Sunday, October 2, 2011

A Lehman Brothers event not likely in Asia

Marc Faber : There is, for sure. In 2008, the financial sector went bust. In the future, the governments will go bust. However, Asian governments’ finances are in a much better position than those of governments in the Western world, which have – aside from the published fiscal deficits, unfunded liabilities that are coming due. That will become a huge problem as the population is ageing, and fewer workers support more retirees. Asia reacted well to the 1997-98 crisis. A period of deleveraging followed: businessmen became conservative, they paid down debt. And banks became cautious in their lending. Asian banks are any day safer than banks in the Western world. I would deposit money in a Thai bank, no problem. They don’t know what a derivative is — because the derivative salesman was stuck in traffic in Bangkok! - in http://www.firstpost.com

Marc Faber recommendation for asset allocation

Marc Faber : Nobody knows what the world will look like in 10 years. I’m always asked ‘where will the markets go?’ But there’s so much intervention through monetary and fiscal policies that it’s hard to say. My advice is for investors to be diversified: 25 percent in Asian real estate; 25 percent in equities; 25 percent in cash; and 25 percent in gold. - in http://www.firstpost.com

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