Marc Faber Says Time to Buy Gold Exploration Stocks

Celebrated contrarian investment advisor Dr. Marc Faber told Bloomberg television last weekend that he was buying gold exploration stocks as well as gold producers because prices were ridiculously cheap.

Dr. Faber wrote the book Tomorrow’s Gold earlier in this decade and has long been a holder of physical gold as a hedge against inflation and a meltdown in the global financial system. But he has previously not recommended buying exploration stocks, arguing that they could fall in price and that many companies could go out of business.

...Granted the link between the gold price and exploration stocks - remember the latter own the rights to potential future gold field development rights or claims - then such a price hike would mean an even bigger increase in the value of exploration stocks. That these stocks have been beaten down to almost nothing in the recent stock market crash just makes them a better buy.

Dr. Faber is the first major commentator to make this call - and it comes against the worst performance in this sector in 40 years. Of course, for a contrarian there could not be a better buy indicator. Dr. Faber is about to score another big hit for his investment record. If he was a hunter he would need a castle to house all his trophies by now!