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Friday, July 5, 2013

Marc Faber: China will not end well

There has been a huge credit bubble in China, and it isn't going to end well. Its economy officially grew 7.7% in the first quarter. In reality, it is growing 4% a year, at best. Figures on Chinese exports to Taiwan, South Korea, Hong Kong, and Singapore don't agree with the import figures of those countries. In each case, reported exports are much larger than reported imports. Singapore publishes relatively honest economic statistics. Its gross domestic product has hardly grown in the past six months. Inflation is about 4% a year. Here in Thailand, growth has slowed despite massive fiscal stimulus. Trade and current-account surpluses have been shrinking in Malaysia, Indonesia, and other countries. Again, the economy of the rich is booming. There has been huge wealth accumulation in Asia in recent years. But the middle class has experienced diminishing purchasing power. Throughout history, growing wealth inequality has been corrected either peacefully, through taxation and wealth redistribution, or by revolution, as in Russia. I am not sure we will have a revolution in the Western world, but I can see European voters turning against the arrogance of the bureaucracy. There have been so many scandals involving French politicians with Swiss bank accounts, and so forth.

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

Cash in US Dollars is king

I hold lots of cash, in U.S. dollars. Plus, I like some other investments such as the India Capital Fund, which is available to accredited investors. The fundamentals of Kazakhstan are strong, but the country's bonds have rallied. Thus, I prefer shares of Kazkommertsbank, which trade for less than one times book. Finally, the Euphrates Iraq Fund is a way to play an early-stage frontier market that is starting to attract local and foreign capital.

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

Marc Faber: The Stock Market is Risky

Marc Faber is a great contrarian investor and publisher of the Gloom Boom & Doom Report. He is well known for his accurace predictions of stock market crashes and other correct calls on different investment assets.

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

MARC FABER BLOG

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