Â Dr. Marc Faber as a guest host on CNBC Squawk Box, May 25, 2009. Dr. Faber discusses the US stock market and dollar, gold, commodities, geo-political events andÂ international economies and markets. (Videos follow excerpts and comments below)
I’m not sure we’re going to go back to a gold standard. In the future sometime paper money, not just the US Dollar, Â but in general, paper money will become pretty worthless. Then a new system will be implemented. Between today and when we get there I think we will have social unrest, wars and destruction.
I read once that, on average, humanity has fought one war every 3 years since written history. Considering the fact that we have wars being fought all over the world by various nations and organizations, this is probably a good figure to go by. I am no war historian, but I would venture to guess that in most cases wars were fought during times of economic collapse or national distress. According to Gerald Celente, we are headed into the worst crisis of our life times. This does not bode well for world peace, no matter how much pageant beauty queens want it..
I own physical gold and I own gold mining shares.
What has happened over the last 18 months is that gold has held up reasonably well and all the other commodities collapsed. Especially exploration companies have totally imploded for the simple reason that they no longer get financing and also that resource prices went down.
I feel there is an opportunity to buy these exploration companies, the second liners, in Canada and that a lot of money will be earned there. And aside from that is to hold physical gold. I would rather hold it outside the US and probably ideally here in Asia and not in the United States.
Marc Faber smells something here, and of course, there is a historical precedence in respect to gold confiscation stateside. It is interesting that Dr. Faber did not mention Europe. While Europe is probably a safer place to store gold than the USA, i wouldn’t put it past the EU to sieze on an opportunity to enrich itself via confiscation – they are in as much financial trouble as the USA, so they certainly have motive.
I think in general, markets were very oversold on March 6, 2009. Many markets and many stocks in March when the S&P made a new low were far higher than they were in last October and November. Right now, many stocks have risen by more than 100% and the number of stocks above their 50 day moving average reached 90% the other day, which signals a very overbought position, certainly in the United States. And so I expect a correction to unfold.
Whether the correction is the resumption of th ebear market where we will make new lows or just a correction, that still remains to be seen.
Are you holding long positions in the US stock market (or even globally?). Perhaps it’s time to lock in profits and sit on the side lines until a new trend develops.
You can watch Dr. Fabers appearance on CNBC May 24, 2009. These videos are in no particular order.
Watch Marc Faber on CNBC May 24, 2009 (Part 1: The Dollar Will Be Worthless):
Watch Marc Faber on CNBC May 24, 2009 (Part 2: Market Correction Will Unfold):
Watch Marc Faber on CNBC May 24, 2009 (Part 3: Watch the Dollar):
Watch Marc Faber on CNBC May 24, 2009 (Part 4: Time to Invest in South Korea):
Watch Marc Faber on CNBC May 24, 2009 (Part 5: Future of Mongolia’s Mining Industry and More):
Watch Marc Faber on CNBC May 24, 2009 (Part 6: Nikkei to Rally to 14,000):