Tuesday, August 23, 2011

Marc Faber's Top 5 Suggestions For Investors - Barron's (blog)

Hong Kong-based investment manager Marc Faber, a member of Barron‘s Roundtable, just last weekend warned in the magazine that stocks would drift lower.

Gold is likely to correct, he added, something that’s looking more possible each passing day even though the popular SPDR Gold ETF (GLD) moved higher this week.
He’s also bullish on silver, which saw the iShares Silver ETF (SLV) stage  a technical breakout on Friday.
Faber reiterated his recommendation to short Salesforce.com (CRM) as well.
The publisher of “The Gloom Boom & Doom Report” took time this week to talk to Jonathan Burton, MarketWatch’s money and investments editor. (See video above.)
Faber didn’t offer much that we haven’t heard before, but some of his top suggestions were put into a Top 5 list of things investors should focus on:
1.) Avoid Treasuries. “The dollar may rally somewhat, but clearly in the long run the dollar and other paper currencies — the euro is not much better — will have a depreciating tendency vis-a-vis honest money: gold and silver.”
2.) Cash is trash. “Paper money has lost its value. Hyperinflation is the pattern to come.”
3.) Stocks offer some safety. “My assumption is that March 2009 was a major low, and that we will not go back below that low.”
4.) Emerging markets will expand. “I can buy you a portfolio of high-dividend stocks in Asia that would have a yield of 5% to 7% … The banks in Asia are in a very solid position. All these are a play on the recovery in the stock market in Japan.”
5.) Gold is worth its weight. “Intelligent people, instead of holding cash in U.S. dollars with zero interest rates, why not hold money in gold and silver?”