Google Search

Wednesday, September 21, 2011

Marc Faber's September Outlook: The Calm Before the Storm


Marc Faber is out with the latest issue of his famous Gloom, Boom, and Doom Report which is always a must read for serious investors. Unlike most of the other talking heads, Faber has an excellent track record. He correctly predicted the top in the equity markets in Nov 2007 and caught the bottom in March 2009, making his subscribers a lot of money. Here is a summary of his September 2011 report:

1. Stocks---Faber says stocks face two potential outcomes: a brief rally to between 1250-1300 on the SP 500 before another leg down (and breaching the 1101 low) or a prolonged trading range with 1100 being the low and 1300 as resistance. Faber thinks the first outcome is more likely, but this could change depending on Fed policy (aka: money printing). Another reason for Faber's bearish posture is the unfavorable seasonality of September (worst month for stocks historically). Investors who have exposure to stocks should use any bounce to sell. If you feel compelled to own stocks, Faber recommends blue-chip stocks like Pepsi and Johnson and Johnson.

2. Gold--Extremely overbought at this level. Could fall to $1500-1600 range during the correction. Faber noted the bizarre relationship between US treasuries and gold. Concludes that the people buying gold were not worried about inflation but a collapse of the entire financial system. Gold should be viewed as more of an insurance policy rather than an inflation hedge. Long-term gold is going significantly higher. Gold stocks may be the better bet than the physical metal in the short-term as they play catch up.

Read More


Latest Economy
- How the Government Can Create Jobs
- The True "Spread the Wealth Philosophy"
- More of the Same
- Marc Faber: Gold is "Dirt Cheap" -- Price Could Reach $10,000 per Ounce
- Why Do Republicans Want to Raise Taxes?
- News Flash: U.S.P.S. is broke
- Labor Union Becomes Laughing Stock
- 70% of U.S. bonds mature in five years

This site contains copyrighted material the use of which in some cases has not been specifically authorized by the copyright owner. Such material is made available for the purposes of news reporting, education, research, comment, and criticism, which constitutes a 'fair use' of such copyrighted material in accordance with Title 17 U.S.C. Section 107. If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission from the copyright owner. It is our policy to respond to notices of alleged infringement that comply with the Digital Millennium Copyright Act (found at the U.S. Copyright Office) and other applicable intellectual property laws. It is our policy to remove material from public view that we believe in good faith to be copyrighted material that has been illegally copied and distributed by any of our members or users.
About Us - Disclaimer - Privacy Policy
"Men occasionally stumble over the truth, but most of them pick themselves up and hurry off as if nothing ever happened..." - Winston Churchill


View the original article here