U.S. Inflation to Approach Zimbabwe Level, Faber Says

[w¡n9Nµ7 §£@¥€r 123]

May 27 (Bloomberg) -- The U.S. economy will enter “hyperinflation” approaching the levels in Zimbabwe because the Federal Reserve will be reluctant to raise interest rates, investor Marc Faber said.

Prices may increase at rates “close to” Zimbabwe’s gains, Faber said in an interview with Bloomberg Television in Hong Kong. Zimbabwe’s inflation rate reached 231 million percent in July, the last annual rate published by the statistics office.

“I am 100 percent sure that the U.S. will go into hyperinflation,” Faber said.

http://bloomberg.com/apps/news?pid=2060108...&refer=home

[mawilson 2,133]

Faber is Dr Doom.

He predicted many things that have happened so far with almost 100% accuracy.

He's a VERY smart guy and FWIW, I agree with him.

The Fed is going keep printing money and buying treasuries to keep yields low.

The dollar will weaken, commodities - and therefore energy and food prices - will rise

(note that the Fed excludes food and energy from its core-inflation calculation, so they

don't give a ####### what you pay at the pump.)

[w¡n9Nµ7 §£@¥€r 123]

What do you do with your money assuming you believe this is what's coming? TIPS?

[Peikko 1,575]

Turn it into gold and bury it in the garden.

Alchemy will make a comeback - and we'll start burning witches.

[mawilson 2,133]

What do you do with your money assuming you believe this is what's coming? TIPS?

I'm more aggressive than that

At the moment, I'm long energy (mostly oil and gas) and short the dollar.

[w¡n9Nµ7 §£@¥€r 123]

cool

[Peikko 1,575]

Don't get over excited A.J, you might start to twitch!

[w¡n9Nµ7 §£@¥€r 123]

** you, MC.

[Peikko 1,575]

Thank you A.J, that's the nicest thing you've said to me all week

[NickD 203]

Turn it into gold and bury it in the garden.

Alchemy will make a comeback - and we'll start burning witches.

Was nice when gold backed up the US dollar and was 35 bucks an ounce. Trick today is to buy it when it's cheap and sell it when it's expensive, if you can find a buyer for it and you can get it cheap.

So what to invest our money in? Talk to my wife quite a bit, she always suggest real estate, are you kidding? The way property taxes are going, we would be cleaned out and never get our money back. Thinking more about buying paper clips, everybody needs paper clips.

What I really need is good suggestions, financial advisers tell me to leave it in a CD so at least the interest you earn and are taxed on offsets a small fraction of the inflation.

Other bad news is if this country does fall apart and since they control the deeds, that would be a worthless piece of paper. A guy with a bigger gun can take your property. Hey, that's it, will invest in guns! Really big guns!

[AlHayatZween 2]

Invest in Rosetta Stone Mandarin.

[scandal 951]

What do you do with your money assuming you believe this is what's coming? TIPS?

I'm more aggressive than that

At the moment, I'm long energy (mostly oil and gas) and short the dollar.

I like TIPS. iShares ETF is yielding 5.89% risk free, 90% inflation protected. What's not to like?

My morning newsletter is also suggesting longs on sector ETFs for countries that have strong domestic stimulus plans. In particular CAF - Morgan Stanley China Fund (as a trade, not a hold) and EWD - iShares Sweden.

Regarding USD - so much of current analysis is recommending short dollar positions that I'm starting to wonder if the smart contrarian play might not be to actually to go long?

[mawilson 2,133]

I like TIPS. iShares ETF is yielding 5.89% risk free, 90% inflation protected. What's not to like?

I don't dislike it.

My morning newsletter is also suggesting longs on sector ETFs for countries that have strong domestic stimulus plans. In particular CAF - Morgan Stanley China Fund (as a trade, not a hold) and EWD - iShares Sweden.

I'll take the opposite side of that. I don't believe in "stimuli" - you take money out of

the economy with one hand (via bond financing) and put it back with the other.

It's asinine. I'll bet against all countries that borrow or print money to stimulate their

economies.

China doesn't do that - a China ETF might be ok (a little overbought at this point.)

Regarding USD - so much of current analysis is recommending short dollar positions that I'm starting to wonder if the smart contrarian play might not be to actually to go long?

Perhaps, though they take their cues from the commodity (esp. oil) markets, so I'm inclined

to let it run a little while longer.

[The_Dude 1,142]

Faber is Dr Doom.

He predicted many things that have happened so far with almost 100% accuracy.

He's a VERY smart guy and FWIW, I agree with him.

The Fed is going keep printing money and buying treasuries to keep yields low.

The dollar will weaken, commodities - and therefore energy and food prices - will rise

(note that the Fed excludes food and energy from its core-inflation calculation, so they

don't give a ####### what you pay at the pump.)

The current calculation is antequated.

I do think it's going to get worse, but not hyperinflation bad.

[scandal 951]

My morning newsletter is also suggesting longs on sector ETFs for countries that have strong domestic stimulus plans. In particular CAF - Morgan Stanley China Fund (as a trade, not a hold) and EWD - iShares Sweden.

I'll take the opposite side of that. I don't believe in "stimuli" - you take money out of

the economy with one hand (via bond financing) and put it back with the other.

It's asinine. I'll bet against all countries that borrow or print money to stimulate their

economies.

China doesn't do that - a China ETF might be ok (a little overbought at this point.)

Why do you hate Sweden?

Seriously, here's the newsletter argument:

The country issued a large stimulus package to combat its economic downturn and the central bank has effectively used interest rate cuts to manage its economy. Sweden's sovereign debt holds a strong AAA rating despite Swedish banks being primary lenders to the Baltic states. We expect Sweden to benefit from export demand as global economies heat up.

Not to mention the fact that Swedish girls are hot