Marc Faber Warns "Insiders Are Selling Like Crazy... Short US Stocks, Buy Treasuries & Gold" | Zero HedgeBeginning by disavowing Mario Gabelli of any belief that rising stock prices help 'most' people ("Fed data suggests half the US population has seen a 40% drop in wealth since 2007"), Marc Faber discusses his increasingly imminent fears of the markets in this recent Barron's interview.
Quoting Hussman as a caveat, "The problem with bubbles is
that they force one to decide whether to look like an idiot before the
peak, or an idiot after the peak. There's no calling the top,"
Faber warns there are a lot of questions about the quality of earnings
(from buybacks to unfunded pensions) but "statistics show that company insiders are selling their shares like crazy."
His first recommendation - short the Russell 2000, buy 10-year US
Treasuries ("there will be no magnificent US recovery"), and miners and
adds "own physical gold because the old system will implode. Those who own paper assets are doomed."
Faber: This morning, I said most people don't benefit from rising stock prices.
This handsome young man on my left said I was incorrect. [Gabelli
starts preening.] Yet, here are some statistics from Gallup's annual
economy and personal-finance survey on the percentage of U.S. adults
invested in the market. The survey, whose results were published in May,
asks whether respondents personally or jointly with a spouse have any money invested in the market,
either in individual stock accounts, stock mutual funds, self-directed
401(k) retirement accounts, or individual retirement accounts. Only 52% responded positively.
Gabelli: They didn't ask about company-sponsored 401(k)s, so it is a faulty question.
Faber: An analysis of Federal Reserve data suggests that half the U.S. population has seen a 40% decrease in wealth since 2007.
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