The Biggest Crisis in Our Lifetime?
Marc Faber, popularly known as Dr. Doom has predicted that the US stock markets could correct by as much as 30-40%. In an interview to CNBC last week, Marc Faber said, “ You don’t see it. I don’t see it and nobody sees it. That’s why people continue buying stocks. Yet something will happen one day.” Explaining what may cause the plummeting of stocks he said, “It may come from a credit event, or a disclosure of a major fraud or it may come because interest rates start to go up, although central banks remain on the dovish side. There are many small events that can trigger the decline.”
Explaining why he predicts an impending doom, Marc Faber said that even though corporate profits have been expanding and interest rates remain low in the United States, as opposed to 2009, the valuations are very high. “Hardly anywhere in the world valuations are low. Stocks, as well as bonds, are fully priced,” he pointed out.
Just last month, Jim Rogers, who co-founded the Quantum Fund alongside George Soros, predicted that the “biggest crisis in his lifetime” is less than a year away. In an interview to Kitco news, Jim Rogers said, “We could see the worst crash in my entire life pretty soon.” Jim Rogers went one step ahead to say that it would be ‘bizarre’ if there wasn’t a problem. “We’ve had economic problems in the US, in North America, every four years since the beginning of the republic, to say that we’re going to have a problem is not unusual,” Jim Rogers had told in the same interview to Kitco. Jim Rogers observed that the 2008 financial crisis was caused due to a rise in debt, and since then the debt has gone through the roof. In fact, Alberto Gallo of Algebris Investments, in a blog written in July this year noted that global debt levels have almost quadrupled, rising 276% in the last decade to $217 trillion.
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