MidnightWatcher – Prophecy in Motion

By Peter Guest – “Markets could rebound after Thursday’s global market sell-off, but investors should see any bounce as a selling opportunity, as the world economy rolls towards total collapse, Mark Faber, editor and publisher of the Boom, Doom and Gloom Report, told CNBC Friday.

A mooted third round of quantitative easing in the U.S. and more money printing elsewhere is merely deferring a crisis that will be bigger and could end in war, Faber said.

The Dow Jones Industrial Average suffered its worst losses in three years Thursday, shedding more than 500 points.

‘My view is that the market has experienced everywhere huge technical damage,’ Faber said. ‘As of today, all markets are extremely oversold, so a rebound is going to happen (Friday) or on Monday, but the damage technically is so great that the rebound, no matter whether QE3 happens right here, it’s unlikely to lift markets above the May 2 high of 1370.’

Faber thinks that by the end of the fall, the S&P 500 will have slid to around 1150, and investors will be hoping that further round of monetary easing will stabilize markets.

‘In general, I would be using rebounds as a selling opportunity,’ Faber said.

Buying Treasurys as a safe haven is no longer a smart play, he added.” Read more.

‘UNPRECEDENTED’: S&P downgrades U.S. credit rating – “The United States lost its top-notch AAA credit rating from Standard & Poor’s on Friday in an unprecedented reversal of fortune for the world’s largest economy. S&P cut the long-term U.S. credit rating by one notch to AA-plus on concerns about the government’s budget deficits and rising debt burden. The move is likely to raise borrowing costs eventually for the American government, companies and consumers.” Read more.