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Thread: Marc Faber on gold

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    Default Marc Faber on gold

    http://www.bi-me.com/main.php?id=442...cg=4&mset=1011

    "INTERNATIONAL. Marc Faber the Swiss fund manager and Gloom Boom & Doom editor said the governments of every developed economy will eventually default on their sovereign debts, so the one thing he will never do in his life is 'sell my gold.'

    Potential defaulter include the US, the UK and Western Europe.

    Speaking to CNBC in a live interview via telephone, Faber said: "In the developed world we have huge debt to GDP, in terms of government debt to GDP and unfunded liabilities that will come due."

    "These unfunded liabilities are so huge that eventually these governments will all have to print money before they default," he added.

    Speaking at Russia's Troika Dialog Forum in Moscow last week, Faber said: "I'm convinced the US government will go bankrupt, but not tomorrow, and before they do they will print money [and] you'll get a depression with very high inflation rates."

    "If you ask me about the correction in the gold market, sure, we already corrected 10% from the peak and it could last somewhat longer.

    "But when I look at Mr.Obama, Mr.Bernanke, Mr. Tim Geithner and Mr. Larry Summers, the one thing I will never do in my life is sell my gold."

    In an interview with Bloomberg Television in Hong Kong on Thursday, Faber reiterated he doesn’t see a “huge downside risk” for gold.

    “I won’t rule out that gold will go down to US$950 or US$1,000, but I don’t expect more downside."

    “I don’t see any scenario where gold will collapse," he added.

    But this is what faber then said that really caught my attention:

    "The gold bull market will come to an end when sovereign wealth funds – sick and tired of their investments in financial stocks – will finally purchase gold," wrote Faber back in January 2008 in his Gloom, Boom & Doom report.

    Any opinion on who be the seller at the top of the gold bull market will be? And why will the sovereign wealth funds end up with the gold that will be too expensive and they won't be able to find the buyer to sell their gold to at high price? Gold will become less liquid/non-liquid at the top?
    Scratching my head on this one...

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    Default Re: Marc Faber on gold

    ^^^ the 'greater fools' will probably be individual retail investors in the US and Europe ... who will finally climb on the gold bandwagon after the US dollar and Euro have clearly started to lose 'purchasing power'.

    There is also a fair amount of speculation from sources other than Marc Faber that China sovereign gold buying now establishes a US $ 1000 floor in the gold price.

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    Default Re: Marc Faber on gold

    And at the top of the gold market, what will the smart money be buying as they sell their gold?

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    Default Re: Marc Faber on gold

    ... Farmland and Fertilizer ? Oil and Gas futures ? The latest superfluous technology stocks ? Chinese Yuan ? Automatic Weapons ?



    (snip)"Here's how these savvy Insiders are preparing: In his 2008 best-seller, "Wealth, War and Wisdom," hedge fund manager Barton Biggs, a highly respected Insider in the "Happy Conspiracy," advised rich insiders to expect the "possibility of a breakdown of the civilized infrastructure."

    His advice: Make tons of money. Buy an isolated farm in the mountains. Protect family against the barbarians: "Your safe haven must be self-sufficient and capable of growing some kind of food ... It should be well-stocked with seed, fertilizer, canned food, wine, medicine, clothes, etc. Think Swiss Family Robinson."

    How Wall Street insiders will treat Main Street in 'The Anarchy'

    And when the barbarians do come, firing "a few rounds over the approaching brigands' heads would probably be a compelling persuader that there are easier farms to pillage." Imagine a scene like Port-au-Prince after the quake. Biggs is no radical anarchist, he's an establishment Insider, a great guy. We both arrived at Morgan Stanley about the same time. Biggs remained 30 years, was Morgan's chief global strategist. Ten times Institutional Investor magazine put him on Wall Street's "All-America Research Team."

    True, he did hedge his prediction of the coming anarchy. His odds: 1 in 10. But in an early 2009 Newsweek article, "A Generation of Destruction: Throwing money at the problem and propping up greedy banks is like trying to put out a fire by pouring gasoline on it," Biggs teased us with a bleak scenario: "Great cycles of wealth creation have usually lasted about two generations, or 60 years. Inevitably, unequal riches corrupt and create envy, and they are always followed by a generation of enormous wealth destruction."

    Warning: By vastly understating the risks while his Insiders prepare for the coming anarchy, Biggs is quietly misleading and disarming the rest of America.

    The truth is Insiders in the "Happy Conspiracy" elite will follow Biggs' ultra-simple investment strategy: Make massive amounts of money fast using short-term strategies, spout lip service about the "public good." But always act in your own self-interests first, preparing for when anarchy spreads worldwide in an economic pandemic.

    How can America's 299 million 'second-class citizens' invest for anarchy?

    So what can the average Joe and Jane, the other 299 million Americans do? Warning: In anarchy, nobody knows. Period. The only possible strategy: "Think Swiss Family Robinson." Stockpile like a "Happy Conspiracy Insider."

    Many still challenge us about proven strategies like buy and hold, Modern Portfolio Theory, Lazy Portfolios. Unfortunately, they all need a real democracy driven by honest, transparent capitalism to function effectively. They can't function in anarchy.

    And Wall Street's already lapsed into a toxic pseudo-capitalism, using it to manipulate Main Street America. Eventually that mindset will force Main Street Americans to misuse the same dark "Swiss Family Robinson" tactics as the Insiders in order to survive the coming anarchy.
    What's our alternative? A new American Revolution

    But wait, wait, I hear you asking loudly: There must be an alternative to this dark descent into anarchy, to the loss of everything that made America the greatest nation in history?

    Yes there is an alternative. Out of the ashes of anarchy must come a Second American Revolution. But unfortunately nothing will happen until a great crisis awakens America ... shocks the conscience of the masses ... we are "asleep" ... only a seismic, systemic shock will trigger the necessary revolution.

    The future of our economy and indeed our nation demands another political revolution. We must take back our democracy and capitalism from a government run by Wall Street and its "Happy Conspiracy" ... their toxic self-serving power hold must be broken and, if not, a rising new conspiracy of China, India, oil-sovereignties and asset-rich nations will replace our homegrown "Happy Conspiracy" as it eventually goes down in the flames of anarchy.

    Sadly, that's the future many of us realists see ahead for America."(snip)

    ~
    Last edited by Melonie; 02-12-2010 at 12:50 PM.

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