Comments on: Hyperbole watch, Bloomberg edition A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 By: Dan Fri, 29 May 2009 05:29:40 +0000 Felix you have not said why the US should not suffer hyperinflation. Is it because the “US is the best country in the world” or because they are a “Superpower”
or have they perhpas suspended the laws of nature where they can print with no consequences whatsoever? All you have done is through stones at Bloomberg and especially at Marc Faber. Shame on you and Reuters. What if Faber is right! Will you and Reuters executives apologize to people who follow your advise? You seem to be 100% sure of what you say at least Faber admits he might be wrong.

All Faber said was that if the US keeps printing, “than i can guarantee you the US will at some point in the future suffer hyperinflation, maybe not the at the same rate as Zimbabwe but close” This is what he said to bernie during the interview.

As many here have stated Faber is the only investor/economist out there who never speaks his book. He does not manage people’s money he has an exclusive fund of 300 million dollars and that’s it. When you and your kind where putting stories of how good things where Faber was warning people of the coming catastrophe. In the past 20 years Faber’s advise has always been spot on, while you and the Cramer’s of this world where having an orgy with Goldilocks and the bears.

By: RN Fri, 29 May 2009 01:15:57 +0000 Quite so, Felix.

Just ’cause Faber has smart things to say sometimes doesn’t mean it’s not correct to call him out when he goes totally insane, as he does here, for the reasons you point out.

By: Ed Thu, 28 May 2009 21:56:07 +0000 Felix, Yours is an analysis of objectivity in Journalism, so yes you are right that yes Hyperbole have been used by Mr Faber. But it did the job it made you and others sit up and take notice. We (and he) don’t really think we will see those sorts of inflation numbers and who knows what they will be (nor does Faber, that is why he used hyperbole) but he is using hyperbole to indicate they will be with no doubt (or little doubt) be intolerably high.

It is disappointing that your journalistic skill have not acknowledged this and focused on his key points
– the fed is wrong
– Inflation is on the way in a big way

without the sensationalisation and pomp surrounding it would be another page 53 story that nobody would pay attention to (not quite many watch Mr Faber closely). Sensationalisation is what you do to sell papers?

By: Marc Thu, 28 May 2009 12:31:55 +0000 There are still so many people that have blind faith in the Fed as if it is a religion. Bernanke’s economic theories have all been proven false, the defintion of insanity is to repeat a process in the same manner and expect the same results, the Fed is reapeating all the mistakes that it has in inflating the real estate bubble to begin with. The Fed will no longer be able to reign supreme. If the Fed raises rates consumption will fall off a cliff and gdp will contract, which will drive our export-based creditor nations closer and quicker to economic ruin, while an inflationary recession with rising nominal prices will be the only option in the end, there is no way the US is capable of paying of its debts. Much of the paper value of assets in the US is overvalued as proven by the recent bubbles.

By: Dave Thu, 28 May 2009 11:50:00 +0000 I’m with Felix on this one. I don’t care how smart Mark Faber is. That was clearly a ludicrous statement and if Bloomberg is going to quote him on that they have a duty to point out how spectacularly implausible his statement is. Is he suggesting the Fed would sit back and allow this to happen?

By: Derrick Thu, 28 May 2009 08:10:57 +0000 The issue is that the creditors of the US may start to default. Particularly the GCC nations that are suffering now with low oil prices and were hemorrhaging, Japan also has sever imbalances that had their day of reckoning delayed due to growing US exports in addition to the high savings rate that allowed for the quantative easing, with deflation instead of inflation. When our creditors sell US debt/dollars not by choice, but by necessity in order to prevent default it will greatly devalue the dollar. The chinese will write-off the US debt, though not by choice. This is not an unrealistic scenario considering that almost all of the mainstream economists did not forsee this crisis, and that this ponzi post bretton-woods economy is slowly coming to an end.

By: Anonymous Coward Thu, 28 May 2009 06:59:19 +0000 Umm. I think that the US’s debt is in US dollars. This means that hyperinflation will drive the size of US debt to zero (plus everyone’s mortgage, credit card debt etc.). Assuming that the hyperinflation works out smoothly, then prices will rise, salaries will follow, and assets like US denominated shares will rise too since the products of US companies, priced in US dollars, will seem cheap (so long as companies use the financial markets to hedge their commodity exposure). Overall, hyperinflation sounds like a great way for the US to get out of debt. So why is everyone worrying? The reason, because it isn’t going to happen. No one wants to see the money they lent the US disappear so they’ll all prop up the dollar. Hyperinflation in the dollar is a complete load of nonsense, and that’s the problem. The US debt is BIG and it’s going to stay that way for a while.

By: Chris G Thu, 28 May 2009 04:52:32 +0000 Hi Felix,

The person who said that the policymakers will recognize a problem and act accordingly is really smoking something special.

Faber is on TV a lot (often on Bloomberg) and I’m thinking he might have been trying to shock the viewer because the problem is serious. Since inflation is defined as an increase in the money supply, we already have inflation. When the price levels begin increasing strongly is when the global economy recovers and the panic move to USD fully reverses.

We got a little taste last year with oil rising as helicopter Ben dropped rates and forced our seniors with bank balances to earn 0.30% on their savings accounts to bail out loser homeowners. But that’s besides the point. Price increases will result from developing countries buying up the natural resources – fuels, metals, and food – and remember, even if Ben had the guts to raise rates to combat inflation (which he won’t – he needs to be reappointed), raising US lending rates won’t curtail Chinese, Malaysian, or Indian demand for fuels, metals, and food.

If you really want to check him out, Faber shared his picks with the last 2 or 3 Barrons roundtables in January (easily found online). he is not a dogmatic pessimist – he recommended buying Asian shares and is a long term bull on Asia and commodities. he has helped me make money for myself and my clients and avoid calamity – he knows how the world connects – he is such a student of the world beyond his classroom work.

Faber is trying to wake up the average person because the politicians won’t stop what’s coming. Too bad the average person’s understanding of economics won’t allow that.


By: Derek Au Thu, 28 May 2009 04:47:17 +0000 Marc Faber has pretty a good record, and it is hard to argue with his record.

There is perhaps some sensationalism on Bloomberg’s part. Marc however was half joking when he said inflation close to that of Zimbabwe’s and he certainly did not imply that this would happen anytime soon.

I’d refrain from passing judgement on Marc based on an article.

Judge for yourself, the video of the FULL interview is here: ideo&T=Faber%20Sees%20U.S.%20Inflation%2 0Approaching%20Zimbabwe%20Levels%20&clip SRC=mms:// fJ.kepSzo.asf

By: Onion Thu, 28 May 2009 03:51:45 +0000 When I read that piece on Bloomberg I couldn’t help but laugh. The problem isn’t just that it’s the he-says/she-says game but that they always try to make it sound credible and as a factual statement. Granted, Faber did make such a comment, but there’s no reason for a journalist to completely act unbiased and not show a little more direction in an article that is clearly a load of crap.

If that is in fact the direction of the US to come, then it would fall apart before it got to that step. Our people are not cowards, nor is the rest of the world. The US Dollar wouldn’t even get to such a point. Where’s our Mugabe scaring citizens?