside, commodities ‘horrible’…except gold

With the S&P 500 SPX down 2.4% after the Fed laid it on the line, it shouldn’t come as too much of a surprise to see the bears out there growling away.
Noted contrarian Marc Faber told CNBC on Thursday that he sees further downside for the S&P.

“…not because of Fed’s statements because, like always, they hedged their bets in the sense that this tapering off would not neccesarily stop. Mr Bernanke said if the economy does not improve along the lines that we expect we will provide additional support. I think the markets are worried about something else,” says the publisher of the GloomBoomDoom report.

And that something else he says, is the fact that interest rates have been rising for a year, noting that yields on 10- 10_YEAR  and 30-year 30_YEAR  Treasury notes bottomed out last July, and interest rates have been trending up since.
Emerging markets are also becoming an increasing worry for investors, with those outside of China basically flat and even Singapore, where he notes statistics can largely be trusted, not very cheery, said Faber. But China remains a major worry in this realm:

“The Chinese economy is much weaker than the official statistics suggest. At the present time, the Chinese economy is, at the very best, growing at 4% per annum. Without huge credit expansion there would be no growth at all.”

Faber has been consistently warning of a market meltdown, saying back in March that bubbles across markets were coming and there was nowhere to hide, not even gold.
While gold GCQ3  has tumbled to levels not seen in two and a half years in the wake of expectations the Fed may trim its monetary policy stimulus later this year,  (though gold rebounded some on Friday), Faber did indicate there could be some respite on the horizon.

“Technically, commodities look horrible…precious metals look bad. But tech factors would suggest we’re approaching at least an intermediate low. The commercials, which are essentially hedgers, people who produce gold and so continuously hedge, at the present time they have an extremely low short exposure, basically they’re accumulating gold.
“Whereas gold is close to $1,300 compared to say $700 in 2008, conditions in the mining industry are horrible. The exploration companies are running out of money and industry conditions are worse than they were in 2008. So I think that a lot of supply that potentially comes to the market through new exploration will simply not be there. In emerging economies sovereign funds, central banks and individuals will continue to accumulate physical gold.”

 Source: http://blogs.marketwatch.com/thetell/2013/06/21/marc-faber-more-sp-downside-commodities-horrible-except-gold/