Something fishy about the gold market

All  I want to say is, something is fishy about the gold market in the sense that if the Germans demand to have a part of the gold received in Germany, I think it would take eight years, we should put gold on three Boeings 747′s and you ship it to Germany and that’s it.




If the gold would be held in Germany, in a vault, and if there was a financial panic and they really needed to draw loans against the gold that they hold in Germany, they could obtain loans at any time from a bank or from another central bank or whatever it is. So they could have the gold in Germany and if they wish to obtain a large loan against those gold reserves and they wouldn't be that much anyway, but if they wanted to obtain a loan, they could have an auditor come and check the gold and then a bank or a central bank would essentially lend them money against that gold.

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

Emerging economies currently in no growth environment

Well, basically the U.S. market is in the sky, we have a very strong outperformance of U.S. stock vis-à-vis Europe until a year ago and vis-à-vis emerging markets until now. But the European economies are a large portion of the U.S. corporate earnings, but they’re not growing. The U.S. is hardly growing. Growth came from emerging markets and these emerging economies are essentially today in a no-growth environment. I live in Asia, so I am quite familiar on my observations on the ground. We have no recession that is visible. It is often seen like a pain. But we’re just at the high level of economic activity; no longer growing. - See more at: http://www.marcfabersblog.com/#sthash.pXdGQP3D.dpuf

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 been through 2 Gold Bubbles already

Well, I lived through the bubble in gold in the 1970′s and by 1979, November, the gold price was around 450 Dollars and within three months it went up to 850 Dollars, so within three months, actually two months, November, December and early January, we made it big. It went up almost 50 percent. So a bubble usually characterized by a terminal upwards move in these real estate or gold or stocks or collectables that is almost vertical. In other words, an acceleration on the upside. And that hasn’t happened yet.

Moreover, one of the symptoms of a bubble is widespread public market invasion, in other words most people are one way or the other involved in the market, in real estate, like in the U.S. in 2007 or in NASDAQ stocks in 2000 or on other … Or in the 70′s, in the 70′s, when I was running Drexel Burnham at that time, our office was like a casino; people came in to trade gold 24 hours a day. That doesn’t happen today.

Okay, we have now better communication so we have the internet on which you can place orders through the internet and through phones and others but if I go to conferences and I talk about investments, I frequently ask the audience, how many of you own gold and how many have, say more than five percent of your assets in gold? Most, I mean, if at most three to five percent of the audience owns any gold, that’s about it. So where, say 12 years ago, if I had asked, who of you owns NASDAQ stocks, maybe 80 percent would have said, yes. So based on the ownership of gold from financial institutions and also based on the public participation, I don’t think we’re in a bubble.


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

FED Policy Has Made the Wealthy Wealthier

"We are in a gigantic asset bubble around the world with prices of real estate having risen a lot," he said. "The high end is at record highs. In the Hamptons, in Mayfair, London, Hong Kong, Singapore, and we have a high inflation overseas, so I think that one day this asset inflation will lead to deflationary collapse one way or the other."

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