Faber Sees '87-Type Crash -- Or Worse -- Coming

Mark Faber of the Gloom, Boom & Doom Report is currently leaning decidedly to the “gloom” side when it comes to stocks.

Faber tells CNBC that it’s very hard to find value in the market right now. “I think there are some groups of stocks that are highly vulnerable because they’re in cuckoo land in terms of valuations,” Faber said. “They have no earnings. They’re valued at price-to-sales. And this is not a good metric in the long run.”

Faber thinks investors are beginning to realize that the Federal Reserve has “no idea what they’re doing,” and thinks that realization is going to lead to big declines. “This year, for sure — maybe from a higher diving board — the S&P will drop 20 percent,” Faber said. “I think, rather, 30 percent. Who knows. But all I’m saying is that it’s not a very good time, right now, to buy stocks.”
“I think it’s very likely that we’re seeing, in the next 12 months, an ’87-type of crash,” Faber said. “And I suspect it will be even worse.”