Product Description

Renowned investment advisor Marc Faber sets out to find tomorrow s gold the outperforming asset classes of the future. Far from being a sensational reading of the runes, this book delves deep into the past, to chart how old investor trends developed and assess how new patterns might emerge.

Change is the thread. As Faber points out, the world is experiencing a transformation as great as Europe s late-15th Century golden age of discovery and the Industrial Revolution of the19th Century events that altered the commercial face of the Earth forever.

And from this dramatic landscape a world in which economic, social and political conditions are morphing at an alarming rate Faber identifies investment opportunities.

Asia s three-billion-strong population will have a profound effect on the world, writes Faber, cautioning that today s richest cities and clusters of wealth are unlikely to retain their exalted positions in the future.

Product Details

• Amazon Sales Rank: #77482 in Books
• Published on: 2008-05-09
• Original language: English
• Binding: Paperback
• 378 pages

About the Author
Dr Marc Faber is a contrarian. To be a good contrarian, you need to know what you are contrary about. It helps to be a world class economic historian, to have been a trader and managing director of Drexel Burnham Lambert when the firm was the junk bond king of Wall Street, to have lived in Hong Kong for a quarter of a century, and to have a contact book crammed with the home numbers of many of the movers and shakers in the financial world.

Famous for his approach to investing, Marc Faber does not run with the bulls or bait the bears but steers his own course through the maelstrom of international finance markets. In 1987 he warned his clients to cash out before Black Monday on Wall Street. He made them handsome profits by forecasting the burst in the Japanese Bubble in 1990. He correctly predicted the collapse in US gaming stocks in 1993; and he foresaw the Asia-Pacific financial crisis of 1997/98 and the resulting global volatility.

Customer Reviews

a persuasive contrarian view on investment
I read this over the Christmas holiday and came around to Marc Faber's way of thinking. In a nutshell, here is what I took away from the book: the fiscal/monetary authorities control how much money sloshes around the world but cannot control where it ends up. In the 1980's and 1990's, excess liquidity found its way into stock and bond markets, asset classes which began the bull market much out of favor (remember in 1980, oil & gas partnerships and gold bars were hot, stocks were 8x earnings and bonds yielded 14%?).

As we sit in early 2003, we still have lots of money sloshing around in global markets but he argues we are in a mirror-image situation to 1981: commodities are very cheap and stocks and bonds are expensive. The recent rally in the CRB, in gold, and possibly in real estate, are the "shots across the bow" for a long-term investor shift back to hard assets and commodities in general. Deflation is the fear du-jour but Faber argues that all three major economic blocks (US, Europe and Asia) are debasing their currencies for stimulative reasons, meaning that all currencies are likely to devalue against hard assets -- ie the price of gold, real estate, etc. will rise. The coming inflation (still maybe a year or more away due to weak economic growth) will be bad new for bonds. He does favor emerging market stocks based on their strong correlation with commodity prices.

I found the chapter on Kondratieff to be less-convincing and more muddled. However, Faber backs up his arguments with lots of interesting charts and facts and all-in-all makes a coherent and persuasive argument for an emerging markets/commodities long-term bull market.

There is a Whole World Out There
Two weeks ago I was sitting in the dentists chair. When he finished sticking his instruments in his mouth, we talked for a few minutes about the stock market. He expressed the common hope of the moment that the war in Iraq will make everything good again. When I told him why that wasn't likely to happen, he made the remark that there is so much "money on the sidelines" that it will have to go back into stocks eventually. He probably heard that from CNBC. "There is a whole world out there," I told him. Money can to go to China or Russia. It doesn't have to go into Cisco. I then told him to read this book.

American investors who were conditioned by the 1990's to buy and hold forever need a new way of thinking. They need to understand that financial markets move in cycles of boom and bust that provide real opportunities to make money. Faber teaches the reader to follow the money and to understand that we now live in a global economy. With a secular bear market in the United States, over the course of the next decade the best investment opportunities will likely be elsewhere in the world and in commodities such as gold and silver. This book will open their minds and in time will help them fatten their wallets.

Faber's book contains all kinds of little gems that are worth remembering. It also has several chapters that I found especially thought provoking and unique to investment literature. First is a valuable chapter on the cycle of emerging markets. Second is a discussion of the United States as an emerging market in the 19th century. His comparison of the US to emerging markets such as China, Russia, and Asia is thought provoking - a process of wild boom and busts swings is not unique to them, but was a large part of the history of the US in the 19th century. It seems to go hand in hand with rapid modernization.

His discussion of history and financial bubbles is a good introduction to the subject and one that will help US investors understand the last few years.

Read this book. It is worth your time and effort. A lot of meat in it. Will make you think. Investment professionals will benefit from it too. If you are a stock broker, this book is worth a whole year of sales promotion literature and analyst recos coming from upstairs. Learn something to actually help your customers. If you are fund manager learn to think big and follow the money.

a worthy, and sometimes compelling, read
faber and his "i know best" attitude (which you'll either appreciate, as i did, or grow weary of) decidedly spell out his vision of what will happen in the time to come re: asian development and capital flows; he tells you what to do (in so many words) and why the herd will be wrong. his historical analyses are quite useful (except the chapters on business cycles and kondratieff cycles, which i agree are muddy) and he lays out plenty of evidence to support his positions. i must say that while i'm not quite bought into the doom and gloom that he is known for, his cases are compelling, and if this leads the reader to take offsetting positions in investing to better hedge their portfolio, then it is well worth its weight in gold.

his style is quite casual, making an economics book (as this is precisely that) rather easy to digest.

to succinctly summarize, global capital flows (and their ever increasing supply) will eventually flow to china and asia proper to support their ever-increasing per capita income. resource plays are the best bet. also, in a more general sense, he states how $$ can be made by spotting how market inefficiencies result from misallocation of foreign direct investment.

a worthy read? definitely. but i refuse to support it fully when i know faber sits on the boards of select mining companies that are primarily engaged in asian development (ivanhoe mines); a conflict of interest? it certainly seems that way...but that doesn't make him wrong.