Famed investor Marc Faber, known as Dr. Doom for his gloomy views, believes the U.S. markets are in the midst of a gigantic bubble and when the day of reckoning comes, investors will likely lose half of their money.
Concerns about elevated valuations in the U.S. have been mounting given the S&P 500 and DJIA double-digit gains since November on hopes that President Donald Trump’s presidency will usher in a more business-friendly climate.
Indeed, the euphoria that has gripped the market since the November presidential election has faded as Trump struggles to enact many of his promised policies. Yet, most analysts still believe the bullish market thesis remains intact.
He thinks consumption is relatively weak for this stage of the economic recovery and predicted that as financial-asset prices rise, wages will deflate and the U.S. economy will further weaken.
One of the first warnings signals that the market is shifting will be when volatility picks up. But even the lack of volatility has managed to perplex the Switzerland-based investor.
Faber, meanwhile, likes U.S. Treasuries, given they guarantee a “certain yield” and particularly given the near-zero interest rates in Japan and much of Europe.
Source: Bloomberg pro terminal
Jr Trader Ivan Ivanov
Read more:
25 Canada Square, Level 33, office 50, Canary Wharf London, E14 5LQ +44 20 3608 6256
World Financial Markets - 0700 17 600 Varchev Exchange - 0700 115 44
Varchev Finance Ltd is registered in the FCA (FINANCIAL CONDUCT AUTHORITY) with a passport in the United Kingdom: FCA, United Kingdom - registration number: 494 045, which allows provision of financial services in the United Kingdom.
Varchev Finance Ltd strictly comply with the statutes of the European directive MiFID (Markets in Financial Instruments). targeting increased efficiency, transparency and uniformity of financial instruments.
Varchev Finance Ltd is authorized and regulated by the Financial Supervision Commission - Sofia, Bulgaria: License number RG-03-02-05 / 15.03.2006
The information on this site is not intended for distribution or use by any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
Disclaimer:
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 63,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.