Marc Faber envisages a new world emerging from the post-pandemic great lockdown release.
“Some people will think ‘we don’t need to travel.’ Some people will prefer to have conversations over Skype or Zoom rather than visiting their customers. People’s behavior will change” said Marc Faber.
Marc Faber (February 28, 1946) is a Swiss investor based in Thailand and he is the publisher of the well known Gloom Boom & Doom Report newsletter.
The 2020 pandemic has forced many businesses to adapt to remote working, consumers to order online, schools, and universities to develop online learning platforms, people to meet and greet through digital platforms, and people to transact using contact-less digital payment systems.
“Some people will think ‘we don’t need to travel.’ Some people will prefer to have conversations over Skype or Zoom rather than visiting their customers. People’s behavior will change”
The digitalization of the way society conducts itself in a social and a business setting was already underway, but this forced digitalization on society could have altered human behavior permanently, which could be why Marc Faber envisages a new world emerging from the post great lockdown pandemic.
So a new world where fourth revolution technologies spearhead the digitalization of everything. Where society goes willingly cashless to avoid contagion, preferring not to use notes and coins but instead contact-less digital payment systems.
Perhaps we are already on the cusp of this new world as masses of human labor struggles to remain relevant, to add value where smart bots and AI technologies displace humans from the productive economy at an alarming rate.
Marc Faber envisages a new world emerging where there are a few big winners and many losers
So this new post-pandemic lockdown world will continue to skew wealth upwards.
“forced digitalization on society could have altered human behavior permanently”
But why should anyone be surprised?
The central bank’s asset purchase program, known as quantitative easing QE, was ramped up in April. QE to infinity has arrived with Global QE Asset Purchases expected to reach 6 Trillion US dollars in 2020, according to Fitch Ratings.
So the central banks, through their QE programs have financially engineered rising asset prices going forward, irrespective of the dire fundamentals in the economy. It is a game that has been played out for more than a decade now.
In other words, the stock market has become the central bank trillion-dollar perpetual-motion machine, when they want stocks to rise they make it swing higher with more QE. The fact that the last few months saw great depression levels of unemployment, that the stock dividend drought shows no sign of abating no longer matters in a central bank central planned stock market, where price discovery remains permanently in lockdown.
“The financial and monetary policies implemented by the USA are extremely dangerous” – Marc Faber
Marc Faber envisages a new world emerging, the emergence of today’s neo socialism, and the rise of machines, which will be aided and abetted by the central banks’ free fiat money
Those higher up the human food chain, the1%, asset rich will see their wealth grow as QE keeps assets prices inflated. The ever-growing numbers of displaced workers will slide into the central bank’s poverty safety net.
Many of today’s furloughed workers may not get jobs back.
A recent report published by the National Institute of Economics and Social Research
noted that furloughed workers, a new term, will only be re-employed if their companies are solvent and they still have a market to sell to.
Marc Faber envisages a new world emerging where the central banks pacify both ends of the human food chain with free money to usher in this new dawn of neosocialism
The people’s QE, Universal Basic Income (UBI), also known as Modern Monetary Theory (MMT) will be the carrot dangled in front of the sheeple to prevent a social uprising. It will work, bearing in mind most people would willingly stay at home and get paid not to work.
But Marc Faber also notes that this transition to neo socialism is not without risks.
“The financial and monetary policies implemented by the USA are extremely dangerous” said Marc Faber.
“US dollar is strong against the currencies of the markets that have been developing for a long time, but this situation may change” – Marc Faber
Put simply, Marc Faber envisages a new world emerging where US dollar stability is threatened
“US dollar is strong against the currencies of the markets that have been developing for a long time, but this situation may change” Marc Faber.
“By this time, the US dollar gained strength, gained 20 percent against the Brazilian real and the Mexican pesos. Last year, the Turkish lira also lost about 20 percent against the US dollar. We see that it continues this year as well. The Russian ruble also lost 20 percent against the dollar. “The dollar was very strong. But when I look at the US’s financial deficit and money-making, I do not believe that the dollar can continue to be a strong currency. I think the financial and monetary policies implemented by the US, in the long run, are extremely dangerous and negative for the dollar” said Marc Faber.
Marc Faber, however, remains optimistic about emerging markets, particularly Turkey
“I think emerging markets with lower levels, including Turkey (future period) could rise again quickly” he said. Marc Faber doesn’t believe investors will need to wait a long time to profit in emerging markets. “Investors in emerging markets will have the opportunity to win over 2-3 months, in Turkey included” he added.
Marc Faber envisages a new world emerging where fiat currencies are weakened due to MMT and where global travel never returns to the post-pandemic levels
“The global economic system will change drastically after the coronavirus epidemic is taken under control” said Marc Faber.
“Revenues of the airline companies decreased by 95 percent and this situation will improve when the flights start, but the previous high levels may not be reached” he added.
So Marc Faber envisages a new world emerging, neo socialism with planned financial markets, courtesy of the central banks QE, and large portions of the population dependent on UBI or MMT. But the road ahead could also be perilous.