When it comes to commodities, Marc Faber, know as “Dr. Doom” by the financial press, prefers gold over oil. During a conference call hosted by U.S. Global Investors last Friday, Dr. Faber, who is famous for advising clients to get out of the U.S. stock market one week before the October 1987 crash, said:

I personally would rather buy gold at this stage than oil.

Nathan Becker of MarketWatch wrote Friday:

Although he said he wouldn’t rule out oil prices rising to $150 or $170 a barrel, Faber said the U.S. government’s recent discussions about how to limit speculative trading in oil futures could pull the plug quickly.

“I think we could have a serious correction — to $100 or below,” he said. “To curtail speculators in commodities in the U.S. could drive people like the pension funds… to go and buy gold.”

Faber also mentioned that gold is “very, very cheap” compared with oil now and that the oil-to-gold ratio is at its highest level ever.

Cheap?

The publisher of the monthly investment newsletter The Gloom Boom & Doom Report continued on this theme while speaking to CNBC’s “Worldwide Exchange” Friday. From the CNBC website:

Investors should go into gold as its price did not rise as fast as that of other commodities while the central bank keeps printing money, Faber said.

The Swiss-born investor told CNBC he believes gold may continue to shine while demand for other commodities declines as the result of a slowing global economy.

Sources:

“Contrarian investor prefers gold over oil”
Nathan Becker
MarketWatch, June 27, 2008

“Let Big Brokers Fail; Buy Gold Not Oil: Marc Faber”
CNBC, June 27, 2008

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