gsg_stock discussion

Marc Faber says sharp correction in all asset markets probable

From the latest May 2006 The Gloom, Boom & Doom Report:

"However, with the exception of the stock and property markets of Taiwan, Malaysia , and Thailand, there are practically no assets markets that don't evoke in my mind the characteristics of "too much money chasing too few assets", "overtrading', and "a larger and larger group of people seeking to become rich without a real understanding of the process involved". Moreover, if we look at credit growth in the US and at Foreign Official Reserve growth, it would seem that global liquidity , while still expanding at - by historical standards - relatively high rates, has been decelerating.

Therefore, a sharp correction in all asset markets, à la the Middle East since the end of last year, should be considered very probably."

"Finally, it is my belief that in future investors will have to become used to using "real" returns and not nominal returns. Under a monetary regime - the Fed - which has no option but to print money, all assets could rise in value in nominal terms, but some will obviously depreciate against "sound money" whose supply cannot be increased at liberty."

posted by gsg @ 12:08 AM