Last Friday, well-known bear Marc Faber spoke to Bloomberg’s Kathleen Hays about the euro’s performance against the U.S. dollar, commodities, and the global economy. Some notable excerpts from the interview included:
The global economy is in recession already?
The U.S. would now outperform for 3 to 6 months?
I think the dollar can continue to rally somewhat to say 1.47 against the euro, then there’s some support there. The Europeans will have to cut interest rates as well, because their economies are most likely much weaker than it’s perceived. The emerging economies are also much weaker than it’s perceived. And so, on a relative basis, if you put a gun on my head and said you had to buy stocks somewhere, I would by U.S?
I think commodities individually, could easily drop 50 percent, as some have already done, like nickel, lead, and zinc, and others will follow. But after that, I think that the bull market in commodities will reassert itself. But, my view was, that, for the second half of 2008 commodities would go down?
Well, let me put it this way, I personally am not buying U.S. stocks, but am long the dollar right now?
Where I’m also long and optimistic is essentially about Japan. And I would be very wary of the favorite trades of the last say, two years, long commodities, long steel stocks, long iron-ore companies, that kind of sector I would avoid?
You can listen to the 5 minute 18 second interview here.
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Tuesday 14th of October 2008
I enjoy reading comments by top invetment gurus such as Faber, Mobius, Soros, Buffett, Rogers, Pimco's Bond expert, etc.