TD: Marc, what are your thoughts on the regional Asian conflicts going forward and how might that impact natural resources?
Marc Faber : Actually, my view is this; we wouldn’t have a conflict in Asia if there was no intervention by the U.S. The U.S. has a security pact with Japan and has military bases and naval basis all over Asia.
The Chinese economy is highly vulnerable to interruptions in the supply of metals and of oil, because 47% of global metals consumption is nowadays from China[i]. It’s up from 4% in 1990 and 10% in year 2000. So they have become a huge factor. For their industrial production, they need resources; they need iron ore from Australia, copper from Australia and elsewhere, and oil from the Middle East. That’s their only source of oil, the Middle East, compared to say the U.S. that can source oil from Canada, from Mexico and who have a rising domestic production.
So the Chinese are very concerned about interruptions of supplies and I think that over time, the Chinese will want to control the East and South China Sea. I do not think that they have any aggression plans, but the U.S. wouldn’t be particularly happy if the Chinese or the Russians had military bases in the Caribbean, in Mexico, in Canada and so forth. The Chinese cannot accept to be encircled by military bases by the U.S. in Central Asia, South East Asia, and North Asia. I think the tensions will actually increase over time. - in bullmarketthinking Click here to watch the full interview
Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.Dr. Doom also trades currencies and commodity futures like Gold and Oil.