Wednesday, April 07, 2010

Why Marc Faber Is Predicting A Large Correction Right About...Now

About a month ago, Marc Faber told Bloomberg that we could easily see a correction of 20% if the S&P topped 1150 and approached 1200.

Well, it seems like we're just about there, so we'll see how Faber's near term musings fare in the weeks ahead.

You can check out a video of Faber's Bloomberg interview here.

Some other thoughts from Faber:
  • He thinks the Euro is very oversold, and can rally to 1.40 before going lower
  • Doesn't see anything much good about the Euro, or the Dollar, for that matter
  • Debt monetization is inevitable in the long run
  • He likes precious metals and Asian currencies - says "most currencies are sick"
  • Better to be in stocks than bonds over the next few years, because he expects increasing inflation
Faber's book Tomorrow's Gold is excellent by the way - if you haven't read it, and you are a Faber fan, I'd definitely recommend you pick up a copy.

Interestingly Faber was a deflationist when he wrote the book almost 10 years ago, and has since flipped to the inflation camp, because he believes that sovereign printing presses will overwhelm broader deflationary forces.

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