Marc Faber Interview: Here is What Faber is Bullish About

Insider Monkey
Jun. 06, 2011

IM: So what advice would you give for the next election cycle?

Faber: I think he will be reelected because we have some kind of a tyranny of the masses. You have essentially more people getting handouts than large tax payers. And so they are huge voting block. Then you have the unions, also large voting block. And then you have the government officials. They don’t want to have cutbacks in government and be fired. They essentially are paid more than the private sector. So again a large voting block.

I think it is quite likely that he will be reelected. But that is the problem of the US. In maximum 2-4 years, he will be gone, but the big people who vote in the US will still be there. And I think that in today’s presentations many observers have expressed a view that it’s very difficult to cut entitlements. In other words, social security, Medicare, and Medicaid because nobody wants to do that.

Nobody wants to accept that because everybody lives from that, so essentially the fiscal deficit will stay very large, and it will mean that over time the US dollar will lose its purchasing power, more money will have to be printed, more quantity of easy measures will have to take place, and so forth.

And eventually, the children, your children will be affected by all this.

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