Marc Faber Why Dubai Debt Default is Just the Tip of the Iceberg
Economics / Global Debt Crisis Dec 05, 2009 - 06:07 AM GMTBy: LewRockwell
Uber bear investor and Gloom, Boom and Doom Report editor Marc Faber says Dubai World’s debt problems are just the tip of the iceberg, and suggests investors will be better off not buying U.S. government bonds.
“In the context of all the default that will happen in the world, it (Dubai) is not a big thing,” Faber told Bloomberg. “But it’s a reminder that governments can default.”
The 3.3 percent investors currently earn on U.S. bonds will likely be lost to dollar depreciation over time, Faber notes. Moreover, if deflation occurs, “much more money will be printed” and stimulus packages will cause government debt to rise.
“Eventually, I suppose a lot of governments will be bust, including the U.S.,” Faber says. “Nothing has been resolved, it’s just being postponed…The ultimate crisis will not just bankrupt the banking system and financial as happened in 2008, it will bankrupt governments.”
“I think the upside potential for U.S. bonds is extremely limited.”
Copyright © 2009 Newsmax
© 2009 Copyright LewRockwell.com - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.
© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.
