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.

See here for our collection of rare historical economic data.

Posted Jun 23, 2011
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