MarcFaberTheGloomBoom&DoomReport

BarronsTheArtofSuccessfulInvestingConferenceOctober21,2013
TheFedisamassiveinterventionintothefreemarket
Somethingwillneedtobedonetounwindallofourdebt
o Richpeoplewillbeluckyiftheycankeep50%oftheirwealth
Thewealthofthebottom50%ofhouseholdsisstill44%belowits2007peak
o Wealthfrommoneyprintingdoesntflowevenlyandthisisthemostfundamental
sourceofincomeinequality
Taxesonthewealthyreallycantberaisedthatmuchmorewhenyoutakeintoaccountthe
salestaxesthatstateslevy
o Thehigherthesalestaxthegreatertheincentiveforblackmarketstodevelop
BelievesEuropeanstocksareattractive
o Specificallylikestelecom
o ENIinItaly
Japanisnotattractive
GoodChinesecompaniesareexpensive[agreeingwithDavidHerro]
o Chinaisnotactuallygrowingat8%likethegovernmentclaims
o Thegrowthisactuallyfundedbycreditandthiscreditisbeingspentinunproductive
wayssuchasintheChineserealestatebubble
TourisminAsiaisexplodingandwillgrowforalongtime
o Casinosareonewaytoplaythis,likeMacau
o AnotherwayisaircraftservicingcompanieslikeSATS,SIAEngineering,Singapore
TechnologiesIndustries
Possiblefoodshortagesatsomepoint
o PlaythisideathroughWilmarInternational(WIL)
CommoditypriceswillfacepressurebecauseoftheChineseslowdown
o WillaffectDiamlerandGermanstocks
Goldsentimentisverynegative
o Ithasalreadyhadabigcorrectionandwillreenterabullmarket
o Heisntextremelybullishbutwouldratherbelongthanshort
Chinesepresidentisnotasourceofreformation,heisanadmirerofMao
AllofAsiawillbecomeChinacentric
o 80%ofthePhilippinesisalreadyownedbytheChinese
o Theydontseemtowantanyspecificterritoriesbuttheireconomyisdependenton
commodityimports
Congressisabunchofthievesarguingoverhowtodividetheloot.
ThemoretheFedprintstheworseoffthelowerclasswillbe
Ingeneralstocksandbondsoffersimilarreturns[?]butatthemomentbondsprospective
returnsarepoorimplyingthatequityperformancemaybepooraswell
Risinginterestratesareaheadwindforcorporateprofits
AninterestingproblemwithAsiaisthattheirinfrastructureisconcentratedinafewcitieswhich
areextremelylargeandlikelyunabletogrowmuchmore.