Marc Faber: Stocks May Fall 40% or More
Renowned investor Marc Faber has made another dire prediction for the stock market: It may fall by as much as 40% or even more. “Dr Doom” Marc Faber, the author of “Gloom, Boom & Doom Report” said in an interview to CNBC TV that the stock market could see another ‘lurch’ higher, but then the investors may want to cash out and run for cover.
“We have had more than eight years of a bull market,” Marc Faber, the bearish investor, said. “The Nasdaq is being driven by very few stocks,” he said, adding that it “usually is not a particularly healthy sign from a technical point of view.” Further, March Faber said that the valuations are very high and there is a lot of volatility. “We have a lot of volatility, and when things start to go down they will go down a lot,” he said.
Earlier in April, Marc Faber had suggested investing into commodity-related stocks over financial assets given the low prices of commodities. However, in the interview to ET Now, Marc Faber had cautioned that each commodity has to be analysed separately. Global prices of most major commodities, including crude oil, are on a sustained fall since mid-2014, with the RJ CRB Commodity Total Return Index falling over 40% during the period. Oil prices are falling on rising US shale output and record inventories. Marc Faber had also pointed out to a positive outlook for copper, as he said that the shift to electric cars will increase demand for the metal.
Marc Faber had also said then that the outlook for India and emerging markets is far superior to that in the “rotten western democracies”. He had maintained even then that the US markets are very expensive. “The US is a highly-priced market – it’s now 54% of global market capitalisation,” Marc Faber had said then. He said that he would rather continue to invest in Indian markets. “As an investor, I would find ways to invest in India and in emerging markets in general over the next five years, 10 years or 20 years.” he had said, adding, “India is at a low valuation relatively to the US, and it would outperform the US for many years.”