Marc Faber warns on US equities

US recession is coming within 6 months says noted contrarian investor

Marc Faber warns on US equities

Noted contrarian investor Marc Faber warned last week, that the US economy will probably enter into a recession within 6 months and that a serious stock market fall is imminent.

In a video interview with CNBC Trading Nation, Faber said: “We could very well be in a recession in the US within 6 months.” He also believes a huge correction in the US stock market could send stocks down much more than 20%.

The editor and publisher of the Gloom, Boom & Doom Report explained: “I don’t think the US economy is doing particularly well. One of the problems is affordability, and cost-of-living increases. For most households, the cost of living has gone up very substantially and so their spending power is limited. In addition to that if you look at tax revenues in the U.S., corporate tax as a percent of GDP is essentially flat. However, what has gone up a lot as a percent of GDP is individual taxes, so it has some negative impact on the economy.”

His views clearly chime with those of economist Professor Steve Keen on the prospects for the US stock markets.

Watch the Marc Faber interview below.

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Christopher Menon

Every Investor Editor Chris Menon is a financial journalist who has written regularly for national newspapers, magazines and websites about personal finance, with particular emphasis on investing.