Friday, October 31, 2008

Marc Faber: Fed and Treasury will prop stock prices

Marc Faber speaks on Bloomberg TV on Ben Bernanke's strategy of pumping more money into the credit system.

He says that Bernanke and Paulson are mainly interested in propping up stock market asset prices and thus will support a three to six month rally in equities. This will eventually result in soaring worldwide inflation in his view.

Inflation may be held in check now by low commodity and especially oil prices; deleveraging and falling real estate prices, but the intervention and injection of money will eventually inflate prices.