What makes Marc Faber run against the grain?

At the end of the following article on Dr "Doom" Marc Faber, the author asks: " What made Marc Faber run against the grain? I conjecture that it has to do with his intellectual school of analysis: Austrian economics! It is the unique economic paradigm that has distinguished him for many years from the crowd of wall street and it is the unique approach that enables him to stand above the propagandas and the lies and deceits perpetually thrown at the masses days in and days out. 

The thing about predictions is that if you make enough of them, eventually they’ll start to come true. Being a good enough prognosticator to hold the investor community’s attention most of the time is an entirely different matter.

Axel Griesch | ASFM | Getty Images Dr. Marc Faber

That’s what economist and market forecaster Marc Faber has clearly become. But even he isn’t perfect. His best prediction of all time, he says, was also the worst investment call he’s ever made.

“That was the prediction that the tech bubble would burst,” which he made in 1998. “But it came two years too early.”

Like good comedy, the secret of forecasting is timing – only less funny if you’re the butt of the joke. The Nasdaq more than doubled after he made the call, before crashing in March 2000, so Faber still lost money shorting tech stocks.

Identifying market lows is much easier than calling market highs, Faber believes. Bubbles always seem to blow up further than expected. “I have always underestimated the madness of the investment community,” he says.

In terms of timing, his best bet was to recommend selling stocks a week before the 1987 crash. But even that had more than an element of luck. “It was a coincidence that it happened a week later,” he admits.

Still, it’s those kinds of calls that have made Faber a favorite board member, panelist and prognosticator. Subscriptions to his monthly “Gloom, Boom & Doom Report” run as high as $1,500 per year, or $300 for an abbreviated market commentary.

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