Diversify With “Physical Precious Metals Stored Outside The U.S.” – Faber

GoldCore's picture

Diversify With “Physical Precious Metals Stored Outside The U.S.” – Faber

Dr Marc Faber, respected economic historian and author of the respected monthly newsletter, the ‘Gloom, Boom and Doom Report’, has warned that 2015 is set to be very volatile, urged international diversification and owning “physical precious metals stored outside the U.S.”

In another insightful and witty interview with Bloomberg Television’s In the Loop, with Betty Liu, Erik Schatzker and Brendan Greeley, the ever charming and affable Dr. Marc Faber reaffirmed his long-standing preference for investing in emerging eastern economies, his lack of faith in the dollar and advised Americans to own gold.

Faber fails to recommend a single U.S. stock in 2015 and when asked whether recent events in Greece were a buy or sell signal, Faber began by pointing out that persistent intervention by central banks into markets had made making predictions far more complicated.

Some commodities have soared in the last six months, wheat has doubled, while the price of oil and natural gas had collapsed indicating great volatility. Forecasters surveyed by Bloomberg had been consistently bearish on bonds for years, until this year since treasuries outperformed the S&P in 2014.

Hedge funds generally only generated returns of around 1%. In light of these discrepancies and central-bank induced distortions to the market, Faber emphasises the need for real diversification.

When asked whether he had maintained his “discipline” when oil prices crashed he surprised his interviewers by saying that he actually trades very little to avoid commissions and charges and he indicated that he was so broadly diversified that the oil crash had little impact on his portfolio.

He went on to warn regarding U.S. stocks. “Sentiment about stocks in the U.S. is much too bullish, much too optimistic” and suggested that U.S. ten-year treasury notes yielding 2.2% were the best of a bad lot given the abysmal returns being offered on the bonds of other developed economies.

Dr. Faber was then challenged on his forecasts from 2008 where he referred to the dollar as toilet paper and denounced quantitative easing.

“Now if we stuck with that view”, the interviewer asked, “where would we be today with the S&P 500 trading north of 2000 and ten year yields, as you pointed out at 220?”

Faber responded with a laugh “Yes, the toilet paper status is still ahead of us……for all paper currencies – not just the U.S. dollar.”

He then pointed out how he had advised owning Asian stocks in 2014 and in recent years and how the stock markets of emerging economies have substantially outperformed U.S. stocks in 2014. He cites China’s stock exchange up 45%, India up 25%, Thailand up 14%, Indonesia 18%, Philippines 21% and Pakistan up 40%.

He also draws attention to the fact that just being invested in U.S. stocks was not enough to guarantee decent returns:

“As of early December there was about as many stocks on the New York stock exchange that were down 10% as up 10% and as many stocks down 40% as there were up 40% so we have a huge diverging performance.”

When asked directly which U.S. equities he would own, “what specific companies would you own in the U.S.?” – he declined to give a single recommendation. Instead he signalled that Americans should be getting their wealth out of the U.S. and into gold stored abroad.

He sagely and pointedly added:

“I have to say that sentiment about precious metals is incredibly negative and all these “experts” are predicting the gold price to drop to $700. Well, understand, these are experts that never owned a single ounce of gold in their lives!”

“So they missed the five fold increase since 1999!”

“But they all know that the price of gold will go to $800, they write about it with a lot of authority.”

Dr. Faber is a long time proponent of owning physical gold. He has consistently urged people to act as their own central bank in acquiring bullion coins and bars as financial security and he believes that to store gold in Singapore is the safest way to own gold today.

Our recent investment advice webinar with Dr Faber can be seen here

The Bloomberg interview with Dr Faber can be watched here

MARKET UPDATE
Today’s AM fix was USD 1,199.25, EUR 986.55 and GBP 769.84 per ounce.
Yesterday’s AM fix was USD 1,186.50, EUR 976.54 and GBP 764.50 per ounce.

Spot gold climbed $15.00 or 1.27% to $1,198.80 per ounce yesterday and silver rose $0.50 or 3.17% to $16.27 per ounce.

Gold fell after overnight gains in Asia today as global equities fell as risk-averse sentiment returned to the market, triggering safe-haven gold buying.

Buying on quarter end and year end weakness has proved a profitable trade in recent years and traders and gold buyers looking to increase returns are positioning themselves for possible price increases again in January.

Get Breaking News and Updates On Gold Here

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TheGreatRecovery's picture

SILVER DOLLAR  Since the USA Constitution states "Congress shall coin the money", I would think it would be the patriotic duty of every USA Citizen to, at the very least, own ONE USA silver dollar.  If one keeps it in one's pocket, it might remind one that the true sovereign is always the MONEY, and if one has at least one Constitutional USA coin, then, even should all the rest of his Constitution be lawyered-away, one has that one remaining speck of sovereignty, and is therefore a Citizen, not a Serf.

Bangalore Torpedo's picture
Bangalore Torpedo (not verified) Dec 31, 2014 4:25 PM

I'll never understand the obsession with storing physical in another country.

gwar5's picture

If PMs are criminalized in Western economies, like they have been in the past, a local black market for PMs may not be enough.

 

If you really believe the Doomsday scenarios, secreting away a little PM by an average Joe in a small plot in Costa Rica, Chile, etc., might not be a bad way to hedge. Agreed, a condo with allocated vault space in Singapore, or a Hacienda in Paraguay, are ideas for the big guys who get to live in a fantasy dreamscape.

Clesthenes's picture

When you do learn, you'll still be right.

s2man's picture

That is advise for the same rich folk whom they advise to get multiple citizenships and passports.  Outa my league.

SnatchnGrab's picture

Hey, store your gold overseas! What could go wrong?

 

/signed 

 

Germany

Shitgum Suicide's picture
Shitgum Suicide (not verified) Dec 31, 2014 2:57 PM

I think when Dr. faber says store your gold outside the US he's talking about people who live abroad but who have assets within the CUS.
He wants HIS gold where HE'S going to be.

Get it. Got it. You'd better hope so.

Greenspazm's picture

Singapore facilities will be happy to store your 10 Eagles for you.

Clesthenes's picture

Marc Faber, “urged international diversification and owning “physical precious metals stored outside the US.”

This is really bad advice.

The federal government has encouraged Americans to send their money offshore for the last 30 years.

Why?  The reason is that dollars sent over seas are useless to recipients (companies, central banks et cetera).  And such recipients do not idly sit on bank checks or cash sent by Americans; they send such instruments (ultimately and quickly) to the FR Bank of NY for deposit in special accounts and then immediately convert them into the “world’s safest” investment, at least according to their wishful thinking.

In other words, dollars sent overseas come back almost immediately into US Treasuries: it is a fairly-well disguised method for subsidizing federal debt.

What’s next?  When the flow of dollars out of the country turns into a trickle back into the country, the Treasury will impose a tax on dollars returning.  Usually, this tax takes the form of outright seizure of dollars, OR GOLD – especially gold, on the pretext they are proceeds of drug dealing.  A seizure, you see, is more final, and difficult to overcome for the poor dupe who failed to account for this when he initially sent his funds to a foreign bank or institution.

The government is well-positioned to impose this tax (actually, it already has) and to deal with those who might protest.

You think it’s not likely here?  Then, why is the Department of Homeland Security modeled after the French committees of terror, the Judeo-Bolshevik Cheka and the Nazi Schutzstaffel?

What does the DHS plan to do with 2-3 billion rounds of ammo… an amount sufficient to wage an Iraqi War, at its highest rate, for 25 years?  Remember, so-called terrorists do not travel as armies; but, rather cells of 5-10… and the DHS needs 2-3 billion rounds of ammo for these tiny cells?  Try again.

Rest assured, your name is on a list, and when the DHS knocks your door down, it will be too late.

There is a better alternative: we have to duplicate what American Founders did, minus their mistakes. (Complete article)

 

Neglect these lessons of real history at your peril.

ombudsmanrules's picture

Not much the us.gov can do if you just move your dollars out of the US and you follow them to their new destination.   Permanently. 
I have no idea why anyone would want to live in the US anymore, considering how messed up the place is already and how much worse it's sure to get.

Clesthenes's picture

Wow, did you ever get suckered.  Can you name a country where the US DID NOT train and establish death squads to run it?  If you can, the country already had death squads, and the local tyranny was well-established.

If you send your money offshore, you lose it to CIA fronts; and, yes, it will be “permanently”; as in “elimination”.

 

Say, are you on the CIA payroll?

MrButtoMcFarty's picture

Sell the paper.

Buy the physical.

Shoot a bankster in the face.

Happy New Year!

wagthetails's picture

make sense, and anytime i want to see it, i simply hop on my private jet for a visit.  are you sure this isn't the same advertisment advice you see online "crazy brilliant way to quickly pay off your mortgage" 

Sukumvir's picture

Singspore can be invaded and crossed over in half an hour. It does not enjoy the same status Switzerland did during ww2.

 

 

 

tarabel's picture

 

 

Yes, I suggest that you buy specie and bullion and store it in my footlocker 5000 miles away from where you live, where I can guard it for you constantly.

And for those of you who do not trust me with this great responsibility, I have a large number of plots available in the back 40 where you can bury your gold and silver and nobody will ever find it. Except you, of course, since I have a set of GPS coordinates for you. Or I can bury it for you and promise to forget about where it is.

Clesthenes's picture

Quick, where do I sign up?

TheGreatRecovery's picture

DR. FABER knows how to diversify, IMHO.

Eagle Keeper's picture

If it's not where I can touch it then I don't own it....

quasimodo's picture

What exactly are you referring to there?

MedTechEntrepreneur's picture

Offshore storeage? Pftftftft.....

Citxmech's picture

Somebody else posted this earlier - but it's worth repeating:

If you don't hold it, you don't own it;

If you don't own it now, you may not be able to get it later; and

If you can't defend it, you may not own it for long.

Dragon HAwk's picture

I'm Rich  and I sleep well at Night.. that's all he had to Say...

Mark of Zerro's picture

Outside of the U.S.?  Ha!  Let's see...how about Ecuador?  Russia?  Colombia?  Bolivia?  Greece?  

Nope, what about INSIDE the U.S.   Inside like in the ground.  

 

Latitude25's picture

Mine's in Bolivia.  Great stable country.

Uncle Sugar's picture

I'll move my phys offshore right after I'm done loading up on bitcoin

Citxmech's picture

Yeah - that shit is dying a slow lingering death, eh?

Mad Muppet's picture

Let some bank in some land far, far away hold my phyzz? Oh, you so funny!

_underscore's picture

If it's so important WHY NOT AT LEAST TRY TO GET A PROPER MICROPHONE AND INTERNET/SKYPE/WHATEVER connection?

 

Do spare me this low rent mumbled crap.

 

 

disabledvet's picture

Especially one that neither produces any gold nor holds any as a reserve.

From what I've read Canada is still the best. Interesting that he doesn't say Switzerland.

Another stupendous year for dumb money...a simple S&P index fund monkey hammered pretty much everything. It's not like the surging dollar has led to a price collapse. Gasoline is lower.

Meh.

Gold looks good relative to default. Russian interest rates at 17%? How is that sustainable. Didn't know wheat prices had doubled.

Credit is being extended at ridiculously low rates. We already know price collapses in energy make for more volume...so you'll have to move that volume. Has Congress stopped spending?

KnuckleDragger-X's picture

As long as you remember where the boat sank, your good. As for storing in foreign countries, I don't trust my own government so why in the hell should I trust someone else's?

disabledvet's picture

Gold is money but it is not currency.

 

The only thing gold does is sit there.  That ironically is probably its greatest value...but if you're working on Wall Street you're not paid to do that.  Since bailouts and bubbles are the norm that's a lot of cash you're leaving on the table.

Is oil worth less now that it has lost half its value?  Still the same energy content, still the same global demand.  Who just sits on their oil?  And the answer of course is no one.

What kills demand is not the lack of gold but too much debt "and other obligations.". And thats what Wall Street makes that is everywhere and always in demand.  Just look at all the bailouts...