Tuesday, April 30, 2013

Dr Marc Faber on South East Asian economies

South East Asian countries such as Vietnam, Cambodia, Laos, Myanmar and of course Thailand are opening up now. I think with the trade links and transportation links that are being expanded regardless of what happens in the world, can grow. Provided there is geopolitical stability in Asia which is a big question mark. 

Friday, April 26, 2013

differences between Consumer goods inflation and Asset Price inflation

Inflation is a very interesting phenomenon, because if you increase the quantity of money, prices will go up - sometimes for wages and sometimes the symptoms of inflation come up in consumer prices and sometimes in commodity prices or real estate prices. And so we distinguish between consumer goods inflation and asset price inflation.

Thursday, April 25, 2013

Higher consumer inflation than government statistics

Today we have higher consumer price inflation than what governments admit - but we have very high asset inflation, “and every inflation comes to an end and I am of the view that some asset prices will probably come down quite a lot, if not right now, then in 2013 or sometime in 2014.

With all the money printing I would feel uncomfortable not to own any asset.”

Extended volatility and money printing

Money for nothing - zero interest rates – leads to excessive speculation and volatilities in the market place.

Marc Faber is a famous contrarian investor and the publisher of the Gloom Boom & Doom Report newsletter.

Wednesday, April 24, 2013

Even the worst asset has a good price and can double

The worst asset has a price at which a purchase is advisable - it can go up. I always say if Greece can double in price, any garbage in the world can double in price.

A while ago the best asset to own was the most widely held hedge fund stock - Apple and it tanked 37 per cent. Now it can rebound but I’m saying it doesn’t matter what you buy, it’s the price at which you buy something that matters.

Monday, April 22, 2013

Rich get richer thru money printing

Printing money is the way global governments will evade debt crises, such as the one that affected Europe. That would forestall the crisis rather than solve it, keeping prices elevated for assets like stocks, real estate in some areas and precious metal.

Loose monetary policies, including low interest rates, intended as a short-term fix, can have unintended consequences later. Some people will benefit from money printing that deflates the purchasing power of currency, but the middle and lower income classes are being hurt.

Friday, April 19, 2013

Anything is possible including deflation

Everything is possible including deflation right now. We have gigantic bubbles, Nasdaq bubble in the 1990's, commodities in 2008, these kinds of volatility comes from expansionary monetary measures.

Despite all the deflationary pressures, I think we are going to have a major low in Gold within the next couple weeks.

Thursday, April 18, 2013

Deflationary pressures in the markets

Today we have commodities breaking down including Gold. At the same time we have bonds rallying very strongly.

If you stand aside and look at these two events, you will see they are deflationary pressures in the system. If that was the case[deflation], I wouldn't buy stocks, or sovereign bonds. The stock markets would be hit by disappointing profits if there was a deflationary environment.

Wednesday, April 17, 2013

We could see a major low in Gold soon

Im very happy gold we have finally a sell off that will lead to a major low. It could be 1400, 1300 or today. But I think the bull market in gold is not complete. I think the fundamentals of Gold are intact.

If we look at the records, Gold is now down 21% from the September 2011 highs. Apple is down 31% from last years highs. The S&P is up not even 1% from the peak in 2007. Over the same period of time, including the current correction Gold is up over 100%.

Tuesday, April 16, 2013

Faber to advise Canada firm Sprott

Toronto-based investment firm Sprott Asset Management has launched its first multimanager fund for institutional investors, drawing on advice from the renowned investor Marc Faber.

The portfolio managers will choose securities based on recommendations from a macro committee led by Sprott, Marc Faber, the publisher of the Gloom, Boom & Doom report, and Rick Rule, chairman of Sprott U.S. Holdings. They will also seek recommendations from a five-person group in charge of asset allocation, Wilson said.

Currently the firm is substantially more cautious on equity markets than six months ago.

Large bank depositors are at risk

The mentality before the 2007 crisis and after that the tax payers bailed out the system but now the asset holders have to contribute to the bailout. As we have seen in the case of Cyprus the large depositors are penalized more than small depositors. 

Monday, April 15, 2013

I love the markets and gold sell off

On Gold and the current sell off:

I love the markets and the fact that Gold is finally breaking down because that will offer an excellent buying opportunity.

Marc Faber is a famous contrarian investor and the publisher of the Gloom Boom & Doom Report newsletter.

Hold money in Singpore Dollars in a Singaporean Bank

If you have all your money in the bank eventually you may lose up to 40, 50 percent  or even 60 depending on the quality of the Bank. If you hold your money in a Singapore bank in Singapore dollars, I think Singapore dollar deposit may be safe. But if you hold US dollar in a Singapore Bank they place it in a Intermarket rate and that deposit may not be safe.

Friday, April 12, 2013

Wealth Redistribution

One day the treasury may decide to withhold taxes on interest payments to foreigners. One day they may print that much money the treasury market collapses.

The well to do people that benefited thru money printing and easy monetary policies from the early 1980's will have to give back some of their money either thru taxation, or revolution or expropriation.

Thursday, April 11, 2013

Dangers ahead of a deflationary bubble

The next crisis could lead to a deflationary bubble and a bust in governments. We may have a total collapse in confidence in the system and at the same time have an increase in International tension.

Wednesday, April 10, 2013

China and North Korea conspiracy

Dont believe the North Koreans are acting on their own. Its all a test to see the resolution by the US, Japanese and the foreign powers. The Chinese are watching as they will do the same in a few years.

North Korea can hardly produce bicycles. How can they produce nuclear weapons on their own. The Chinese are using North Korea.

Tuesday, April 9, 2013

When money is printed it doesnt flow equally into the market.

Dangers of money printing, the next crisis could be severe enough that one would not even be able to hide in Gold.

Markets could continue higher but watch for crash

Near term the market is overbought, we could make new highs in the S&P500 with very few stocks making new highs.

If we go higher the probability of a stock market crash goes higher sometime in the second half of this year so I dont think its a very good time to buy stocks.

Monday, April 8, 2013

Gloom Boom Doom: April 2013 Monthly Market Commentary

When a government goes bust in a democracy (and most Western governments cannot possibly meet their unfunded liabilities) the majority of people who have no assets or just a few assets will always find it appealing to collect money from the evil “fat cats” (in the case of the US, the 1% who own 42.7% of financial wealth). It should be obvious that if 80% of the population owns just 7% of financial wealth, they will be tempted to transfer at some point in future, part of the wealth of the 5% or 10% richest Americans to the masses that have no savings.

The problems we face today are there because the people who work hard for a living are now vastly outnumbered by those who vote for a living.

Normally, we analyze various asset markets and individual investment opportunities according to their merits. But now, we also need to think which asset classes are the least and which ones are the most vulnerable to wealth taxes.

Friday, April 5, 2013

Future bailouts are dangerous to depositors

The Cyprus incident now shows that, from now on future bailouts can affect depositors as well as tax payers, while in the past the bailouts didn't affect depositors as much.

Thursday, April 4, 2013

There should be no deposit insurance

On Cyprus:

The MF global collapse had a negative effect on the depositors.  By having a deposit insurance consumers don't worry about which Banks and Institutions are safer. But without deposit Insurance consumers will be more cautious.

Tuesday, April 2, 2013

The great caution

When money is printed it doesnt flow equally into the market. My concern is we are going to have a systemic crisis that will may not allow us to even hide in gold.

Marc Faber is a famous contrarian investor and the publisher of the Gloom Boom & Doom Report newsletter.

Monday, April 1, 2013

US stocks dont have much higher to go

I think US stocks wont go too much higher from here and there is considerable downside risks.

Europe has current account surplus but their economy is in a recession and this will affect the US stocks as well. Bulk of the US corporations profits come from Europe. Also at the same time global liquidity is contracting.