Marc Faber: "Everything Is Going Up. Only At The Federal Reserve Is There No Inflation"

Tyler Durden's picture

Marc Faber was on CNBC earlier, once again discussing things so patently obvious only the Fed can not grasp them. Namely that as long as cheap money floods the system hard assets will continue rising in value, and gold will continue surging. Which is merely part of the bigger picture: nominal prices continue rising as real prices, denominated in paper and linen, continue to decline. But have no fear: Bernanke can fix everything in 15 minutes. Only that's total BS: "One day they will increase it by a quarter percent. But what does it mean when commodity prices are going through the roof, energy prices are going up, health care costs are going up, insurance premiums are going up?" Somehow, Bernanke believes, a hike will immediately undo months and years of downstream costs progressing through the system. And surely subprime is contained... As for the proverbial gold bubble: "If it were a bubble a lot of people would have gold. The whole world would be trading gold 24 hours a day. But I don't think it's really a bubble. I think gold is maybe cheaper today than it was in 1999, when it was $252." Oddly enough nobody mentions that gold is the only market that is now not part of the Fed's central planning "wealth effect" mandate (and the price suppression mandate is failing by the day): surging gold prices are an indication of one thing only: the market's desire to impose its own gold standard at a mark to market price equivalent for dollar destruction. It is this aspect of the metal: to correlate with Fed stupidity, that makes it such an attractive investment. And since Fed stupidity is endless, does it mean gold's fair value is infinite?

Also very enjoyable is the discussion of entitlement benefits beginning at the 7 minute mark.

Must watch.

Full clip (link).

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tallen's picture

Finally some sense over the Tube! Lets have more of this on the Ministry of Truth!

66Sexy's picture

We havent even seen the street level panic yet.

This is the 'smart money' buying now; most folks are busy checking their facebook and wondering WTF as gas prices soar.

It aint sunk in yet... when it does, and they start seeing that this is a revaluation downward of the dollar, we'll see where the money goes.

It is top-bottom asset acquisition now; once the street gets wind, they will be priced out of precious metals, or they simply wont know where to get them, or cant.

Plenty of other crap they can buy, that some form of worthless plastic.

hedgeless_horseman's picture

I put little faith in technicals, and am certainly no chartist.  Nevertheless, I do have access to a ruler, and the monthly of the dollar index has dropped below its rising channel, and support looks to be well below 70. 

Eeesh. 

SheepDog-One's picture

Those wondering 'WTF' as gas and food prices soar are the same ones writting their snide little giggling comments for 2 years on my Youtube and Facebook videos that gas and food will soon soar. So fek em.

ForWhomTheTollBuilds's picture

This is a very elitist, borderline fascist thing to say, but over the last few years I've come to the conclusion that the masses are simply incapable of understanding whats happening.  When you say the words "Crackup boom" to the people on this board, they can hold that idea in their heads and whether they agree with it or not it's as real to us as the word "chair" is to the masses.  But it doesn't work the other way around.

 

For most people "reality" is what they see and what they hear from other people (including the media).  Ideas are just not a relevant force in the average person's life.

 

I remember during the crash of 07/08 I wanted to feel like a smug housing bubble blogger laughing at all the idiots getting what they deserved and sometimes I did laugh.  But I realized that so many of them *still* didn't understand what was happening.  They weren't laughing at us in 05 because they heard our ideas and disagreed, they could never have understood then or now.  It's like trying to get get a dog to understand music.

 

I suspect as this drags on, I'm going to start feeling very bad for the masses again.  I just won't tell them that Im the one that has the gold I guess.

Hedge Jobs's picture

"We haven't even seen the street level panic yet"

if you are talking about wall street then no, if you are talking about main street what are you expecting to see? the people on the "street level" aren't going to panic. they dont have assets they can move offshore, they don't have trust accounts, they don't have vast amounts of cash they can move into commodities. They can't take evasive action even if they wanted to. They are living hand to mouth, pay cheque to pay cheque. What can they do when they realise that their living standards are dropping through the floor? absolutely nothing is the answer, so why would they panic? They wont panic they will just get miserable, thats why they call it a depression because thats how it makes most people feel. if you are in position to protect some of your wealth and you family then great, but most people arent.

 

 

Temporalist's picture

They could get smart.  They could care about the real situation of things and not keep asking for handouts because it doesn't take a genius to understand money doesn't grow on trees no matter what the bankers tell you.  They could realize that the two parties in the U.S. are one in the same and are not there to benefit the little guy but to enrich the already rich and their method is to make it seem as though there is an American dream still and that everyone is entitled to their fair share but that same share is dwindling and they see it all the time but continue to buy into "hope and change" catchprhases and charisma instead of sound, consistent, knowledgeable voices saying there is a cliff in the distance and the solution to avoid it is not to step harder on the gas pedal.

People aren't dumb they are lazy to learn about what's happening.  At least one good sign is that Glenn Beck, Fox, MSNBC and CNN are losing market share to real news, alternative news, on the internet.

People have had a choice and their choices are what got them here.  They voted in war mongerers, kleptocrats, inexperienced failures, oligarchs, charlatans, political dynasties, sycophants, intelectual-elites...

I am a firm believer in people get what they ask for most of the time.  People...you asked for it.  Unfotunately, as goes any Faustian Bargain, what you get in the end is not what you expected.

tomster0126's picture

Well said...this brings up the need for better finance education in American classrooms, starting as early as middle school.  I remember as a student i learned virtually nothing of the financial system until late high school, and then only in college as a Finance major did I actually get some real knowledge (which was still pretty deficient in general).  Most people don't have the skills or resources we do; they need our help.  It's easy to say that they should just learn all of this themselves like we did, but easier said than done.

 

www.forecastfortomorrow.com

tellsometruth's picture

You want the truth? You can't handle the truth!hahah sarc obvi! I will spam this again cause I have not had 1 "at a boy" for this or "well done" or nothing, and to be honest I would never have had the knowledge or balls/guts/gumption to do this with out ZEROHEDGE.COM. I can be heard asking Thomas Hoenig at the London School of Economics lecture about gold/silver, Bart Chilton, Andrew MGuire, PD manipulation for Central Banks, and the Constituition. Am I trying to get some attention, yes obivously, but I want it from the forum that inspired me to ACT! I know there are plenty of cynics here that can disount the effectiveness of such tactics, but look at Accorn caught on tape, how did that turn out? I will not use violence property destruction ("day of rage")as a tactic as so many pissed off youths here in London have resulted to as I think it detracts from the debate that is needed. So again I will post this:

 

 

TYLER,

http://www.lse.ac.uk/resources/podcasts/publicLecturesAndEvents.htm

download the mp3 of The Economic Outlook and Financial Industry Challenges
Speaker: Thomas M Hoenig
Chair: Dr Philippa Malmgren
This event was recorded on 30 March 2011 in Sheikh Zayed Theatre, New Academic Building

 

I ask Mr Hoenig about market manipulation of PM markets at the 55.30 mark!!! And I shook his hand afterward... this is what we need real debate and discussion, peacefully and see if can change the BS that has been going on.

 

please circulate or call me a dumbass I do not care I will stay my course, but I want more free open questioning and debate

akak's picture

What is a "junk bra"?

Would that be like a brassiere for Christine Romer?

Womb Service's picture

Nice work. I loved the idiotic nervous laughter response. "I didn't follow your question all the way through..." I could hear you clearly. What was his fucking problem?

 

You're pissing in the wind. Protect yourself and watch this house of shit collapse. Things are rapidly accelerating to the downside.

tellsometruth's picture

Thank you for taking the time to download and listen, I thought the nervous laughter was great and they way that he defended that it is more than just Utah that agrees with me (Virgina just needs Gov signature)...I might be pissing in the wind, but it was exhilirating to ask that provactive of a question...

Forensic's picture

Brandon

 

I was there at the LSE the other week and thought you dealt a killer Question to Hoenig.

I emailed details of this to Tyler, plus GATA, but neither seemed to bite.

I salute your non-violence resistance.

 

tellsometruth's picture

Forensic,

Thanks for nod on your website as well, looked around your site briefly and liked what I saw

 

Temporalist's picture

Faber is one of if not the best.  I'd clone him and make a mini-me out of him if I could...and Jim Rogers because tiny bowties are super cool.

baby_BLYTHE's picture

agreed!

Marc Faber (greatest economist in the world) Vs. Benjamin S. Bernanke (worst economist in the world).

That I would sell an ounce of my gold to see!

As to mini-me, how about this:

http://i54.tinypic.com/nvcv9d.jpg

Zero Govt's picture

we're all turning into Fabers, Rogers, Schiffs and Jim Sinclairs

it's not that Bernank is a crap economist, he's not anything but a crone. He does his masters/WS's bidding like a souless, unprinicipled sheep dip... and will go down with the bankrupt ship he's on lying to the bitter end to keep his team 'afloat' ...he's doomed like the other members of Club Parasite  

overmedicatedundersexed's picture

who stuck that pickle in becky's mush..why we would have massive unemployment with out QE..whadda think we got now bitch.

the not so mighty maximiza's picture

I don't think that was a pickle, Critical thinking and Becky Quick don't go together.

Cognitive Dissonance's picture

I don't think that was a pickle, Critical thinking and Becky Quick don't go together.

Fixed it for you. No charge. :>)

SheepDog-One's picture

Yea how did Becky Quick suddenly become an economic expert? I remember a few years ago she was just the mildly and somewhat disturbingly kinda cute but lazy-eyed chick on the early morning crew who didnt say much of anything at all. 

Vergeltung's picture

good description. I am surprised she didn't blurt out something inane about "alternative energy" as she is wont to do.....

wisefool's picture

Last week she had a couple of days off and they put Michelle C (squared) in there, and it was a much better mix. Becky just nods and says "yup" like the fat guy in the king of the hill crew. C2 is more like Boonhour. Joe had to keep challenging everything she said, even though she was still reading exactly from the CNBC/Keynesain script as directed.

RealitiveMind's picture

That "fat guy" has a name, it's Bill.  How you could be so disrespectful to a man, (albeit a one dimensional cartoon man), by comparing him to sleepy eyed Becky dim-wit, is beyond me.

wisefool's picture

I appologize. And you are right. the character Bill is very genuine and honest. I was only speaking to the aspect that he just generally affirms what the others are saying like a metronome sitting on top a player piano.

Chuck Walla's picture

Perhaps it is Warren's Pickle Becky dreams of? Kind of the Anna Nicole of finance maybe?

cossack55's picture

When does the BOOM begin?

Horatio Beanblower's picture


“The course of a progressing inflation is this: At the beginning the inflow of additional money makes the prices of some commodities and services rise; other prices rise later. The price rise affects the various commodities and services, as has been shown, at different dates and to a different extent.

This first stage of the inflationary process may last for many years. While it lasts, the prices of many goods and services are not yet adjusted to the altered money relation. There are still people in the country who have not yet become aware of the fact that they are confronted with a price revolution which will finally result in a considerable rise of all prices, although the extent of this rise will not be the same in the various commodities and services. These people still believe that prices one day will drop. Waiting for this day, they restrict their purchases and concomitantly increase their cash holdings. As long as such ideas are still held by public opinion, it is not yet too late for the government to abandon its inflationary policy.

But then finally the masses wake up. They become suddenly aware of the fact that inflation is a deliberate policy and will go on endlessly. A breakdown occurs. The crack-up boom appears. Everybody is anxious to swap his money against "real" goods, no matter whether he needs them or not, no matter how much money he has to pay for them. Within a very short time, within a few weeks or even days, the things which were used as money are no longer used as media of exchange. They become scrap paper. Nobody wants to give away anything against them.

It was this that happened with the Continental Currency in America in 1781, with the French Mandats Territoriaux in 1796, and with the German Markin 1923. It will happen again whenever the same conditions appear. If a thing has to be used as a medium of exchange, public opinion must not believe that the quantity of this thing will increase beyond all bounds. Inflation is a policy that cannot last.”

 

- Ludwig Von Mises

RealitiveMind's picture

So I am just waking up, literally, having a cup of mud, laughing at the Becky Quick comments, when I arrive at Senor Beanblower's comment.

I am thinking, FINALLY, somebody gets it!  Very concise, nailed it.  Then I scroll down, like the dope I am, and thud, I get Ludwigged.  I wonder if his books will be banned . . . .

Head for the Hills's picture

What about the breaking action of debt?  As long as there are people in debt, who are still willing to repay, this will delay the fall.  Even the very smallest peice of hardwood provides much more BTUs than a stack of hundred dollar bills, so no money will burn until all the debt (that people are still indending to pay) is gone and people are no longer willing to trade good sticks for cash.

tellsometruth's picture

"They become suddenly aware of the fact that inflation is a deliberate policy"

 

word to your mother

RealitiveMind's picture

The keystone of the entire program? The Fed has a 100 year charter that is coming to an end soon.  The only way you could upgrade from having control of the most properous country in history would be to have control of the entire world.  Global currency anyone?

Man, I would love to be a busboy at Bretton Woods right now . . . "Mr. Soros, I will give you St. Charles Place and the Reading Railroad for Atlantic Avenue, and my right arm", deal? 

The answer lies in The Creature From Jekyll Island.

For those who are reading averse, you can watch the lecture series on YouTube.  If after, it still doesn't make sense, resume trips to Abercrombie and Fitch to improve self-image.


falak pema's picture

when doom ends...we are not even into it yet...

LoneStarHog's picture

And now the opposing view from Mr. Denninger and the Kool-Aid crowd at The Market Ticker, where U.S. Pesos are hoarded in anticipation of purchasing real estate "at the bottom".

Rogerwilco's picture

I'm not a KD fan, but if you think the Fed and Treasury are going to let you realize "windfall" gains from your "terrorist" PM "hoarding" activities, you've got a platinum screw loose.

What's that? Your plan is to outlive the beast and prosper in the Mad Max world that follows? LOL!

The end game will be ugly for all participants, unless of course your name is Immelt or such and your GIV is fueled and ready 24/7.

GoinFawr's picture

Hunh, what's your definition of "windfall"? 'Cuz by some standards, the gold "hoarders" you speak of might already be there... though I doubt they can be labelled "terrorists", except by duped and losing paperbugs who are chagrined because they scorned the sage advice of the golden boys over the last decade, of course. And the world hasn't gone entirely "Mad Max" yet either, go figure.

Maybe your deck is a few 'paper' cards short? Or did you just go all in ZSL with Saxxon awhile back?

If so: my condolences.

Rogerwilco's picture

My definition of windfall doesn't matter. If it suits their purpose, PM owners will eventually be vilified and marginalized. They will be labeled as domestic terrorists and your neighbors will be asked to do their civic duty and turn you in. The forfeiture machinery is already in place, all it needs is some muscle and a couple of legal precedents. The recent conviction of the guy minting silver coins and the subsequent confiscation is only the first step.

BTW I own some PMs, but I have no illusions about realizing any monetary gains from them. They are an emergency stash and that's all.

GoinFawr's picture

`...eventually be vilified and marginalized.`?

Heh, where you been the last ten years? Goldbugs have been labelled all sorts, day in day out the whole decade, and realized real monetary gains all the way, even if all they were doing was trying to protect their purchasing power.

Now THAT was a `windfall` by anybody`s standard; see how this works? Kinda contradicts your point.

As for the rest: sure, maybe in the US, yeah. The `I was convicted because I am Not(die)haus` case is interesting. It was my understanding that he attempted to deceive people into thinking that his coins were actually Fed issued, which in a legal context is very different from merely offering a competing currency, though admittedly the judge`s words seemed to imply much more than that... then again all this is behind your own screen door anyway; the world is a much larger place, honest.

aphlaque_duck's picture

‎"Attempts to undermine the legitimate currency of this country are simply a unique form of domestic terrorism," U.S. Attorney Anne Tompkins said in a statement after von NotHaus was convicted.

GoinFawr's picture

Right. So in your opinion anything Anne Tompkins says is inviolable?

At the risk of making a Gold Leaf distinction 'Compete' doesn't necessarily equal 'undermine'. And in the context of the case I believe it was brought forward that Nothaus was attempting to deceive holders of his coins into thinking they were Fed issued legal tender, not merely another competing currency. Of which there are many.

alexwest's picture

#And since Fed stupidity is endless, does it mean gold's fair value is #infinite

yep
how to spot gold idiot.. its who says gold will be that or this..
not a chance..

price of gold is secondary.. size of money printing is primary...

alx

THE DORK OF CORK's picture

The damage has been done over a period of decades - the printing now is only a realisation of these credit money malinvestments and is the only honest alternative if you decide not to default on term accounts and bank bonds in banks which themselves were created my bank credit.

The Goverment money must replace credit money if you want the system to flow - the central deception is the initially small balance sheet of CBs with respect to the overall M3 which gives a artificially large value to the transactional currency.

The yield chasing game is coming to a end for perhaps the remaining decade - the system is recapitalizing.