When selling starts in markets, it’ll trigger an ‘avalanche’, Marc Faber says

Marc Faber, the editor of “The Gloom, Boom & Doom Report,” predicted the rally’s disruption won’t be caused by any single catalyst. His argument: Stocks are very overbought and sentiment is way too bullish for the so-called Trump rally to continue.

“Very simply, the market starts to go down. As it goes down, it will start triggering selling, and then it will be like an avalanche,” said Faber recently on “Futures Now.” “I would underweight U.S. stocks.”

Faber, a supporter of President Donald Trump, isn’t blaming the new administration for his bearish forecast.

“One man alone, he cannot make ‘America great again.’ That you have to realize,” he said. “Trump, unlike Mr. Reagan, is facing huge, huge headwinds — including a debt to GDP that is gigantic, as it is in other countries.”

But he’s not predicting gloom and doom for all countries which have been benefiting from a strong run.

There are areas overseas which are in much better shape than the United States, according to the notoriously bearish investor.

“China looks quite attractive,” said Faber. “For the next three months, money can flow into China. The economy, surprisingly, has begun to do quite well. We see that in retail in Hong Kong. We see that in the hotel industry, and we see that in the demand for commodities.”

According to Faber, resource commodities such as copper and gold could also give investors solid profits this year.

“When you look at Trump and his administration, and the way the budget is, I think further money printing down the line is inevitable,” he said — a policy which would could lift commodities even higher.