Any Large Decline in Gold Represents a Buying Opportunity, Says Marc Faber
Marc Faber the Swiss fund manager and Gloom Boom & Doom editor believes equities are ready to drop into October-November and then rally again towards the end of the year.
Writing in the October edition of The Gloom Boom & Doom report, Faber says the Fed will start printing money again and that would create a negative sentiment driving markets down. He doesn’t however see a threat to the March 2009 lows.
"Maybe the stock market won’t be very happy about additional stimulus, more interventions into the free market," he recently said, "though anything could happen, but let’s put it this way that I do not think that we will go and breakdown below the March 2009 level".
Faber sees a downside target of no more than 950 on the S&P on the pullback. Any break below 1,000 will rattle the Fed, he says, and rather doubts Federal Reserve Chairman Ben Bernanke will allow further market declines once 1,000 is reached.
Dollar extremely oversold
The US dollar is extremely oversold and investor sentiment is very bearish. As a contrarian, I would not be short the dollar right now, Faber says in his October report.
Gold correction possible
Faber also said there could be a significant correction in gold and other commodities as the dollar changes course. However any large decline would represent a buying opportunity, he argues.