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Monday, September 20, 2010

Gold Still Inexpensive Says Marc Faber

Speaking at a CLSA Investors’ Forum 2010 in Hong Kong recently, Marc Faber said he still sees gold prices as relatively inexpensive, even though record prices continue to be set.

Faber gave his reasoning as this, “Given all the unfunded liabilities and the money printing in the world and the size of the financial assets in the world, I don’t think we are in a bubble.”

He's definitely right. At this time these elements aren't close to being fully priced into the value of gold, and central banks and governments are drunk on spending and reckless in stimulus, as they're caught in their socialist schemes which can't be paid for.

Even though he still considers gold to be cheap, Faber does recommend a monthly investment rather than attempting to time the market or putting everything in at once.

He also suggests gold will go through some significant price swings and corrections while maintaining its upward climb. That means those with large, one-time investments could get slammed if their entry point is on the high end.

Bottom line is governments aren't going to quit attempting to pay for their socialist programs, and that guarantees quantitative easing and stimulus, along with the accompanying increase in gold prices.

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