Marc Faber Blog

Tuesday, May 24, 2016

Donald Trump is a better choice to Hillary Clinton


Whether he will be a good president? I don’t know but given the other options, I’d rather take Trump, who is not the most honest person but in my view, more honest than Ms. Clinton. 

Tuesday, May 17, 2016

Rick Rule is right on Gold shares

I tend to agree with Rick Rule that gold shares, okay, they’re down 80%, and they are cheap, compared to the physical price of gold and compared to Facebook and Google and all these Netflix type of stocks. That I agree entirely.

Tuesday, May 10, 2016

Modi has impressed in India although he could have done more


Even if India grows at 6 per cent per year, it would see huge interest among investors. India has not seen much flows as global investors are underweight towards India. This is because between 2007 and 2013 India disappointed and it saw a weak currency. 

It’s not an easy task to evaluate the performance of a government because of the system Prime Minister Modi is operating in, which is highly bureaucratic and surrounded by red tape. I think he could have done some more reforms. In my view, elimination of subsidies is good and the Rural Employment Act should altogether be scrapped. Modi is not negative for the economy but it seems he is operating under some constraint. However, so far his performance has been good.

Tuesday, May 3, 2016

Until recently it was inconceivable that a Western country could go bankrupt

The Swiss fought for independence for the last 800 years and now suddenly they accept everything! They have no fighting spirit anymore!

But let´s assume some countries are ready to leave the euro zone. In the case of Greece this would go along with a major haircut or an outright default...

Yes, but a haircut and the default will occur regardless. I mean, even the IMF accepts the fact that the Greek debt has to be reduced somewhat. What they have done lately is the EU lends money to Greece and Greece then can pay the ECB and the IMF. 

It is a complete joke! It is like if you borrowed money from me, a thousand dollars, after one year you say, Marc look I can´t repay you and I can´t pay the interest, but if you lend me another thousand, then I can pay you the interest on the first thousand. But then you owe me two thousand!

And after the third year you come back and say Marc I´m very sorry, I can´t pay you the two thousand maybe you will lend me another thousand so I can at least pay you the interest on the two thousand! And so the game goes on. When you look at Greece objectively, private investors would never have lent all together 300 billion dollars to Greece, never! But governments are the peoples´ money you understand?

The ECB and the ESM and so forth are other peoples´ money, they don’t care.

It would have huge implications, after all over the last 40-50 years it was inconceivable that a Western country would actually go bankrupt.