One man alone cannot make ‘America great again’. That you have to realize,” warns Marc Faber, the editor of “The Gloom, Boom, & Doom Report,” reminding the world that the US stock market is vulnerable to a seismic sell-off that 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 CNBC’s 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:
“Trump, unlike Mr. Reagan, is facing huge, huge headwinds — including a debt to GDP that is gigantic, as it is in other countries.”
Faber lists rising interest rates and record earnings and margins as additional risks to the historic rally.
The Dow Jones Industrial Average closed at a record level for a twelfth consecutive session today with the S&P 500 to see the fewest declines in February than in any month since May 1990.
