China Bubble Poses Global Risk

"If Chinese growth really slows down or if they have a crash... it could trigger a vicious circle on the downside and I would say there is a fairly good chance that this could happen," Marc Faber, managing director, editor and publisher at The Gloom Boom & Doom Report told CNBC. "This would be really something the world's central bankers wouldn't be able to help with printing money," he added.



Contrarian Investor Dr.Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

The Bear Market Is Starting

"The bear market is starting. When you compare equities to bonds and cash I don't think equities are very positive," Faber said in an interview with CNBC
"The Treasury market is telling you that the economy is in recession," said Faber. "So if the bond market is telling you that the economies of the Western world are weakening, but at the same time the stock market is still relatively high, I think the stock market is vulnerable."
"The politicians are all useless individuals. Nobody is reducing the problems in the US or Europe, just putting on a band aid and postponing the problems endlessly," he said.
"Some analysts think that there's a chance economic data will surprise on the upside but I think, if anything, it will be on the downside," Faber added.
Faber argues that China disappointing "is a much bigger risk for the global economy than the US because the US is no longer a major commodities buyer"
"If commodity prices are falling, then commodity producers will buy fewer goods from China," he pointed out. "This is something that the world central bankers can't deal with."
"What surprises me more is actually the strength of the euro and that it has not collapsed yet," he said
"I would have chucked out Greece three years ago, straight away, and it would have been much cheaper," Faber said.


Contrarian Investor Dr.Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.