Asked for his positioning ahead of the Greek elections by CNBC’s Melissa Lee, Marc Faber, editor of the Gloom, Boom and Doom Report, said recent strength in the dollar caused the euro to be oversold. Faber also expected the Greeks to decide to stay in the Eurozone. He added that the problems will be postponed because the Greeks will not implement the austerity measures that have been demanded by them.
Faber admitted he didn’t know what the ultimate outcome will be, but speculated it is quite possible that at some stage the Germans will lose patience and actually exit the Eurozone in 3-5 years; perhaps sooner.
“The countries that are weak…Spain, Greece, Italy, Portugal…they will not have the political will to implement the austerity that is demanded,” Faber said. He added that the strong countries do not have the political will to subsidize the weaker countries.
The interview continued with Faber discussing the effect of currency on imported commodities for Germany and the factor of labor costs in the high-end products produced there.