As gloom and doomish as he's ever been at the Barron's Roundtable, Marc Faber does, however, lean against Felix Zulauf's recommendation to short the Hong Kong ETF (EWH) as a play on a credit bust in China. Property companies are a big component of the Hong Kong stock market, says Faber, and may have already priced in an implosion as they're selling for just 40-50% of asset values. "I would rather buy Hong Kong shares and short the Nasdaq," says Faber.
It goes without saying that Faber is bullish on gold, but he's a bigger fan of the miners (GDX), noting the fast pace of insider buying in the industry. A member of the board at Sprott, Faber says Eric Sprott has been selling company stock to buy shares in small miners (GDXJ). "If the gold price goes up 30%, Sprott's shares might double, but mining stocks could go up four times."
Making a decent run after a horrid 3-year stretch, the GDX is up 12% YTD; GDXJ up16.8%.