With all of the global unrest, struggling economies and crazy politicians, the world today is facing many similarities from the 1920s and 1930s, when communism and fascism became very popular worldwide, says Jim Rogers, the famous billionaire investor and bestselling author of “Hot Commodities.”
According to Rogers, the planet is “overdue” for a substantial crisis. As history has shown, there are many periods of “severe crisis,” unlike 2008, but rather a crisis of huge unemployment, the rise of dictators, world war and bankruptcies all over the place.
But here’s the bad news: The Swiss investor, who publishes the aptly namedGloom, Boom & Doom Report, sees the large-cap benchmark SPX, +0.04%shedding more than half its value, possibly over the next year.
“When it unravels, we are going to go to 1,100 on the S&P 500,” Faber told MarketWatch.
Faber said central banks“printing money” is a recipe for carnage that could result in “ five years of capital gains” being coughed up by the market. And if we give that back, “we’re around 1,100,” he said.
KORSCHENBROICH, Germany—Two years ago, the European Central Bank cut interest rates below zero to encourage people such as Heike Hofmann, who sells fruits and vegetables in this small city, to spend more.
When Ms. Hofmann heard the ECB was knocking rates below zero in June 2014, she considered it “madness” and promptly cut her spending, set aside more money and bought gold. “I now need to save more than before to have enough to retire,” says Ms. Hofmann, 54 years old.
Recent economic data show consumers are saving more in Germany and Japan, and in Denmark, Switzerland and Sweden, three non-eurozone countries with negative rates, savings are at their highest since 1995, the year the Organization for Economic Cooperation and Development started collecting data on those countries. Companies in Europe, the Middle East, Africa and Japan also are holding on to more cash.
DYI
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