Author of the Gloom Boom & Doom Report, has bad news for Greece.
In the new issue of Barron's he explains, "There is no resolution to the problem in Europe because no one wants to accept austerity."
Having said that, he explains what the best outcome would look like for Greece:
The best outcome for Greece probably would be to exit the euro zone. But the new Greek drachma would depreciate by 50% to 70% against the euro. The Greeks don't want their pensions paid in a depreciating currency. Nor do they want austerity, as their pensions and government salaries would be cut by 50%.
Given the unpleasant nature of that outcome, it's no surprise that Europe's debt crisis continues to drag on. According to Barron's, Faber think we won't see a "breaking point" for three to five years.
Given all this, it's no surprise that Faber is a fan of gold:
I am also warming to gold shares. Gold corrected to $1,522 last December from $1,921 in September. It rebounded to $1,795 in February and is back down around $1,600. The correction could last longer, but given that governments will print more money, gold is relatively effective as a currency. My preference is physical gold, but I would also own some gold shares, which have been decimated.
Read more: http://www.businessinsider.com/marc-faber-best-outcome-for-greece-horrible-2012-6#ixzz1xUUMdHrm
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