Marc Faber expects a return to massive quantitative easing by October
Source: BI-ME with Bloomberg , Author: Posted by BI-ME staff
Posted: Fri July 16, 2010 8:25 pm

INTERNATIONAL. Marc Faber the Swiss fund manager and Gloom Boom & Doom editor said the US is so full of debt, stuck in a period of slow growth and high enemployment, that the Federal Reserve will soon have to revert back to crisis era policies.

Speaking to Bloomberg in a live interview Thursday, Faber said: " I am conviced the Fed will soon implement further quantitative easing," adding "and massively so".

"It will probably happen in september, October," Faber said, putting a timeline to his prediction.

Explaining his reasoning, he said: "The US economy is not robust".

Not buying into the good news brigade of commentators who believe the worst is behind us and the US economy is on the mend, he said: "We have mixed signals, but in general the economy is still weak".

Nor has the recent rise of the euro dampen his views on Europe. Faber said Europe does not have a shot at growth and is stuck in sideways movements in its economy, for years to come, as austerity and bailouts weigh on growth.

In his latest monthly market commentary the famed investor discloses a bit more about his investment philosophy.

"I feel that most investors take far too many risks – often with borrowed money – and fail to diversify sufficiently. They also have little patience, very short-term time horizons and no tolerance for losses," Faber writes.

"Their expectations about investment returns are completely unrealistic… Most investors buy a stock or make an investment with the view that within a month the return should be between 10% and 20%," he adds.

"If you can achieve an annual average real return of just 3% on all your assets (inflation adjusted), you will leave a huge fortune to your children".

I prefer diversification and no leverage," he adds explaining "I have seen time and again investors (including myself) be right about an asset class' future performance but fail to convert those views into any capital gains…"

"The prime consideration should always be capital preservation and avoiding large losses," he concludes.

RELATED ARTICLES

I buy gold, I don't know what else to buy, says Marc Faber

Marc Faber warns of expropriation if gold prices explode

I own my physical gold and I will never sell it, says Marc Faber

We already have a new gold standard, says Marc Faber

'Buy some gold every month' as protection against falling currencies, says Marc Faber

Marc Faber sees 'no huge downside risk for gold,' more sovereign defaults

George Soros boosts gold ETF stake despite 'ultimate bubble' claim

Marc Faber says 'we are all doomed,' predicts cyber wars

'The risk is really not to own any precious metals at all,' says Marc Faber

Is gold in a bubble? George Soros reignites the debate

Marc Faber, George Soros agree gold prices set to rise

 

MIDDLE EAST BUSINESS COMMENT & ANALYSIS

date:Posted: April 22, 2014
UAE. "Adapt to Survive", a global study by PwC, commissioned by LinkedIn, reveals the economic impact of not having the right people in the right jobs.
date:Posted: April 22, 2014
KUWAIT. For much of the past decade, international companies operating in the major projects sector have found Kuwait a challenging market in which to do business. However, there are good reasons to believe this year will be different.
date:Posted: April 22, 2014
INTERNATIONAL. The infrastructure bottlenecks need to be resolved urgently if the U.S as a whole is set to reap the benefits of the shale boom in the form of cheap and widely available gas.
INTERNATIONAL. Oman's plan to build a US$1 billion natural-gas pipeline from Iran is the latest sign that Saudi Arabia is failing to bind its smaller Gulf neighbours into a tighter bloc united in hostility to the Islamic Republic.
dhgate