My favorite economic entertainer is back with his usual over-the-top semi-apocalyptic comments about government officials, the U.S. and more. Here are a few choice quotes from Dr. Doom followed by the full videos of his session on Squawk Box on CNBC Europe below.
On Obama
I don’t have a very high opinion of Mr. Obama. I was negative of Mr. Bush but I think Mr. Obama makes him look like a genius.
On U.S. States:
The worst investment managers worldwide have been the state pension funds in the United States. They bought everything right at the peak and basically got out of things right at the bottom. And so they’re now facing a shortfall in unfunded liabilities of $2 trillion.
On the U.S.:
When you look at the United States … it’s a total disaster, we’re all doomed, we’re doomed!
On the U.S. Dollar:
In my opinion it’s beyond repair. If the US were a corporation and had proper accounting, they would be ‘Triple C, ‘ nobody would buy their bonds."
Having said that, in the near term I think the dollar could rally because the others are no better, the others are worse. I think that the dollar will rally now against the euro and against the pound sterling and probably against the yen.
The videos are embedded below.
Of course, Faber contradicts himself fully on Obama and regulation because he says:
When someone tells me the government should regulate the banks, they shouldn’t. It’s a disaster. But they should have interest rates that are high, that curtail speculation.”
Just three months ago he said the exact opposite about the Central Bank of India on CNBC TV18 there. See the segment in the second clip from 2:00 in my post Marc Faber: “Monetary policy in the United States will stay expansionary”.
When asked about India, Faber says:
The Reserve Bank of India has one of the best monetary policies in the world because they supervise the financial sector very closely, they have maintained relatively tight monetary policies, and also they pay attention not only to core inflation… but the Reserve Bank of India also pays attention to rising asset prices and falling asset prices.
He is consistent about interest rates and inflation here. But the part highlighted in bold is a clear statement in support of regulatory oversight. So, his statements on CNBC Europe about the U.S. and regulation are absolute rubbish. He is obviously bashing the U.S. because that’s his shtick. However, you can see the contradiction point blank right here.
Faber does the same thing on gold, saying:
The price of gold is likely to hover between $950 an ounce and $1050. I doubt we’ll go below 1,000.
Really? That contradicts a statement he made just two months ago. On CNBC TV18 India in November he said:
"I don’t think that you’ll see gold below $1,000 per ounce probably ever"
Now, he’s talking $950. I agree that gold was seriously overbought at $1200 and now investors should be wary (see Marshall’s last post “A strong dollar, euro downside and a gold liquidation panic” for why). But if you’re going to make a strong statement about gold never going below $1,000, don’t come back two months later saying something else.
Faber is certainly entertaining and his analysis can be useful in context – like in the case of U.S. state fiscal problems. But you have to take much of what he says with a grain of salt; much of what he says is for shock value and nothing more.