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“I Want To Be Diversified, I Want To Own Some Gold” - Faber

Veteran investor Marc Faber, author of The Gloom, Boom and Doom Report, reiterated the need for gold in a diversified portfolio when interviewed last week on CNBC. 

Faber, a resident of Thailand, is an advocate of gold storage in Singapore, and believes that a diversified portfolio will help protect against future market corrections which he believes are on the horizon.

Faber doesn’t see further new highs this year in the US equity markets, and thinks that there could be an S&P correction of between 10% and 30%. While admittedly Faber has been expecting a US stock market correction for some time now, his view is based on what he sees as weaker earnings from some US consumer bellwether companies. 

Additionally, on a technical level, Faber points to a lower participation rate of S&P stocks making new highs and more stocks making new lows. He looks for an acceleration of weakness in credit markets starting in the high yield (junk bond) market - which has already weakened - and continued weaker corporate earnings.

Asked for his view about gold, Faber commented on possible gold market manipulation and the need to diversify investment portfolios:

 “Basically, we’ve been in a correction since 2011, some informed observers they think that the market is manipulated, I don’t know.

But I have always argued, we don’t know how the world looks like in 5 years’ time, maybe the S&P is at 3000, but it could also be at 1500, we just don’t know.

There’s a lot of manipulation through fiscal and monetary policies.

Now, I want to be diversified, I want to own some gold, I want to own some shares, I own the most in Asia, and some in Europe because I think in Europe there’s still better value than in the US, and I own some bonds and cash and real estate. So, I hope that when the collapse happens, I’m only going to lose 50% of my money. “

Both the SGX’s upcoming partnership with Brinks in Singapore, and the CME’s upcoming  partnerships with Via Mat, Brinks and HKIA in Hong Kong, clearly illustrate the growing importance of secure precious metals vaulting services in these two critical financial centres in Asia.

As part of a diversified investment portfolio, secure precious metals storage in safe and stable jurisdictions such as Singapore and Hong Kong is essential for wealth protection in an increasingly volatile global financial system.

Faber on CNBC

'Gold Webinar - Your Questions & Answers'
on Today Sep 16, 2014 at 1300 EST