February 27, 2017
Expect an ‘avalanche’ of selling when this market breaks, says Marc Faber
But “Dr Doom” says don’t blame Trump if stocks start to sell off
By Barbara Kollmeyer
Marketwatch.com
The apocalypse is coming for this stock market and when it does, the selling will resemble an “avalanche.”
That’s the latest dire prediction of Dr Doom, aka Marc Faber, the editor of “The Gloom, Boom & Doom report,” who advised investors to put less in U.S. stocks on Monday.
“Very simply, the market starts to go down. As it goes down, it will start triggering selling, and then it will be like an avalanche,” said the notoriously bearish Faber, speaking on CNBC’s “Futures Now.”
Faber was already predicting as far back as August 2016 that the S&P 500 would crash 50%. That’s even as he said in September that “extreme money-printing” could push the Dow industrials as high as 100,000.
But while stocks have been driven higher by Donald Trump’s victory in the U.S. presidential election and hopes for economic stimulus to come from the new administration, Faber said that Trump optimism can’t be blamed in a big market selloff. He said stocks are far too overbought and investors too bullish — the post-election rally has been accompanied by pauses in trading action rather than deep pullbacks for stocks.
The Dow industrials are each up over 5% year-to-date, with the Nasdaq Composite Index nearly 9% higher. Bullish sentiment, or expectations that stocks will rise over the next six months, was up 5.4 percentage points at 38.5%, according to a Feb. 23 survey from the American Association of Individual Investors.
But that AAII survey showed pessimism about the market, or those who think stocks will fall, remains above its historical average, at 32.3%.
“Trump, unlike Reagan, is facing huge, huge headwinds — including a debt to GDP that is gigantic, as it is in other countries,” said Faber.
As for what assets he does like right now, Dr Doom said further money-printing by the U.S. government is likely on the cards, which will likely deliver good returns for gold and copper. On top of that, he says China looks attractive to him as an investor.
“The economy, surprisingly, has begun to do quite well. We see that in retail in Hong Kong. We see that in the hotel industry, and we see that in the demand for commodities,” he told CNBC.
http://www.marketwatch.com/story/expect-an-avalanche-of-selling-when-this-market-breaks-says-marc-faber-2017-02-27
Gold is $1,581/oz today. When it hits $2,000, it will be up 26.5%. Let's see how long that takes. - De 3/11/2013 - ANSWER: 7 Years, 5 Months
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