Marc Faber has been one of the most outspoken and well researched bears over the last couple of years. Predicting anything and everything from an outright collapse to a prolonged bear market. With that in mind, it appears that Mr. Faber has finally capitulated on his bearish stance….
“I’m an investor, and I invest,” he told CNBC. “Do I want to buy European sovereign bonds at a negative yield where I’m sure to lose some money — not a lot of money, but some money — or do I want to be in some blue chip stocks? If I take a 10-year view, I think I will make more money in blue chip stocks.”
Listen, being a bear in a bull market is one of the most difficult things out there. No matter how good your research is, you begin to question your sanity and everything else in between. I remember shorting sub-prime lenders in 2006 and then wondering how it was possible for them to still increase in value. For another 18 months. When they did finally collapse, in the summer of 2008, some of them went from $70-80 a share to penny stocks in a matter of weeks.
Point being, I believe Marc Faber is switching to the long side at the maximum pain threshold. He is tired of this bull market proving him wrong, he is tired of everyone in the financial media making fun of him and he is tired of losing money/opportunity. Yet, there is another way to look at this. When a bear like Marc Faber finally throws in the tower, it is highly probable that the market top almost there. If not there already.
