- Satyam Chairman Arrested, Board Dismantled
- Democrats Recasting TARP As Their Own Stimulus Plan
- Treasurys Boosted by Dismal Employment Picture
- Many Jobs on Wall Street May Never Come Back
- Obama Uses Jobs Report to Push for Stimulus Plan
- Nationwide Inquiry on Bids for Municipal Bonds
- TARP Fund Isn't Being Used to Help Housing: Panel
- For BlackBerry, Obama’s Devotion Is Priceless
- Rising US Layoffs Signal Recession Is Worsening
- To The Victor, Goes No Spoils
- Calvin, Cars, California And Your Emails
- Options Tracker: Home Builders, Energy And Yahoo
- How Healthy Is The National Lacrosse League?
- A New and Fresh Start to Your Career Search
- See What People Are Saying About… Scathing TARP Criticism
- The “Real” Breakfast of Champions?
- Cramer's Dow Jones All-Stars
- Stock-Picking Through the Rubble
The sheer amount of money governments are pumping into the financial system will eventually lead to a very strong rally in beaten-down assets, investor Marc Faber said on CNBC Friday.
![]() |
Photo: Oliver P. Quillia for CNBC.com |
By and large asset markets are "terribly oversold" now, while investors are going overboard into the U.S. dollar and U.S. Treasurys, Faber, editor of the Gloom, Boom & Doom Report, told "Squawk Box Europe."
"What you could see in the next three months is a very strong rebound in asset markets, in equities, followed by a selloff in bonds and eventually a selloff in the dollar," he said.
Governments and central banks around the world are providing liquidity and that will eventually have an impact, Faber said.
And once the buying starts the rally is likely to be "stronger than people expect" given that financial institutions are sitting on so much cash, he added.
'Colossal Deflation'
"I think the intervention by the government in the past and at the present time has created more volatility, not less, and so right now we have deflation, we have colossal deflation in asset prices," he said, noting that equities alone have lost $30 trillion globally.
But "I assure you if you throw enough money at the system, eventually you can reflate, especially in the United States," Faber added.
Statistically a rebound should happen, but if it doesn't "the air is out" and the world faces an economy "worse than the depression of '29 to '32," he said.






