Contrary to the mainstream narrative that the current level of inflation is transitory, central banks will be forced to continue money printing and inflation will get worse to the point where we see wage inflation.
“What I think will happen, and most people have not really considered, we will get wage inflation. For the first time since the late 1970’s, we will get accelerating wage inflation, and in some cases, quite dramatic. In some states, the minimum wage is $15. I could see that going up to $30 per hour very quickly. I don’t think inflation is ‘transitory’ (as the Fed proclaims). We will not have stagflation. We will have something worse. We will have rising prices and a depression in the standard of living of most people.”
Dr. Faber says the U.S. stock market is “overpriced and over-owned.”
He likes stocks in foreign countries, real estate “far outside the cities” and physical gold, silver and some cash. Faber also likes some crypto currency in one’s portfolio.
Dr. Faber is less worried about the economic picture and more worried about the rise of socialism and communism in the western world. Faber contends socialism destroys economies and liberty. Faber points out,
“I can tell you one feature of all the socialist countries I have visited in my life, and all of them had less freedom, less happiness than we have, and the standards of living were substantially, not a little bit, but substantially lower than they are in the free capitalistic world. . . . I am sorry to say that I think the western world has gone down a very dangerous path where essentially, through zero interest rates, everything is free. Then you get the unintended consequences.”
So, with inflation going up and the standard of living going down in the West, is the possibility of war going up? Faber says,
“Correct. I think once this Covid19 thing is over, the elite, the ones who make the money, will go to war. That is the last recipe to keep the population together.”
Will COVID ever really be over, or will we see variant after variant until the economic system comes apart?
