Faber on Asia, commodities and why US stocks could “easily drop 20-40%”

Faber made many useful observations in this interview this morning.

The U.S. stock market could “easily” drop 20 percent to 40 percent, closely followed contrarian Marc Faber said Wednesday—citing a host of factors including the growing list of companies trading below their 200-day moving average.

In recent days, “there were [also] more declining than advancing stocks, and the list of 12-month new lows was very high on Friday,” the publisher of The Gloom, Boom & Doom Report told CNBC’s “Squawk Box.”

“It shows you a lot of stocks are already declining.”

Faber said U.S. stocks are on the “high side” right now, despite Tuesday’s decline, and expectations are quite high, which can lead to big disappointments…

CNBC broke his appearance up into 3 segments of just over a minute each. Here is a direct video link to part 1.

Here is Part 2 and here is Part 3.

Faber doesn’t refer to Canada in this discussion, but his comments apply to the great white north in spades.  The Canadian stock market has been falling slowly over the past year, but presently remains dangerously overvalued on banks and REITS. The downside from here is easily as big (or bigger) as for the S&P 500.

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