Faber: Markets Should Brace for More Meltdowns, War

Faber: Markets Should Brace for More Meltdowns, War

Friday, 05 Aug 2011 09:20 AM
By Forrest Jones

Investors should view market rallies as selling opportunities because stock markets are headed for a string of selloffs and the globe is headed for more economic crisis and ultimately war, says investor Mark Faber, editor and publisher of the Gloom, Boom & Doom Report.

The Dow Jones Industrial Average fell over 500 points recently but will likely spike upward in the coming days.

Look at those as upward spikes in an overall tanking market.

"In general, I would be using rebounds as a selling opportunity," Faber says, according to CNBC.

"You have a computer. Occasionally the computer will crash and you have to reboot it. That will happen to the global economy. Before this happens there will be much more money printing because basically the central banks are willing to do that."

The Federal Reserve may unveil fresh stimulus measures, known as quantitative easing programs, which basically print money and inject it into the economy to fuel more growth.

That won't work, Faber says, because it only exacerbates the next crisis that follows.

"It's like the recession in 2001. Had there not been massive money printing, it would have been steeper than what we had, but equally, we would have avoided probably the financial crash in 2008."

Since the Fed has already printed massive amounts of money, the next crisis will be far bigger — and more dangerous, according to Faber.

"The next time we have a global economic crisis, it will be much worse than 2008. Before this happens there will be money printing and there will be war. The whole system will collapse," Faber says.

"That's why I'm advising people that they have to think it through. In a total collapse you don't want to own government bonds and cash."

Some say stock market sell offs are the result of the withdrawal of printed money from the Federal Reserve, which was artificially pumping up stock prices.

"A lot of pundits say there’s a lot of bad economic news, and there certainly is, but if you ask me, fundamentally, lack of printed money is doing it," financial guru Robert Wiedemer tells Newsmax.TV.

Wiedemer, best-selling author of "Aftershock," warns that the practice will likely be resumed and will ultimately bring on inflation.

http://www.moneynews.com/StreetTalk/Fab ... /id/406225