The man who the media likes to call “Dr. Doom” is predicting a much higher price for gold in the future— but not before it languishes a bit more. Bloomberg’s Pham-Duy Nguyen wrote yesterday:

“As markets may recover from now to next March, the full sense of security will come back into the market, and people will not be that interested in gold,” Marc Faber, the managing director of Marc Faber Ltd. and the publisher of the Gloom, Boom & Doom report, said in an interview on Bloomberg Television.

In fact, the Swiss-born investor warned that the price of the yellow metal may drop even more from current levels— before taking off. From Moneycontrol.com (India) this morning:

On gold he said, “Gold price could easily drop to USD 700 per ounce before it enters into a rise but one will see much higher gold prices eventually because paper money is over time losing its purchasing powers in the world.

It’s very clear that every currency is losing its purchasing power in the world.”

For those looking to invest in gold, Dr. Faber, who is famous for advising clients to get out of the U.S. stock market one week before the October 1987 crash, is particular about how one should go about acquiring the metal. Newsmax’s Julie Crawshaw wrote yesterday:

Instead of stocks, Faber advises buying gold in physical form and storing it outside the United States.

Why outside the United States? Well, Faber told Tony Jones of the Australian Broadcasting Corporation the following on Monday:

I’m sure the US Government will eventually go bankrupt. Maybe not tomorrow, but as far as the eye can see, we will have deficits in the US Government, deficits of more than $1 trillion annually.

The Thailand-based investor has mentioned before that the U.S. government may stop American citizens from buying and owning the yellow metal sometime in the future.

Sources:

“Gold Prices Fall as Demand for Haven Drops Amid Equity Rally”
Pham-Duy Nguyen
Bloomberg, October 13, 2008

“End of global turmoil? Mark Faber, Mobius speak”
Moneycontrol.com (India), October 14, 2008

“Grantham: Don’t Get Back Into the Market Yet”
Julie Crawshaw
Newsmax.com, October 13, 2008

“Interview with Marc Faber”
Tony Jones
Australian Broadcasting Corporation, October 13, 2008

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