BL: Marc Faber Says Dollar May Rebound for Three Months (Correct)
By Lynn Thomasson and Kathleen Hays
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(Corrects spelling of Marc Faber's name in headline.)
April 30 (Bloomberg) -- The U.S. dollar may rise against world currencies for the next two or three months, sending commodity prices and stocks lower, said Marc Faber, managing director of Marc Faber Ltd.
``The U.S. economy is in a recession but that doesn't mean the whole thing is going to fall apart,'' said Faber, publisher of the Gloom, Boom & Doom report, who told investors to buy gold at the start of its six-year rally. A ``relative tightening of global liquidity should be supportive for the dollar and negative for asset markets and commodities,'' he said.
Forecasts that companies in the Standard & Poor's 500 Index will earn $110 a share in 2009 are too high, the Hong Kong-based investor said in an interview with Bloomberg Television. ``Earnings will be much lower than that and that will keep some pressure on equity prices,'' he said.
The U.S. economy expanded at a 0.6 percent annual pace in the first quarter, reflecting an increase in inventories, the Commerce Department said today. The dollar has lost 10 percent against the euro since Sept. 18, when the U.S. Federal Reserve began lowering the fed funds target from 5.25 percent. The bank cut the rate to 2 percent today.
To contact the reporters on this story: Lynn Thomasson in New York at lthomasson@bloomberg.net; Kathleen Hays in New York at khays4@bloomberg.net.
Last Updated: April 30, 2008 22:37 EDT
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