Monday, May 22, 2017

They will print money until there is a credit collapse

One day there will be a credit collapse, but I think we aren’t yet there.  Before it happens they’re going to print. And when printing as it has done in the last 12 years in the U.S. leads to  discontent populations, because when you print money then only a few players in  the economy that benefit, not the majority of households.
Janet Yellen

Tuesday, May 16, 2017

Marc Faber on Canada Real Estate and More

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Many people have been bearish on Canadian Real Estate and for many years. They have also been bearish on Canadian Banks. And so far they haven't been proven to be right. One day they will be right, the markets will go down. As you've seen in Vancouver, the markets went down over the last two years and the last six months later it picked up again. So there is still a lot of money sloshing around in the world and in general international investors view Canada more favorably than the US.

Wednesday, May 10, 2017

Marc Faber praises India and its economic policies

What I maintained more than a year ago that over the next 5-10 years, India would outperform the US and other western markets. I think it is still a valid story. In general, you have a new government, Mr Modi who is trying hard to implement some reforms and he has actually a far better chance to implement these reforms than Mr Trump.

Secondly, this is something that is very interesting for me as an observer of economic history. I think central banks in emerging economies such as India, as an example, are much more responsible and much better educated about the perils of money printing. Mr Rajan and Mr Patel have done a very good job so far in stabilizing the rupee. In local currency, the Indian market is up something like 13 percent this year.

But in dollar terms, the market is up close to 18 percent because first the stock market went up then the rupee went up. The stock market is not that important for the majority of Indians because it is only a minority that owns Indian shares. But, the currency is very important for the majority of Indians and for foreign investors.

If you have a steady currency, a strong currency, you have money coming from overseas, looking for investments in India and so, I remain actually quite constructive about India. And over the next 10-20 years, India has the potential, I am not saying it will realize it, but it has the potential at least to grow at 5-7 percent per annum each year which is huge compared to the growth that we have in the US and in Europe.

Monday, May 8, 2017

Why money printing can resume in the US and other countries

In the US we are now eight years into an economic expansion. This is a very old expansion. We are more than eight years into a bull market which is a very old bull market. If the market goes down substantially, we have a recession again and we expect that in the next 1-2 years, then the Fed, in my opinion, they will launch qualitative easing -QE 4. They may not call it QE-4, they may call it helicopter money or Trump money or whatever it is. But I think they will print money as they have in Europe and Japan up to this very date.

Deutsche Bank has recently produced a statistic or it was Bank of America whereby in the first three months of this year, the balance sheet of the ECB and the Bank of Japan (BoJ) increased by more than USD 1 trillion. So, annually, by close to USD 4 trillion, we still have money printing and we do not know where it will end. I think it will continue because that is all they can do.

Friday, May 5, 2017

Commodity investing VS Precious Metals

A correction in commodity markets, 10-20 percent is a huge move because, as an investor, you have the roll over costs and you do not have dividends on commodities basically. So, I would be a little bit careful about economic sensitive commodities such as steel, iron ore, copper, aluminium and so forth, but I still like precious metals because if you look around the world and you see all these academics and central banks.