Friday, July 22, 2016

Faber Says Another Round of QE Ahead

'Gloom, Boom & Doom' Report Publisher Marc Faber weighed in on the impact of Brexit on the global markets and economy as well as central bank policies.

Faber raised doubts about the notion that markets, at least in the U.S., are gaining their confidence back since the U.K. vote to leave the European Union.

“Regarding the confidence, I’m not so sure because if you look at the performance of treasury bonds, they would indicate that there is a sense that the economy’s weakening and that there are problems in the financial system. Also if you look at the performance of European bank stocks, they are horrible performers,” Faber told the FOX Business Network’s Dagen McDowell.

He then predicted central banks’ reaction to Brexit globally.

“Clearly Brexit means more money printing by central banks; They will continue to intervene. And I think before the year end we’ll have some form of QE4 in the U.S.”

Faber then responded to Federal Reserve officials attaching a low probability to the risks of a potential U.S. recession in 2016.

“The Fed was fast asleep ahead of the 2007-2008 recession. So the fact that they assign a low probability to a recession doesn’t give me any comfort at all.”

Faber explained why a lack of additional quantitative easing globally could actually lead to a recession.

“I think the problem will be if there are no additional QEs around the world…is that asset prices will no longer go up and we’ve seen this already in London properties, in New York properties – and this will have a negative impact on the economy. The recession in my view is not going to come really from the economy per se, but from asset price deflation.”

- Source, Fox Business

Monday, July 18, 2016

Faber Says Own Gold, Prepare for QE4 as Easing Follows Brexit

Gold’s investment case has been strengthened by the U.K.’s vote to quit the European Union as the fallout may spur the world’s central banks to step up easing, hurting currencies and favoring bullion, according to Marc Faber, publisher of the Gloom, Boom & Doom Report.

The U.S. Federal Reserve may even embark on a fourth round of quantitative easing, or QE4, Faber said in an interview on Bloomberg Television on Wednesday, adding that he typically buys bullion every month. While he also likes gold shares, they need to correct first after recent gains, he said.

Gold has soared after the U.K.’s vote last week as investors seek a haven from financial turmoil and contemplate the possible implications, including additional steps from central bank policy makers in Europe, the U.S. and Asia. Holdings in bullion-backed exchange-traded products have swelled to the highest level since September 2013 as banks including Goldman Sachs Group Inc. have boosted their price forecasts.

‘Print More Money’

“If Brexit is used as an excuse, the central banks will print more money, QE4 in the U.S. is on the way and the depreciation in the purchasing power of currencies will continue,” Faber said in the interview from Hong Kong. “In that situation, you want to own some gold.”

Bullion for immediate delivery rose as much as 0.7 percent to $1,321.55 an ounce, and traded at $1,321.24 at 1:57 p.m. in Singapore, according to Bloomberg generic pricing. In the immediate aftermath of the vote on Friday prices surged to $1,358.54, the highest in more than two years.

Gold has advanced 25 percent this year as the European Central Bank and Bank of Japan embraced negative rates to kick start growth and the Fed pauses after its first hike since 2006 last December. The U.S. central bank undertook three rounds of quantitative easing starting in 2008 to overcome the impact of the global financial crisis

New Headwinds

Fed Governor Jerome Powell said Tuesday the vote has the potential to create new headwinds for economies, including the U.S., introducing uncertainties that may merit reassessing policy. Traders now see a greater probability the bank will cut rates in upcoming meetings than raise them.

Faber’s views add to a bullish chorus about bullion in the wake of the poll. The metal may stand at the start of a major bull market should the Brexit vote prove to be a forerunner of greater political and financial instability around the world, Evolution Mining Ltd.’s Jake Klein said on Tuesday.

Still, not every one is optimistic. Veteran investor Jim Rogers said this week that he’d rather seek haven in the dollar than gold, given that bullion had already rallied in 2016 before the referendum. Credit Suisse Group AG has said it’s neutral on gold over the next three to six months.

“Global growth has contracted, in other words, growth rates have been reduced and many countries are in recession already. That has nothing at all to do with Brexit,” Faber said. “Brexit is actually not about an end of globalization. On the contrary, it’s about people that rebel against the arrogant elite in the financial centers.”

- Source, Bloomberg

Friday, July 15, 2016

All paper currencies are doomed, Marc Faber says

All paper currencies are "doomed" thanks to central bank policies around the world, said Marc Faber, editor of the Gloom, Boom & Doom Report.

"They are going to become worthless because of money printing. In other words, the purchasing power is going to continue to diminish as it has diminished for the last hundred years," Faber, known as Dr. Doom, said in an interview with CNBC's "Power Lunch" Friday.

And the Brexit vote last week means even more money printing in the U.K., Japan and the United States, he said.

Therefore, he expects the dollar to go down against gold, silver and platinum — which he believes are going to "vastly" outperform the U.S. stock market.

"Investors should have some exposure to precious metals," he advised. He sees value in mining companies, agricultural stocks and oil servicing companies.

Overall, however, the U.S. is a "fully priced market," Faber said. That said, he wouldn't go as far as shorting the market, because he doesn't like to do so in a money-printing environment.

- Source, CNBC

Tuesday, July 12, 2016

Investors are on the Titanic but there's still a few days to travel

The global economy has been weakening and could worsen ahead, but there are still a lot of market opportunities for investors, said Marc Faber, editor of the Gloom, Boom & Doom Report.

"We're all on the Titanic, but the Titanic still has maybe a few days to travel before it collapses so we might as well enjoy the journey," Faber, also known as Dr. Doom, told CNBC's "Squawk Box."

Anticipating a downtrend, Faber said he's holding physical gold in safe-deposit boxes and buried in his garden, as well as holding gold mining shares. For "ordinary" investors, he recommended holding gold exchange traded funds (ETFs), such as the Market Vectors Gold Miners ETF, or GDX.

Faber said that every investor should hold gold, calling it his preferred currency.

But that didn't mean Faber was dissing on the rest of the stock market.

Faber said the global economy's downtrend was likely to be exacerbated by the U.K.'s vote to leave the European Union (EU), or Brexit, but he added that this wasn't necessarily bad news for the stock market.

"Brexit will give a perfect excuse to the Federal Reserve not to increase interest rates and be most likely to launch QE4," or another round of quantitative easing to purchase assets in the market," Faber said. "Then the other central banks will also join and also launch further easing measures, printing money and so the global economy could worsen and stocks actually could go up."

Wednesday, June 15, 2016

Marc Faber on investment strategy

Marc Faber, the editor of the Gloom, Boom & Doom report, discuss potential investments with Brian Sullivan.

- Source, CNBC

Sunday, June 12, 2016

Marc Faber Sees Gold & Trump's Potential

(Click Image to watch, the video cannot be uploaded)

Gold prices remain under pressure ahead of the release of Wednesday’s Federal Open Market Committee minutes. However, one famed economist, known for his usually “gloomy” economic outlook, says the U.S. central bank will not raise rates and may actually resort to more easing. “My impression is that the Fed will not increase rates any further this year – my impression is that the economy is actually weaker than the statistics would suggest,” Marc Faber.

- Source, Kitco

Thursday, June 9, 2016

Marc 'Dr. Doom' Faber is a big bull on these stocks

Marc Faber, editor of the Gloom, Boom & Doom report, is well-known for his persistently negative outlook on equities. But that doesn't mean he's bearish on every stock.

"Some depressed sectors are showing signs of major lows," Faber wrote to CNBC on Thursday. "I am still negative about stocks but I can see more money printing in the future, which will lift some sectors."

Specifically, Faber is bullish on mining stocks as well as on oil and gas names. His reasoning is that if the values of currencies become depressed, gold and other commodities could see additional demand from those hoping to use them as stores of value.

"The most attractive asset in my view is gold shares and oil and gas shares," Faber said Wednesday on CNBC's "Trading Nation." "I think they still have significant upside potential this year."

More generally, the frequently doom-predicting Faber now emphasizes balance in one's portfolio.

"You need to be diversified," he said Wednesday. "To own some real estate makes sense, to own some equities makes sense, to own some cash and bonds probably makes sense, and to own some precious metal makes sense."

However, he warns that "the market will not go up. Technically, the market isn't looking very good."

- Source, CNBC

Monday, June 6, 2016

Marc Faber: Forget the economy, the Fed is ‘market dependent’

The market was somewhat spooked by the minutes from the Federal Reserve's April meeting, which suggested that if the economy continues to improve, the central bank will raise interest rates in June. But Marc Faber has an alternative take on what the central bank is up to.

In the minutes released Wednesday, it was recorded that "Most participants judged that if incoming data were consistent with economic growth picking up in the second quarter, labor market conditions continuing to strengthen, and inflation making progress toward the Committee's 2 percent objective, then it likely would be appropriate for the Committee to increase the target range for the federal funds rate in June."

While Fed officials frequently highlight their data dependency, the minutes surprised market participants who had thought a June hike was out of the question, and the release consequently led to a dip in stocks and a rise in yields on Wednesday afternoon.

Yet Faber, the editor of the Gloom, Boom & Doom Report, questions the Fed's stated reliance on economic data. In fact, to him, gauging the market's reaction to the potential for a June hike was part of the point of the release.

The Fed "said a rate hike is on the table so they can watch the market reaction," Faber said Wednesday on CNBC's "Trading Nation."

Friday, June 3, 2016

Why Stocks Are Very Vulnerable

The three major U.S. averages were up slightly Wednesday but have climbed more than 5 percent each in the last three months. In January, Faber told CNBC that "most stocks" would drop between 20 and 40 percent, which seems "conservative."

While Faber did not give a specific prediction for where markets would go from here, he said central banks in the U.S., Europe and Japan have "manipulated" stocks. He added they may not sustain their current levels with slow economic growth in the U.S. and around the world.

Faber said the leading U.S. presidential candidates, former Secretary of State Hillary Clinton and businessman Donald Trump, add more uncertainty to markets.

- Source, CNBC

Saturday, May 21, 2016

Gold and Silver Are the Best Currencies

Marc Faber, the editor and publisher of the Gloom, Boom & Doom report, has no faith in the dollar. He says precious metals are the only true currency.

"[The U.S. dollar] is not a desirable currency," Faber told CNBC, which described him as perplexed why the world has been so "enthusiastic" about the greenback. "I think the most desirable currency will be gold, silver, platinum and palladium. I still think the mining sector has embarked on a new bull market," he said.

"Over the last 12 to 24 months, many sectors have had huge declines,” he said. "And I see here, there are some opportunities."

Faber points to the gold miner ETF GDX. After falling more than 67 percent to its low on Jan. 19 of $12.40, the ETF has rebounded up to $20.58 in the last month. Faber thinks it's going higher, CNBC reported.

Gold futures are still up 15% on the year, according to FactSet, reflecting demand for safety earlier in the year as riskier assets were roiled by fears of a recession.

Some analysts attributed gold's decline Wednesday to recent comments by Federal Reserve officials, who suggested the central bank could still raise benchmark interest rates despite keeping them steady in March.

Higher rates would boost the dollar and make gold more expensive for investors who hold other currencies, pushing the price down.

Gold isn't the only space Faber finds hidden opportunity. He points to Asia where much of the economy and the market is still struggling.

"I think that in Asia, the sentiment turned very bearish at the end of last year and especially concerning China and the Chinese economy. And as a result of that, Macau gaming companies got slaughtered," Faber said. "And now they are, in my view, at a relatively attractive level. They started to move up: [Las Vegas] Sands China, Wynn China."

Wynn's stock tumbled 80 percent to its January low of $49.95. Since then the stock has made a powerful comeback to $95, but Faber believes it could still surge higher, CNBC quoted him as saying.

"I don't think it's a bargain by any means, but I believe China despite its near-term problems that could be very substantial, will in the long run be a very rewarding investment destination."

- Source, Newsmax

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