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00am, Monday, November 12, 2012 At the Grand Hyatt Hotel HONG KONG
There are two ways to conquer and enslave a nation. One is by the sword. The other is by debt. John Adams
Marc Faber Limited Suite 801, The Workstation, 43 Lyndhurst Terrace Central, Hong Kong Tel: (852) 2801-5411 Fax: (852) 2845-9192 Email: faberdoom@yahoo.com
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Investment strategy in a rapidly changing and highly volatile economic, political and financial environment
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"If it were possible to take interest rates into negative territory I would be voting for that. Janet Yellen
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Source: N/A
Since 1790, the average interest rate on US Long-Term Treasuries has been 5%!
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There are two ways to conquer and enslave a nation. One is by the sword. The other is by debt. John Adams
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The overall level of debt makes no difference one persons liability is another persons asset. Paul Krugman
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The grand fight between central bank debt monetization and the natural order of economic cleansing is about to enter a deeper, darker circle of hell. Bill King, The King Report (July 2012)
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Source: www.whitehouse.gov
Great nations are never impoverished by private, though they sometimes are by public prodigality and misconduct. Adam Smith
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OFFICIAL US FISCAL DEFICIT AND CALCULATED ACCORDING TO STANDARD ACCOUNTING RULES (IN $ TRILLIONS)
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THE UNLIKELY FISCAL CLIFF: SIZE OF FEDERAL TAX INCREASES, 1968 2012
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We all know what to do, we just don't know how to get re-elected after we have done it. Jean- Claude Junker (Prime Minister Luxembourg)
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PERCENTAGE OF US POPULATION LIVING IN A HOUSEHOLD RECEIVING SOME GOVERNMENT BENEFIT, 1983 - 2012
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Little else is requisite to carry a state to the highest degree of opulence from the lowest barbarism, but peace, easy taxes and a tolerable administration of justice. Adam Smith www.gloomboomdoom.com
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GROWING WEALTH INEQUITY: THE GAP BETWEEN YOUNGER AND OLDER AMERICANS (MEDIAN NET WORTH IN 1984 AND IN 2009)
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Source: Board of Governors of Federal Reserve System, 2010, Economic Policy Institute
If all prices and incomes rose equally, no harm would be done to anyone. But the rise is not equal. Many lose and some gain. Irving Fisher www.gloomboomdoom.com
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INCREMENTAL DEMAND FROM CHINA AND EXPANSIONARY MONETARY POLICIES DROVE COMMODITY PRICES HIGHER
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CHINAS SHARE OF GLOBAL COMMODITY TRADE (NET IMPORT AS PERCENTAGE OF WORLD IMPORT), 1992 - 2012
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The first panacea for a mismanaged nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring permanent ruin. Ernest Hemingway
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Source: www.middlebury.edu
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Two Strategies
Equities Cash and Bonds Aggressively shifting from one asset class to another or Achieving safety through diversification
Real Estate
Gold
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"If all else fails, immortality can always be assured by spectacular error. John Kenneth Galbraith
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WILL US CORPORATE PROFITS DISAPPOINT? (AFTER-TAX PROFITS OF US CORPORATIONS AS A PERCENTAGE OF BUSINESS GDP, 1950 2011)
It has long been recognized, by the business world and by economists alike, that a period of rising prices acts as a stimulus to enterprise and is beneficial to business men. John Maynard Keynes
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PERCENTAGE OF US STOCKS WITH A DIVIDEND YIELD HIGHER THAN TEN-YEAR TREASURY NOTE YIELD, 2006 2012
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SELECTED EQUITIES IN GREECE, PORTUGAL, SPAIN, ITALY, AND FRANCE ARE INEXPENSIVE
We are continually faced with a series of great opportunities brilliantly disguised as insoluble problems. John W. Gardner
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Source: Acciones Y Valores De Mexico, SA; Marc Faber, The Great Money Illusion (Hong Kong, 1988)
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S&P 500 TRAILING 10-YEAR COMPOUND ANNUAL TOTAL RETURN, 1825 - 2011
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Inflation is like sin; every government denounces it and every government practices it. Frederick Leigh-Ross
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The growth in government economic activity has a positive effect on productivity growth when government expenditures are les s than 17 percent of GNP, but when government expenditures are greater than 17 percent of GNP this effect is negative. Maximum long-run productivity growth thus occurs when government expenditures are about half of their 1986 percentage.
Edgar Peden, Productivity in the United States and its Relationship to Government Activity: An Analysis of 57 years, 19291986 (Public Choice, vol. 69, 1991)
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There is no means of avoiding a final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as a result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.
Ludwig von Mises
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