Faber: US Has Become An 'Emerging Economy'

Friday, 01 Apr 2011 08:27 AM
By Julie Crawshaw

Gloom, Boom and Doom editor Marc Faber says the U.S. has effectively become "an emerging economy, but a very bad one," whereas others such as Mexico Thailand are much better.

"In Thailand, I can buy you some telecom shares that have a dividend yield of 7 percent and 9-10 times earnings," Faber tells Bloomberg. "So if someone tells me the U.S. market is very cheap, I can say, 'Where is the growth today in corporate profits? It's largely in emerging economies."

"Can the U.S. market outperform emerging economies? Sure."

But in the long run, emerging economies that experienced problems in the 1980s and 90s "are realizing that through prudent economic management they can achieve a lot."

Faber says he started to go to Mexico in the late-1980s and is amazed at the changes that have occurred since then. “Today, Mexico City is a fantastic city, very beautiful,â€