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Guest The_Oldie

Marc Faber Says Financial Markets In `final Stages Of A Bubble'

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IMO we will see some significant action to the downside by the end of Q2 of this year. Recent data suggests the shift began earlier, perhaps at the end of Q1. Negative HPI may start showing very soon as supply is growing exponentially. The panic is probably already underway.

Recession no longer likely IMO. It's a certainty.

I am 80% in cash and very short term bonds. The only question is: how long to hold onto the remaining shares?

And how many millions are thinking the same thing? The casino operatoir is asking the question: do you feel lucky?

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I listened to this yesterday, very interesting stuff. I like the comment about economists should learn how to drive tractors...probably a bit complicated for most of them though :lol:

I agree that we are in the last stage of the bubble in most asset markets. Residential property certainly has tipped over already (though not yet crashing) and commercial property is stagnating. The stock market takeover boom is in full swing, especially for 'media assets' that generate fairly poor cashflows, which reminds me a lot of the top of the dotcom bubble.

The other thing that says crash ahead is the amount of leverage in the system and the apparent willingness of lenders to lend at almost no risk premium. Its as if risk has gone away - we all know it hasn't.

I do not agree with buying farm land in the UK though as the alternative investment. Maybe its different in the US with farm land but here in the UK the liquidity that is sloshing around the system and the tax breaks on farm land has already attracted too much 'investment' money especially from Irish farmers who have sold up in Eire for building land. City bonus money that is looking for an IHT shelter has also pushed up prices of farm land. My Dad just sold out his farm to an City 'investor' and the cashflow from the farm is way below the cost of a 100% IO mortgage. I have another friend who bought an organic farm in Wales about ten years ago and he made his first (small) profit this year. I admit the value of the farm has gone up because of the residential value but as a business it is a rubbish proposition.

I am an economist and I can drive a tractor - I can say after 25 years of being away from it I know that I never want to go back. The money is terrible and the work too hard.

My investment stance for the last year has been to liqudate all my investment assets in an orderly fashion. Whenever I get offered more than fair value I sell and put the proceeds into very safe cash deposits as I beleive 'cash will be king' in the near future. Then I hope to buy back in for 20% or less of the price I just sold for in about five years from now. See the recent sale of Foxtons for an example of what I mean.

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Rumour has it they are posting more security guards round some of London's tallest buildings to prevent people jumping out of them like 1929. Funny enough it was the same shoeshine boy that told me this that I should get into property telling me it was a nobrainer, you can't loose.

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He recommends investing in "assets that are depressed", trouble is im having a hard time thinking of any, apart from the yen.

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still disagree about stocks being in a bubble - absolutely no justification behind it unless someone can convince me otherwise

having said that, if they do go then it will be quicker than before as hedge funds will short enything and everything - anyone feeling confident could open a cfd or spread betting account and benefit from the collapse

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Guest The_Oldie
He recommends investing in "assets that are depressed", trouble is im having a hard time thinking of any, apart from the yen.

I'm with "Wad" on this one, cash is king for me.

My investment stance for the last year has been to liqudate all my investment assets in an orderly fashion. Whenever I get offered more than fair value I sell and put the proceeds into very safe cash deposits as I beleive 'cash will be king' in the near future. Then I hope to buy back in for 20% or less of the price I just sold for in about five years from now. See the recent sale of Foxtons for an example of what I mean.

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Guest The_Oldie
Sterling? What currencies are we talking here, Swis Franc?

Not being a currency speculator, I'm holding the two that I want to spend. Aproximately 50/50 Sterling and Euro.

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Guest grumpy-old-man
Not being a currency speculator, I'm holding the two that I want to spend. Aproximately 50/50 Sterling and Euro.

£50 in both of those currencies will not get you very far Oldie, I think you need to keep on saving. ;)

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Recession no longer likely IMO. It's a certainty.

I am 80% in cash and very short term bonds. The only question is: how long to hold onto the remaining shares?

not sterling i assume ;)

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We sold most of our shares already..only left with some Gold and shares of Gold mining company's ;) also still have a couple shares of a dept company..they didn't do so well so I hang on a bit more..business will probably pick up later :lol:

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Guest The_Oldie
£50 in both of those currencies will not get you very far Oldie, I think you need to keep on saving. ;)

I am :lol:.

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