Next Time The Value Of The Dollar Declines By 97% Won’t Take A 100 Years. I Think It Will Happen In 10-15 Years

The dollar, the terminal value of the dollar is precisely zero, the printing cost of bank note that is the intrinsic value of the dollar. But it will not move there right away. since the formation of the federal reserve, in 1913, the price of gold has gone up from USD 25/oz to over US 1400/oz.

In other words the value of a dollar bill has gone down by 97% in gold terms and it took more than a 100 years. Now the next time the value of the dollar declines by 97% won’t take a 100 years I think it will happen in 10-15 years.

Related: IShares Silver ETF (SLV), SPDR Gold ETF (GLD), PowerShares DB US Dollar Index Bullish (NYSE:UUP), PowerShares DB US Dollar Index Bearish (NYSE:UDN)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Look At The Dow Jones Index In Gold Terms

If you look at the Dow Jones in gold terms it peaked out in 1999, and is not down 84% in gold terms.

In other words you can’t measure any thing any more in dollars because the function of money is to be among others a store of value and also unit of account, but if you print and print and print, the function of store of value expires or is non existent, and the unit of account doesn’t work anymore.

So we need to take a new unit of account which is gold or silver and in those terms, the US economy has contracted massively since the year 2000 and the dollar has been very weak as well as the bond market and eh stock market in gold terms.

Related Tickers: SPDR Gold ETF (GLD), SPDR Dow Jones Industrial Average ETF (NYSE:DIA)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

US Stock Market Outlook

Usually what happens in the market, we have seasonal strength in January, then weakness in February, then strength in March-April and then weakness in May-June and then again a summer rally in July until early August.

So, we are moving into seasonally strong period. But unlike many strategists, I don’t think we are going to make a new high. I think the S&P or the overall market in the U.S. will close 2011 at about this level or lower not higher as every strategist is predicting. I think we have seen the highs for this year, let us put it this way. - CNBC TV-18

Tickers: SPDR S&P 500 ETF (NYSE:SPY), ProShares UltraShort S&P500 (ETF) (NYSE:SDS), iShares Russell 2000 Index (ETF) (NYSE:IWM), PowerShares QQQ Trust, Series 1 (ETF) (NASDAQ:QQQ), ProShares UltraShort QQQ (ETF) (Public, NYSE:QID), SPDR Dow Jones Industrial Average ETF (Public, NYSE:DIA), Apple Inc. (Public, NASDAQ:AAPL), General Electric Company (NYSE:GE), iShares MSCI Emerging Markets Indx (ETF) (NYSE:EEM), Financial Select Sector SPDR (ETF) (NYSE:XLF), Netflix (NFLX), Alcoa (AA)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

There Are Several Factors That Point To A Declining Dollar, But I Have To Say The Other Currencies Are Not Much Better

The US has essentially one advantage and that is they issue their governments debt in US dollars. In other words, they have no mismatch of assets and liabilities. So, that's imperative to printing money. When you read the notes and the speeches from Mr. Bernanke, it's very clear that he would rather take the weaker dollar, than to have domestic style deflation. So, I think that there are several factors that point to a declining dollar, but I have to say the other currencies are not much better. - in LewRockwell.com

Tickers: IShares Silver ETF (SLV), SPDR Gold ETF (GLD), PowerShares DB US Dollar Index Bearish (NYSE:UDN)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Economics Is A Very Complex System And Is Essentially Human Life And The Behavior Of Humans

I think we can't be overly dogmatic in economics because certain things may work for one system and other things may not work in another system and so forth. Economics is a very complex system and is essentially human life and the behavior of humans. So to build one theory around it is probably wrong. Sure I am leaning more to the Austrian school, particularly when it comes to debt cycles. But I have sympathy for the Keynesian approach if, and this is a big question, IF it is implemented properly.

In other words, the business cycles will lead to excursions of prosperity and during these excursions into prosperity the system should build up reserves. Then when the excursion in depressions occurs below the trend line, use these reserves. But the problem with Keynesian economics has been that in the excursions into depression the reserves were always used but were never accumulated in the periods of prosperity, and so you build up larger and larger government debt and print more money; that is the problem. It's the problem of democracy. - in Lew Rockwell.com

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Short And Long Term Outlook On US Treasuries

We have to distinguish the short term and the long term. I think about two months ago, I turned quite positive for US Treasuries.

But obviously long term, at less than 3 percent yield on a 10 year US Treasury, I don't see any value. I think that interest rates over time will be much higher because the fiscal deficit will stay very elevated or even increase and that will impair the ability of the government to pay the interest. If the ability to pay the interest is impaired, there's only one way out and that is for them to print money, and so eventually you will get higher interest rates. - in LewRockwell.com

Tickers: ProShares UltraShort 20+ Year Trea (ETF) (NYSE:TBT), iShares Barclays 20+ Yr Treas.Bond (ETF) (NYSE:TLT), iShares Lehman 7-10 Yr Treas. Bond (ETF) (NYSE:IEF)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

It Will Be Difficult To Make Money In The Next 10 Years

If someone today would receive a billion dollars, it will be quite difficult to make a lot of money in the next 10 years. I am not saying if he puts the whole billion in gold, maybe gold will go up or if he puts the whole billion in silver, silver will go up. It would be quite risky for an investor to put the billion in one asset. Even if he diversifies, I don't think he will make a lot of money. - in DailyBell

Tickers: SPDR Gold ETF (GLD), IShares Silver ETF (SLV)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

How To Define And Find Value

Well I think when we talk about value, there is value in the purchase of certain assets if they are depressed and neglected. I also suppose there is value in selling short if assets are way above what I would call an equilibrium price or way above the trend line price. So, value can be interpreted in many different ways. You cannot be too rigid. I don't think there is a clear-cut definition of what value is and each analyst has to decide for himself where he finds value.

In general, value will emerge when things look bad for a corporation or a country or an industry, because market prices will fluctuate more than the fundamentals. In other words, if you look at the price of gold and you look at gold shares, the gold shares will be more volatile than the gold price. Or look at the price of real estate; the price of real-estate related companies will overshoot and undershoot. Some unusual opportunities eventually arise, either on the short or on the long side. - in Lew Rockwell.com

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

The S&P 500 Has Made Its High For The Year

“I think we’ve seen the high for the year (on the S&P 500 Index)” - in Bloomberg TV

Tickers: ProShares UltraShort 20+ Year Trea (ETF) (TBT) iShares Barclays 20+ Yr Treas.Bond (ETF) (TLT) iShares Lehman 7-10 Yr Treas. Bond (ETF) (IEF), Powershares DB Base Metals Fund (ETF) (DBB), United States Oil Fund LP (ETF) (USO), ProShares UltraShort S&P500 (ETF) (SDS), SPDR S&P 500 ETF (SPY), iShares Russell 2000 Index (ETF) (IWM), ProShares UltraShort QQQ (ETF) (QID), SPDR Dow Jones Industrial Average ETF (DIA), iPath S&P 500 VIX Short-Term Futures ETN (NYSE:VXX), iShares MSCI Emerging Markets Indx (ETF) (EEM), PowerShares QQQ Trust, Series 1 (ETF) (QQQ)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Latest Bloomberg Video Interview, June 23

June 23 (Bloomberg) -- Marc Faber, publisher of the Gloom, Boom & Doom report, talks about his investment strategy and the outlook for global financial markets. Faber speaks with Rishaad Salamat on Bloomberg Television's "On the Move Asia." (Excerpt. Source: Bloomberg)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Gold & Silver Will Probably Go Down In The Next 3 Months Or So, But I Would Not Short Them

“I still like gold and silver. They will go down in the next three months or so, but I wouldn’t short them. And I keep on accumulating gold. - in Bloomberg TV, from Hong Kong

Tickers: SPDR Gold ETF (GLD), IShares Silver ETF (SLV), Hecla Mining (HL), Goldcorp (GG), Newmont Mining (NEM), Kinross Gold (KGC), Silver Wheaton (SLW), Barrick Gold (ABX), Novagold (NG)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Gold, Paper Money & Government`s Integrity

"Not to own gold is to trust the value of paper money and the government's integrity" - in BlanchardGold

Related: SPDR Gold ETF (GLD), IShares Silver ETF (SLV), Newmont Mining (NEM), Yamana Gold (AUY), Novagold (NG), Goldcorp (GG), Barrick Gold (ABX), Anglo Gold (AU), Kinross Gold (KGC), PowerShares DB US Dollar Index Bearish (NYSE:UDN)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

The Only Way Out Of A Default

The only way out of a default (either outright, or through inflation) is to impose a flat tax and cut government expenditures by 50%. But only a financial catastrophe would affect those cures - in Beacon Equity

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

The World Is Underweight Gold And Flooded With Dollars

The world is actually grossly underweight gold but flooded with US dollars. - in MoneyWeek

Tickers: SPDR Gold ETF (GLD), IShares Silver ETF (SLV), Newmont Mining (NEM), Yamana Gold (AUY), Novagold (NG), Goldcorp (GG), Barrick Gold (ABX), Anglo Gold (AU), Kinross Gold (KGC), PowerShares DB US Dollar Index Bearish (NYSE:UDN)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

America`s Debt Problem

America's debt problem hasn't gone away – it has just been switched from the private to the public sector. The only way to reduce public debt would be "to impose a flat tax and cut government expenditures by 50%". But only a disaster could make that happen. - in MoneyWeek

Tickers: ProShares UltraShort 20+ Year Trea (ETF) (TBT) iShares Barclays 20+ Yr Treas.Bond (ETF) (TLT) iShares Lehman 7-10 Yr Treas. Bond (ETF) (IEF)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Stagflation & War.

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Not To Own Gold Is To Trust The Value Of Paper Money

Not to own gold is to trust the value of paper money and the government's integrity.

No one in his right mind could trust the U.S. government any more. The government's economic statistics are distorted and there is no consensus on how to solve the budget crisis. So, yes, people should own some gold. It can correct by $100 or $200 an ounce, but you own it as an insurance policy. The world is grossly underweight gold. It is flooded with U.S. dollars. Investors might be bearish about the U.S. dollar, but international dollar reserves exceed $9 trillion. Compared to that, there is very little gold.

Tickers: SPDR Gold ETF (GLD), IShares Silver ETF (SLV), Newmont Mining (NEM), Yamana Gold (AUY), Novagold (NG), Goldcorp (GG), Barrick Gold (ABX), Anglo Gold (AU), Kinross Gold (KGC), PowerShares DB US Dollar Index Bearish (NYSE:UDN), CurrencyShares Euro Trust (Public, NYSE:FXE)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

The U.S. Needs To Cut Entitlement Spending Meaningfully

If you lived beyond your means by borrowing, you need a period of deleveraging. That has happened in the U.S. only in the corporate and household sectors. Private borrowing has been replaced by government borrowing, which means the overall level of debt hasn’t been reduced. That needs to happen. The U.S. needs to cut entitlement spending meaningfully. It would be best to impose a flat tax and cut government expenditures by 50%.” - in Barron`s Roundtable

Tickers: ProShares UltraShort 20+ Year Trea (ETF) (TBT) iShares Barclays 20+ Yr Treas.Bond (ETF) (TLT) iShares Lehman 7-10 Yr Treas. Bond (ETF) (IEF)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Over Time The U.S. Dollar Will Lose Its Purchasing Power

“Nobody wants to accept that budget cuts because everybody lives from that, so essentially the fiscal deficit will stay very large, and it will mean that over time the U.S. dollar will lose its purchasing power, more money will have to be printed, more quantity of easy measures will have to take place, and so forth.” - Beacon Equity

Tickers: SPDR Gold ETF (GLD), IShares Silver ETF (SLV)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Investing In Asian Promising Countries

Well there’s no such thing as a favorite investment. But I think I tend to invest in Asia in promising countries, in equities, in real estate, and I own precious metals, obviously. - in Seeking Alpha

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Real Estate Is Reasonably Cheap In The US

I think that real estate value in America is reasonably cheap, but I don’t think that it will go up a lot. - in InsiderMonkey

Tickers: Lennar Corp (LEN), DR Horton (DHI), KB Home (KBH), Toll Brothers (TOL)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Diversify Your Assets

My advice would be to diversify heavily and have money in other jurisdictions than the United States, in other assets than US assets. In say Asia, Asian equities, Asian real estate. And I would have some money in custody outside the USA, in Australia or in Singapore or in Hong Kong or in Switzerland and not have all my assets here in the United States. - in InsiderMonkey

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Global Growth Is Slowing, Bearish For Industrial Commodities

"Global growth is slowing, which means weaker demand and lower prices for industrial commodities." - in Commodity Online

Tickers: United States Oil Fund (USO), Powershares DB Base Metals Fund (ETF) (DBB)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Geopolitical Trends Which Will Lead To War

In other words, the more negative you are about the world and the geopolitical trends which will lead to war, the more likely it is that you will do better in equities than say in bonds and cash. - BusinessInsider

Tickers: ProShares UltraShort 20+ Year Trea (ETF) (TBT) iShares Barclays 20+ Yr Treas.Bond (ETF) (TLT) iShares Lehman 7-10 Yr Treas. Bond (ETF) (IEF), Powershares DB Base Metals Fund (ETF) (DBB), United States Oil Fund LP (ETF) (USO), ProShares UltraShort S&P500 (ETF) (SDS), SPDR S&P 500 ETF (SPY), iShares Russell 2000 Index (ETF) (IWM), ProShares UltraShort QQQ (ETF) (QID), SPDR Dow Jones Industrial Average ETF (DIA), iPath S&P 500 VIX Short-Term Futures ETN (NYSE:VXX), iShares MSCI Emerging Markets Indx (ETF) (EEM), PowerShares QQQ Trust, Series 1 (ETF) (QQQ)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Obama Is By Far One Of The Worst Presidents The US Has Had

He is by far one of the worst Presidents the US has had. I’m very upset that none of what he said he would do, mainly change, has actually occurred. So I think he’s certainly intellectually dishonest. And he’s probably made the geopolitical situation worse and also the economic situation worse. And he’s actually vote-buying through handing out money and through increased transfer payments. - in businessinsider.com

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

There`s No Such Thing As A Favorite Investment

Well there’s no such thing as a favorite investment. But I think I tend to invest in Asia in promising countries, in equities, in real estate, and I own precious metals, obviously. - businessinsider.com

Tickers: IShares Silver ETF (SLV), SPDR Gold ETF (GLD), Market Vectors Vietnam ETF. (NYSE:VNM)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Real Estate Or Equities Are Better Than Cash Or Government Bonds

Well the positive aspect of my negative view is essentially that you shouldn’t own cash and government bonds but you should be in assets like real estate or equities or precious metals or in commodities.

That is the positive view. In other words, the more negative you are about the world and the geopolitical trends which will lead to war, the more likely it is that you will do better in equities than say in bonds and cash. -in businessinsider.com

Tickers: ProShares UltraShort 20+ Year Trea (ETF) (TBT) iShares Barclays 20+ Yr Treas.Bond (ETF) (TLT) iShares Lehman 7-10 Yr Treas. Bond (ETF) (IEF), Powershares DB Base Metals Fund (ETF) (DBB), United States Oil Fund LP (ETF) (USO), ProShares UltraShort S&P500 (ETF) (SDS), SPDR S&P 500 ETF (SPY), iShares Russell 2000 Index (ETF) (IWM), ProShares UltraShort QQQ (ETF) (QID), SPDR Dow Jones Industrial Average ETF (DIA), iPath S&P 500 VIX Short-Term Futures ETN (NYSE:VXX), iShares MSCI Emerging Markets Indx (ETF) (EEM), PowerShares QQQ Trust, Series 1 (ETF) (QQQ)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

US Treasuries Outlook

"US Treasury Bonds Outlook : Dr. Marc Faber likes Treasuries for a trade. Says 10 year yields could fall to 2.5 percent during a stock market correction. Longer-term Faber hates Treasuries and dismisses Albert Edwards call for sub 2 percent yields for the 10 year." - in iStockAnalyst, a snapshop of the Gloom, Boom & Doom Newsletter

Tickers: ProShares UltraShort 20+ Year Trea (ETF) (TBT) iShares Barclays 20+ Yr Treas.Bond (ETF) (TLT) iShares Lehman 7-10 Yr Treas. Bond (ETF) (IEF)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Industrial Commodities Outlook

"Industrial Commodities Outlook - Stay away from industrial commodities. Global growth is slowing, which means weaker demand and lower prices." - a Gloom, Doom & Boom snapshop, in iStockAnalyst.com

Tickers: Powershares DB Base Metals Fund (ETF) (DBB), United States Oil Fund LP (ETF) (USO)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Stock Market Outlook

"Stock market outlook: Faber is still cautious on equities, believing that a more significant market correction is around the corner. However, shorts should beware because they are fighting the Federal Reserve. If you have to be in the market, stick to consumer staples like Altria Group Inc (MO), Johnson & Johnson (JNJ), Coca Cola (KO), Procter & Gamble (PG), etc.

For the ultimate contrarian investor, take a look at some select housing stocks (Toll Brother (TOL), Lennar Corp. (LEN), KB Home (KBH)), but only if you have a high risk tolerance." - a Gloom, Boom & Doom snapshot, in iStockAnalyst

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Mexico: A Growth Story

"According to Dr. Faber, Mexico, the thirteenth largest economy in the world, is largely misunderstood. Most investors seeking emerging market exposure focus on the BRIC countries. But as Faber points out, Mexico is one of the world's largest developing economies as measured by GDP. On a per capita basis, the Mexican economy is larger than China, India and Brazil.

It is true that our neighbors to the south are coming back from one of the country's worst recessions on record. Reports of upward revisions in growth could translate into the potential for a good long-term investment.

Dr. Faber seems to think so. He continues to be pleasantly surprised by how well the Mexican economy is doing and he thinks it will continue to outperform most emerging markets over the long-term.

His reasoning is as follows; ten years ago Mexican wage rates were 270 percent greater than China's. Now Mexico's wages are only 45 percent higher than China's, and they are trending lower. What this means is that over the next 5-10 years we could see Mexico take over the manufacturing prowess that China currently holds, particularly with Mexico's close proximity to the United States. In theory, as the Mexican wage rate trends lower in comparison to China's, Mexico will attract more manufacturing jobs - thereby growing its middle-class and its economy." - in SmallCapInvestor

Related: iShares MSCI Mexico (ETF) (NYSE:EWW)

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.

Dropping 1 Trillion Dollars

"If Ben Bernanke were here right now, he would drop 1 trillion dollars into this room" - in Ira Sohn Conference

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.