Marc Faber: "The System Is Very Vulnerable," Brace For A "General Asset Deflation"

Tyler Durden's picture

With global debts 30% higher than they were at the 2007 crisis peaks, enabled by the money printing of central banks, Marc Faber warns that the "asset inflation" of the last years is not reflective of the broad growth seen in the 70s. "The system is still very vulnerable," he warned as investors are exuberant over "hot new issues" just as they were in 2000 and fears "excessive speculation" means investors should brace for a "general asset deflation." Emerging markets are relatively cheap to the US and Europe, he notes, but it is too early; there is nothing to like about low treasury yields but they are good to offset risk. As the market soared recently, fewer and fewer stocks are making new highs and this internal weakness (lack of breadth) and the breakdown in so many 'loved' stocks says the drop is coming sooner rather than later...


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DirkDiggler11's picture

Boom, Doom, and Dud Report.

Eisenhorn's picture

"System to collapse under weight of Faber's Doom Porn."


I guess if you put enough rounds down range you will eventually hit something....

ACP's picture

As much as I like the guy, yeah. Seems like every time he speaks, there's another short squeeze.

mvsjcl's picture

I've been listening to this for five years now. What's another five years more. I'm patient. But it's cost me a lot so far., and I fear that the payback is merely whatever I can generate from within myself.


Who the fuck knows!

NoDebt's picture

Does this guy secretly work for Goldman Sachs?

Greenskeeper_Carl's picture

my timeline is long. id take some more gold and silver price deflation with a big smile on my face

macholatte's picture


Somebody please provide me with a link to a time when Faber said "buy stocks" anytime in the past 4 years, anytime since the bottom in 2009.

Maybe it's just me, but seems like he is always talking about the next crash.

What's Gartman doing?

CunnyFunt's picture

Faber has in the past few years consistently recommended certain asian stock issues.
He's entertaining and his analysis is good, but he underestimates the resources of tptb.

macholatte's picture



Asian stocks ...... right


S&P 500          7/09                 880     

                     5/14                 1878


NASDAQ        7/09                 1756

                    5/14                 4131


DOW               7/09                 8146

                     5/14                 16,533


shoulda bought those Asian stocks.....


CrashisOptimistic's picture

No one in the past 4 yrs should be buying anything but farmland, so in that way, he's right.

Tarshatha's picture

"No one in the past 4 yrs should be buying anything but farmland, so in that way, he's right."

And some silver to bury on that farmland. One, two combo!

Babalooee's picture

Well, let's see here. He said buy Total Oil at the low a few years ago, and Microsoft and Intel and Japan, that's right, he hit old Japan pretty much right on and Novagold, that was another. In fact, thinking about it here for a second, I've found it very benefical listening to that sing songy Swiss voice. 

Keyser's picture

Hmm, what happens when you have both asset and currency devaluation, hyper-deflation? 


agNau's picture

Mor currency printing?

Pig Circus's picture

Faber looks at reality so he is a Bear and the markets been a Bull so the commenters are taking him to task.

Meanwhile the Bulls have been claiming the Economy, Labor Markets, Capex, Corp Rev's and Earnings will increase.

None of that has been right but the market keeps grinding higher.

Who's the Hero and whose the Zero?

The prognosticator who would have stated it's all a fucking farce, the econ and labor market are and will remain in the shitter but the CB's will conterfit with reckless abandon so stay long is the hero. I just can find that person.

HaroldWang's picture


Al Huxley's picture

Bullshit Marc, the system is running better than ever - the economy might be fucked, but the system is fine.

intric8's picture

I think asshat deflation is more likely

Peter Pan's picture

The whole deflation/inflation debate is badly constructed.

What is of greater importance is what the average man can buy with his cuurent pay packet in terms of housing, food, education and medical.

DirkDiggler11's picture

Can't you just cut and paste the last 28 posts by Faber on ZH? I agree with his message, but I am fucking over hearing the same shit out of Faber and Rogers for about 5 years now. You know, timing does count for something in the markets ..... These two are like broken records.

intric8's picture

The dow has rallied over 10,000 points in 5 years

Edit: 6507.04 on march 9, 2009
16,543.08 at present

Peter Pan's picture

If your whole perspective is affected by the DOW JONES then I can appreciate your frustration but if you are struggling to keep your home, job and sanity then I think you can relate a little more to Faber and Co.

There is a great gulf between timing and the final destination and some choose this difference to make money in the short run and others use this time to prepare for a wipeout.

Therefore it might be wise to split your portfolio into two, the FABER version and the HAPPY DAYS version.

intric8's picture

Precisely, the fed has gifted asset infation to the wealthy in this 'recovery' and given the shaft to everyone else. The middle class is being ransacked through monetary inflation. More significant class warfare is on the way. See how bad things get if they roll out austerity.

agNau's picture

The Russians/Chinese are taking the toys from the children now, and placing them in time out. Much kicking and screaming from the time out zone, as resolution on many fronts including austerity is coming. The checks written were never payable.

Savyindallas's picture

Most of it is inflation. No real value. it's still due to crash. The dollar collapsing will assure it.

AGuy's picture

What do you want? Marc or Jim to say the crash begins tomorrow? At this point it not possible to make such a prediction as we have not yet neared the tipping point. It appears to me your become frustrated because nothing has happened yet and your blaming Marc and Jim because it hasn't happened yet. Marc and Jim can't cause the Market to correct, they can only call as they see it.

At this point we are in a slow grind phase were debt grows, unemployment rises, food and energy prices rise. Nothing will change until we get close to the tipping point. 

Crawdaddy's picture

For starters this guy who claims balls can name names. He sits back and pontificates about things we can see for ourselves but he never EVER name the people pulling the strings. He is a minion of the globalists. He probably drew the short straw to fluff Kissinger before this year's Owl worshiping ceremony down in the grove.

buzzsaw99's picture

When I was a little boy
And the Devil would call my name
I'd say "now who do ...
Who do you think you're fooling?"
I'm a consecrated boy
Singer in a Sunday choir
My mama loves, she loves me
She gets down on her knees and hugs me
She loves me like a rock
She rocks me like the rock of ages...

[/Paul Simon]

Me.Grimlock's picture

But my wife - she hits me. She hits me.

She hits me, hits me, hits me, hits me.

stormsailor's picture

yeah al,  it may one day end.  but it just keeps spinning,  everyday more outrageous than the day before, and i cannot claim to know when it will end any more than i know when jesus comes back to earth.


i have cut back my reading in the last few months,  i'm beginning to get nosebleeds from the illogical stress it places on my logic.

Tarshatha's picture

"illogical stress it places on my logic"

That's beautiful, thanks!

RacerX's picture

so how come he's not simulcasting from his home in Thailand? Bad reception?

falak pema's picture

he has been marshall lawd by the lord of the flies. 

kito's picture

oh please. enough already. faber just STFU!!!!

falak pema's picture

ZH has been bracing since 2009... But the Oligarchy has been QE racing at the same time.

Question is will the braces break or will the race end first.

Its now just a question of time and maybe the novelty of the situation is that deciding when the race ends does not depend on the Fed but on those "dirty ex-reds!" 

Funny how being color blind can get you all full of hubris to the point of singing : the sun will never set on our way of life! 

Crawdaddy's picture

FWIW, I imagine the world view of a Joe Sixpack, honest hard working German, early 1930's, is bracing for what he sees coming. He can't understand why his neighbors are idiots for supporting the obviously megalomaniac, sadistic Nazis but he feels powerless to change anything. He finds few people want to hear his warnings that this isn't right. “Can't you see what they tell you is a lie?” He waits for someone to stand up and put an end to the madness but it never happens, at least in his soon-to-be-short lifetime.

It is going to have to be a lot worse in the US before it gets as bad as it was then. And since today most in the US measures govt “evilness” against what they were taught about the Nazis, anything short of concentration camps and ovens can be explained away by the shadow govt corps running the media. Eventually, even that won't work but by then the veil will have been ripped and the truth laid bare.

So how bout them Steelers?

Goldilocks's picture

The way we were (3:32)


Stars On 45 - Stars On 45 (The Original Version) (4:47)

Stars on 45 - 70's disco mix (7:14)

Stars On 45 - part.II 70's & 80's (9:59)

onelight's picture

that cranks up the wayback machine...missed most of it, but this I remember and it seems appropriate now:

Dire Straits - Once Upon a Time in the West..

Crawdaddy's picture

Cool! That looks like the same set from Money for Nothing. Back when you could sing "that little faggot he's a millionaire" and not have it memory holed.

Bill of Rights's picture

In STAGFLATION, the driving engine is NOT demand, but rising costs.
What we face is governments are raising taxes and thus they are consuming a greater proportion of the economy. Raising the cost of government (taxes) REDUCES the disposable income and therefore we have rising costs, but declining growth because it is not a DEMAND led boom but COST driven inflation.


Elliptico's picture

Faber has never been wrong before!  OMG!!!!!

TooBearish's picture

yeah Mark all good BTFATH and u can make double ur money!

ShrNfr's picture

With all due respect, when was this guy right about as much as the time on his wristwatch. Yeah, listen to what he says, but for heaven's sake think for yourself.

naughtius maximus's picture

Why the bold parts? Its harder to read

orangegeek's picture

No shit Marc.  Wealth is concentrated.  Consumers are broke.  Few are spending.  Inventories are bloated.  Consumer debt is excessive.


Prices will fall hard.

AdvancingTime's picture

Inflation, deflation, maybe stagflation, what is next? The modern economy that has evolved over the last several decades is loaded with interwoven contracts reeking of contagion. If faith drops in these intangible "promises" and money suddenly flows into tangible goods seeking a safe haven inflation will soar. Never before has mankind diverted such a large percentage of wealth into intangible products or goods.  I contend this is the primary reason that inflation has not raised its ugly head or become a major economic issue. Like many of those who study the economy I worry about the massive debt being accumulated by governments and the rate that central banks have expanded the money supply.

The timetable on which economic events unfold is often quite uneven and this supports the possibility of an inflation scenario. A key issue being one of timing. If the price of gas jumps to $8 a gallon overnight do you buy gas and not make your car payment or stop driving the twenty miles to work? Answer, it could be months before your car is repossessed so you buy gas. It is important to remember that debts can go unpaid and promises be left unfilled. Is this possible and if so where would that leave us? Chaos and major disruption would result from such a scenario. As we have seen from the economic crisis of 2008 and following many other unsettling developments legal actions can continue to drag on for years.  More in the article below.


Faber, Eric Sprott on & on. Broken record yes but the day is coming. Everyone knows that. Stackers will get whats coming to them bitches... Watch & see...