by Nuri Vittachi
John Wiley & Sons
ISBN: 0471832057
Book Description
First-hand information about Dr. Doom's financial predictions for the millennium. Dr. Marc Faber, a.k.a. Dr. Doom, offers here his financial ideas, theories, and predictions for the forthcoming millennium. Written by the ever entertaining and brilliant Nury Vittachi, this book offers a fascinating and unique insight into the eccentric world of Faber, the financial guru extraordinaire. The book also features a detailed portrait of Faber, the man, including insights into the unconventional way Faber conducts his research, his background, and his history of his winning and losing predictions. Marc Faber, PhD (Hong Kong) is an investment advisor and publisher of the "Gloom, Boom, and Doom" Reports. Nury Vittachi (Hong Kong) is one of Asia's most popular writers and speakers.
Synopsis
Dr Marc Faber, a.k.a. "Dr Doom", is a Hong Kong based investment adviser. He has been warning Asia for many years of its impending financial crisis, now that this crisis is reality, his views are more in demand than ever. This text looks at Faber's life in Asia and his predictions for the forthcoming millennium. In this text Nury Vittachi offers an insight into Faber's background, including his history, his winners and losers and the unconventional way that he conducts his research. The result is a detailed portrait of "Dr Doom" - who he is and how he came to be in his present position.
From the Inside Flap
"The book, Riding the Millennial Storm, is entertaining, highly readable and most important, provides an understanding of how Marc Faber, one of the great financial and investment minds in the world today, analyzes the major trends in the financial markets and economies of the world. Dr Faber always provided his readers and clients with insights into the futures which are grounded in historical understanding, healthy scepticism for the investment fads and manias of the day an accurate knowledge. Such knowledge is derived from his own research into what is rally going on below the surface. This book is most timely now that the global investment mania, which Dr Faber predicted, has ended. Investors who refuse to heed his warning will continue to pay a heavy price."
- J. Anthony Boeckh chairman & Editor-In-Chief The Bank Credit Analyst Research Group
"You will learn an enormous amount from Marc Faber - whether you agree with him or not!"
- Jim Rogers, author of Investment Biker
"One does not go to see Marc Faber, Hong Kong's iconoclastic share pundit, in the expectation of good news. But after listening to him, no investor could claim he had not been warned. For Faber, a blunt-spoken Swiss, says the things nobody want to hear..."
- The Sunday Times (London)
"(Faber) is the region's (Asia's) most notorious bear."
- The Wall Street Journal
"(Faber) is something of an icon."
- The Financial Times of London
Meet Dr Doom. If there are two sides to every coin then Dr Faber is almost always on the other side. Famous for his contrarian approach to investing, Marc Faber does not run with the bulls or bait the bears but steers his own course through the maelstrom of international finance markets. In 1987 he warned his clients to cash out before Black Monday in Wall Street; he made them handsome profits by forecasting the burst in the Japanese Bubble in 1990; he correctly predicted the collapse in US gaming stocks in 1993; and he foresaw the Asia-Pacific financial crisis of 1997/98 and the resulting global volatility. Now Dr Faber has re-drawn his map of the world and sees the approach of a period of global financial restructuring that will transform the established world order. In this original and entertaining read, Asia's leading satirist Nury Vittachi, profiles the Swiss-born investment guru, reviews his spectacular successes (and equally spectacular failures) and details his complex view of the next twenty years - a time when investors will be on an exhilarating rollercoaster ride to a barely recognizable world.
"Marc Faber is one of the most creative and original thinkers in the financial world. A fabulous book!"
- Baron M. Biggs Chairman, Morgan Stanley Asset Management, Inc.
"I love Marc Faber. He is a thoughtful contrarian with a historical perspective. He doesn't fit the conventional mould, which is why he is successful. Long may his ponytail wave."
- Robert R. Prechter, Jr. President, Elliot Wave International
Includes
How major economic waves signal a red alert at the end of the 1990s
Where to look for safe investment sin an uncertain world
Faber's Dark Side Theorem: The inevitability of wealth destruction and its invisibility
Why rock-solid investment winners are losers
How Shanghai will become wealthier then New York
Vital lessons form the stalled growth in Japan
How technology, is increasing, not decreasing the dangers of investing
About the Author
Nury Vittachi is one of Asia's best known writers. He has written 10 books, and produces at least 150 newspaper columns a year. Originally a refugee from the civil war in Sri-Lanka, he now lives in Hong Kong with his English wife and tow adopted Chines children.
REVIEW columnist Nury Vittachi's new book is a profile of Marc Faber, an eccentric gadfly, historian and financial adviser based in Hong Kong. Faber is known as 'Doctor Doom' for his predictions of a global economic meltdown.
Conference appearances by Marc Faber are often followed by animated discussions between confused reporters. They know that the Hong Kong based investment advisor has become an economic icon. They have press clippings in which he is called The Prince of Pessimism or The Godfather of Gloom. But that doesn't really gel with what they have just seen - an investment analyst with a somewhat chequered career whose enthusiastic words conjure up a bright future for some of the world's poorer countries, and who is confident that his advice can preserve the wealth of those who listen to him.
The press have tried to simplify him, and to simplify is necessarily to mislead. In fact, neither Faber nor his theories are particularly pessimistic. Whence does this contradiction arise? Perhaps the fundamental train of thought behind his investment philosophy is best summed up by his favourite anecdote:
It's a bitterly cold day. You have lost all feeling in your nose. Your ears are hurting. You hunch your shoulders together to bury your head under the raised lapels of your greatcoat. You turn a corner and you see a frozen pond. Can you risk taking a short cut across? Or would it be safer to walk to the bridge half a mile down the road? You notice a man on the other side of the pond. He gingerly steps on to it. It holds the weight of one foot. He carefully places the other foot on the ice. A young woman behind follows his lead. As you watch, some children arrive with skates, and more adults follow them. Soon, the whole village is having a party on the ice. Each person has given the next person the confidence to join the party. The more people clambering on to the ice, the safer it feels. It's logical, isn't it? Or is it? Something makes you stop. You turn around. You walk away. Behind you, you bear the crack and the first scream.
That is Mare Faber's vision. Yes, you could say it is a dark vision, but it does the opposite of what most sunglasses do. Instead of increasing obscurity, it introduces clarity. As an increasing number of heavy bodies add themselves to the ice, human nature makes them feel the safety factor is increasing. But the clear-thinking observer realizes that their added weight means that the opposite is true. Each fresh body on the ice makes it more - not less - likely that the ice will crack.
The global investment business today is a business in exactly the same way as the street market in Camden Town or Bangkok is. It is manned by salespeople who all have products they want you to buy. They make sure that what they sell is attractive. They tell you uplifting stories of how buyers of their services have generated wealth for themselves. They attract you to the ice ...
. . .It's 2 a.m. on a Friday in Hong Kong and the U.S. market is having a good day. It's May, 1996, and the Dow Jones is floating upward like a helium balloon. FM Select 104 is churning out "Don't Worry, Be Happy." Faber is in his office, absently humming "Everything is Beautiful." He is sitting at his word processor waiting for some inspiration for his newsletter....
Earlier that evening (or first break period, considering Faber's 24-hour schedule) he had been chatting with this reporter about the creed of the mom-and-pop investor. Their Ten Commandments go something like this:
Everything comes to the patient investor.
The best way to make money is to buy blue chips and then forget about them for a long time.
In the long run, stock prices always go up faster than other investments.
You can never lose money in real estate, as long as you are willing to wait long enough.
Buy a commodity and sit on it.
Buy real estate and sit on it.
Buy a Ming vase and sit on it (but only metaphorically).
If you wait long enough, an untraded position on the S&P will do better than the most vigorously traded mixed portfolio.
The best retirement fund is a nice chunk of real estate.
Patience is a virtue, so wait at least a week between buying and selling.
The CARPATHIA letter
The southeast Asian Tigers made a lot of investors a lot of money in the '80s and early '90s. Then, in late '97 and early '98, they plunged 70% to 85% in a matter of months ...
Russia's brand-new stock market gained over 500% in an 1 8-month period through early '97. Now it's down over 90% since August...
After adopting its new currency in July of '94, Brazil's stock market rose 285% over the next three years. Now, it's fallen 60% since mid '97. And many feel it has a lot lower to go...
Is there any way to avoid getting burned in the emerging/submerging markets?
The CARPATHIA letter
Yes, says Dr. Marc Faber in his brand new book. You should always be wary of investing in countries that "depend on large foreign-capital flows in order to sustain their excessive spending."
The Wall Street Journal (WSJ) calls that "good advice." But-they might be missing the bigger point. Faber also says that this is "a condition which will one day also haunt the United States."
These and other useful observations are available in the newly released book "Riding the Millennial Storm: Marc Faber's Path to Profit in the New Financial Markets". According to the WSJ, the book "offers practical, easy-to-understand explanations of his investment strategy... in a humorous, if slightly self-aggrandizing, manner."
We agree with the first part of that assessment, but as for the rest of it ... well, maybe a little.
The CARPATHIA letter
But even the WSJ would have to admit that if any fund manager/financial analyst is entitled to "self aggrandize" now and then, it would be Mare Faber. WSJ conceded as much in a feature story it did on him last year. In that article, the Journal cited a list of his rather amazing accomplishments.
It pointed out that Faber "called the '87 crash one week before it happened," and that he is "also on record for making other good bets." Among them: "pushing oil service stocks before they doubled in one year, telling Hong Kong investors to focus on China plays after Tiananmen Square in 1989, promoting Brazil in 1990 just before that market more than doubled, and getting into Russia before that market soared [and getting out before the crash], to mention a few." In other articles, the Journal recognized that Faber also predicted the Asian crisis months before it happened.
Now, a book that's fun to read and tells you how he did all that... is no doubt worth putting up with a little self-aggrandizement. It's the perfect gift, as the WSJ says, "for the friend who has everything and wants to double it."
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