With gold prices breaking several all-time records this week, you would think most would think it's getting expensive to acquire the yellow metal, but not Marc Faber, who says gold bullion prices aren't expensive in his view.
At a CLSA Investors' Forum 2010 in Hong Kong, Faber said, Given all the unfunded liabilities and the money printing in the world and the size of the financial assets in the world, I don't think we are in a bubble.
While Faber doesn't believe we're in a bubble with gold, he does advise investors to increase their exposure on a monthly basis, and not to increase the percentage of their overall wealth too much into the metal, even as gold prices continue to skyrocket.
He also said there still will be strong corrections at times, a reason he suggest investing on a consistent basis instead of all at once.
Faber said under the right conditions, there could be a pullback as high as 30 percent. He cited the 50 percent drop in gold prices in the 1970s, where prices fell from $195 an ounce to $105 an ounce, although they resumed their upward climb to over $800 an ounce afterwards.
The point he's making is don't attempt to time the gold market.
Reprinted with permission from Commodity Surge.
September 21, 2010
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