Marc Faber and Jim Grant on Bloomberg
Marc Faber & Jim Grant appeared on Bloomberg TV today and yesterday (respectively). See below for the videos & summaries:
Summary of the Marc Faber Interview:
- Chinese fraud companies reveal that there has been a bubble.
- Locals are the ones who make money out of the China story.
- We’ve probably seen the high for this year.
- The Fed will wait before QE3 et al.
- Commodity bull market still in tact. Gold & Silver are still good – though they may go down now.
- To not own gold is to trust central bankers – which is something you should never do!
Summary of the Jim Grant Interview:
- The Fed has two remits (that of maximizing employment & that of keeping prices stable). This objective of levitating stock prices is new.
- What happens when these fake prices come down? QE3…
- The Fed is trying to ‘impose’ prosperity through its manipulation of money.
- Either the Fed owns the stock market, or the stock market owns the Fed.
- Deflation is the great point of confusion.
- MMMFs are taking quite ponderable risks in Europe for just a few basis points.
- This trend in MMMFs is one of the unintended consequences of the QEs.
- We have substituted the gold standard for a ‘PhD standard’.
- The difficulty with the Fed is that it is imposing false values on various markets.
- The difference today is that you’re not getting compensating for taking considerable risk.
- We don’t need PhDs at the Fed, but rather people with plain old bachelors degrees in the laws of unintended consequences.
- The enterprise of quantitative easing is that of monetary debasement.
- We are going to get QE3 because the Fed has no intellectual or theoretical grounds upon which to deny it.
- The Fed is now a prisoner of its own muddled thinking.
- The housing bubble was an unmeasured inflation problem that the Fed instigated.
Recommended: Charting the Federal Reserve's Assets - 1915 to 2012