Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

Marc Faber: China Bubble Crash Poses a Huge Global Risk(fire half of gov & Obama)
Market Oracle ^ | 08/04/11 | Aftab_Singh

Posted on 08/05/2011 2:49:28 AM PDT by TigerLikesRooster

Marc Faber: China Bubble Crash Poses a Huge Global Risk

Stock-Markets / Financial Markets 2011 Aug 04, 2011 - 01:48 AM

By: Aftab_Singh

Stock-Markets

Best Financial Markets Analysis ArticleMarc Faber was interviewed on CNBC yesterday. He had some interesting thoughts on China, geopolitical trends, gold, equities, bonds and cash. See below for the video and summary.

Summary:

Disappointing growth (or a crash) in China is a huge risk for the global economy.

If Chinese growth really slows down (or if they have a crash), it will impact Australia, Brazil, the Middle East, Canada etc.

This could backfire as commodities producers buy less goods from China. This could trigger a vicious spiral on the downside. There is a good chance that this could happen.

The world central bankers would really not be able to help if this comes to pass. Maybe they could prop up the financial markets by supporting equity prices, but they would not be able to help the real economy.

If you’re ultra-bearish about everything, then you’re probably better off in equities than in bonds and cash. Precious metals would probably be the best. 10 years ago, a huge shift in economic power away from the West and towards Developing Economies began. The EM goods markets are far larger than the Western goods markets.

This shift in economic power from the West to Developing economies is accompanied by a shift in political and military power. The West will not just sit there and do nothing – the Libyan expedition is the ‘first shot’. The Western world will want to control the oil flowing to China from the Middle East. Then it will come to war – and you definitely don’t want to own US government bonds then!

In the worst scenario, you don’t want to be in dollars and government bonds.

People in the west have abandoned personal responsibilty for their actions. Asia is different — people have to keep reserves for the things that would be insured by government in the West.

China is lucky because they don’t have government healthcare. The US should fire half the government including the president.

In Asia, things like abortion are never discussed. They believe it is up to the individual to take responsibility for his life.

Compared to the US government debt and the monetary base, the gold price is probably cheaper today than it was 10 years ago.

Having said this, we had a little bit of euphoria in the gold market recently and a correction is due.


TOPICS: Business/Economy; Extended News; Foreign Affairs; News/Current Events
KEYWORDS: china; crash; marcfaber; war

1 posted on 08/05/2011 2:49:34 AM PDT by TigerLikesRooster
[ Post Reply | Private Reply | View Replies]

To: TigerLikesRooster; PAR35; AndyJackson; Thane_Banquo; nicksaunt; MadLibDisease; happygrl; ...

P!


2 posted on 08/05/2011 2:50:14 AM PDT by TigerLikesRooster (The way to crush the bourgeois is to grind them between the millstones of taxation and inflation)
[ Post Reply | Private Reply | To 1 | View Replies]

To: TigerLikesRooster
In Asia, things like abortion are never discussed. They believe it is up to the individual to take responsibility for his life.

can you see the question marks floating over my head, like they always do in the first milliseconds after I encounter a nuclear non-sequitir?

3 posted on 08/05/2011 3:53:30 AM PDT by _a_0_0_
[ Post Reply | Private Reply | To 1 | View Replies]

To: _a_0_0_

You beat me to it. Good grief, but what a dumb thing to say! Can we say “China 1-child policy, forced abortions and sterilizations, etc.”?


4 posted on 08/05/2011 5:04:57 AM PDT by paladinan (Rule #1: There is a God. Rule #2: It isn't you.)
[ Post Reply | Private Reply | To 3 | View Replies]

To: TigerLikesRooster

VIDEO
Marc Faber: Fire 50% of the US Government including Obama

http://www.youtube.com/watch?v=ri8_ux8ZCL0&feature=player_embedded


5 posted on 08/05/2011 5:08:07 AM PDT by Whenifhow
[ Post Reply | Private Reply | To 2 | View Replies]

To: TigerLikesRooster

I think we should be more worried about ONGOING problems like the Euro crisis and the possibility of an Italian default, not hypotheticals.


6 posted on 08/05/2011 7:36:38 AM PDT by AfricanChristian
[ Post Reply | Private Reply | To 1 | View Replies]

To: TigerLikesRooster

Thanks. Faber’s one of my favorites...


7 posted on 08/05/2011 12:09:05 PM PDT by GOPJ (This “wussification” of America is an on-going phenomenon.- freeper rokkitapps)
[ Post Reply | Private Reply | To 2 | View Replies]

To: TigerLikesRooster
If you’re ultra-bearish about everything, then you’re probably better off in equities than in bonds and cash. Precious metals would probably be the best. 10 years ago, a huge shift in economic power away from the West and towards Developing Economies began. The EM goods markets are far larger than the Western goods markets.

This shift in economic power from the West to Developing economies is accompanied by a shift in political and military power. The West will not just sit there and do nothing – the Libyan expedition is the ‘first shot’. The Western world will want to control the oil flowing to China from the Middle East. Then it will come to war – and you definitely don’t want to own US government bonds then!

In the worst scenario, you don’t want to be in dollars and government bonds.

Seems the world is awash in debt - not a good thing for holding bonds... but getting into equities feels scary. Faber's probably right ... usually is.

8 posted on 08/05/2011 12:15:24 PM PDT by GOPJ (This “wussification” of America is an on-going phenomenon.- freeper rokkitapps)
[ Post Reply | Private Reply | To 1 | View Replies]

To: TigerLikesRooster
Having said this, we had a little bit of euphoria in the gold market recently and a correction is due.

I've heard it cited that less than 10% of investors have diversified a portion of their nest egg into gold, one of the best performing assets over the past 10 years. Financial analysts resist the archaic, unproductive asset, but instead steering risk-averse investors into negative return treasuries or even blue-chip stock.

Gold is not in a bubble, it is merely retaining value against many a severely declining fiat currencies. The Swiss franc has gone up 30% over the past year in terms of the US $ - a bubble?

At Kitco go check out the currency chart of the Swiss Franc vs. US $ (bottom of page), and gold priced in Francs.

Just the US lying, thieving government at work.

9 posted on 08/06/2011 8:59:21 AM PDT by GregoryFul (Obama - Jim Jones redux)
[ Post Reply | Private Reply | To 1 | View Replies]






Donate and feel great



10 posted on 08/06/2011 9:46:03 AM PDT by TheOldLady (FReepmail me to get ON or OFF the ZOT LIGHTNING ping list.)
[ Post Reply | Private Reply | View Replies]

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson