Publisher of the Gloom Boom and Doom Report, Marc Faber, was interviewed by CNBC’s Becky Quick this morning and provided his outlook for 2013 regarding the markets. Faber indicated he would be wary of things which have performed well since the bottom in 2009. Stock markets in Malaysia, Indonesia, the Phillipines, Thailand would not do particularly well in 2013, he said.
However, when he looks at the kind of money “sloshing around the world,” Faber believes investors should look at poorly performing stock markets such as Vietnam, China, Ukraine, and until recently, Japan. Faber said money will shift from the relatively high valued markets into the markets that have had horrible performance, particularly Japan.
Faber is cautious on 2013 since stocks have had a huge runup from the lows in March 2009. Asian stock valuations aren’t particularly stretched in comparison to interest on deposits in banks and less than 2% yields on 10-year Treasuries. But at the same time, Faber has seen a deterioration in the technicals of the market, and therefore he is relatively cautious regarding 2013.
Faber cautioned there is so much government intervention in the markets, as is always the case, making it difficult to make any predictions about the future. Research papers show that forecasters are as often wrong as they are right, but with government intervention it is even worse, he added.
Faber said he was distressed by his inability to find any assets to invest in at this stage. He feels deeply uncomfortable about the economic position, geopolitical position, and social unrest existing in the world.
In spite of his concerns, Faber said he didn’t believe the U. S. dollar would collapse right away, and could actually rally somewhat.
Faber said he owns gold, but that it probably won’t go up right away and could correct 10% or so from here. He expects governments to print money in competitive devaluations, so he wants to hold gold as an insurance policy.
Faber said he considers the Singapore dollar a good currency to own while he prefers the U. S. dollar over the euro.
Back in October, Faber said he believed China and Japan represented an investment opportunity [link].