HAI: It’s been awfully quiet in Washington after a series of battles over the debt ceiling and the fiscal cliff in 2011 and 2012. Do you see any political risk lurking either in the U.S. or elsewhere?
Marc Faber: It’s a fair
assumption that the U.S. government debt will continue to increase. And
it’s also a fair assumption that the U.S. and other central banks around
the world will continue with the monetization of the debt.
To what extent there will be a battle in Congress between the
Republicans and the Democrats over the debt ceiling and about spending
cuts is anybody’s guess. But the facts are that the U.S. government debt
took 200 years to reach $1 trillion in 1980; we were at $5 trillion in
2000, and we’re now around $17 trillion. You can clearly see where the
And the deficit will actually start to
increase shortly a) because of the increase in interest rates; and b)
because more and more people are retiring, so the entitlement programs
will increase. I do not see the debt in the U.S. diminishing. The
question is, Will it increase by $1 trillion annually or $2 trillion;
Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.