Marc Faber Breaks Down U.S./Emerging Markets, Gold, Treasuries and Economy (1/25/2011)

Marc Faber (Gloom Boom Doom Report) on BloombergTV 1/25/2011 (video after the quotes).

U.S./Emerging Markets: "And now we have a change, where I think for a while the U.S. may outperform, may not go up, but it may go down less than emerging markets."

"In the longer run, for sure, U.S. Treasuries and most Government bonds are a suicidal investment. But there's a shorter term time frame. And I think for the next 3 months or so we have a situation where stock markets have become way overbought and emerging markets in January, most of them failed to make a new high above the November/December highs. And that is a negative sign."

"I think the sentiment just recently was overly optimistic about the inflation trade (commodities, equities and so forth) and overly negative about Treasury bonds. So Treasury bonds right now are oversold. And as of tonight I got a buy signal on U.S. Treasuries. But not for the long term, I think it's a rally that may last 2-3 months."

"I think Treasuries are the best place for the next 10 days and probably for the next 3 months, as is the U.S. Dollar."

Gold: "Yeah I like gold but I think it will go down for the time being. There's an ongoing correction and from the top to the bottom the correction could be 20%".

U.S. Economy, Federal Reserve: "I think what should happen in the U.S. is for a President to tell the U.S. you have to tighten your belts. We have to go through hard times for 5 years to repair the damage that was committed over 20-25 years by the Federal Reserve, by the Treasury, by the Politicians." And somebody has to tell the truth. But the politicians keep on fueling an illusion that you can spend yourself out of the misery and that by printing money you can improve the economy, which is not the case."




Source: Faber Expects 10% Drop in S&P 500, Says Stocks Expensive: Video (Bloomberg.com)

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