Dr Doom sees buying opportunity in European equities

Marc Faber, the investor who predicted the 1987 stock market crash, has gone on record saying he has been buying European equities this year, although also saying that the next few months could again see share prices fall.

Faber told CNBC Asia’s The Call programme that he had bought shares in Portugal, Spain, Italy and France in recent months, gaining from the market rally.

He said he was negative on the next few months, but that if share prices fell he would add to his positions.

Even in a worst case scenario for Europe, in which the euro collapsed and peripheral states such as Spain and Italy left the currency union, then there was an argument for holding equity assets. He said that investors in such countries would prefer equities to bank deposits if that happened.

For investors who are still worried about systemic collapse, he recommended holding physical gold. Even if the price fell by half, it would fall by less than other assets, leaving investors relatively better off.


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