Marc Faber: Rebound by Financials Is Selling Opportunity

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I had good luck with Faber's call to buy gold. Here is his view on the financial institutions. Do you agree with his view?

Rebound by Financials Is Selling Opportunity: Faber

By CNBC.com | 02 Apr 2008 | 10:52 AM ET

The rebound in financial stocks is a golden opportunity to sell, as earnings will not return to the values before the beginning of the credit crunch, editor of the 'Gloom, Doom and Boom' report and long-standing bear Marc Faber told CNBC Europe Wednesday.

f troubled banks are not rescued, as was the case with Bear Stearns, their problems risk spreading through the whole financial system, Faber said, adding that "all financial institutions are toxic."

"The bubble in financial stocks has burst and that signals that the fundamentals aren't going to come back the way they were previously," Faber, who is managing director of Marc Faber Limited, told "Squawk Box Europe."

"Overall I think we can have a rebound in financials; I would rather use the rebound as a selling opportunity," he added. "In my opinion, financial sector earnings will not come back to where it was prior to the credit crisis we had."

His comments echoed remarks by European officials on Wednesday that the end of the financial markets turmoil was still far from sight.

The peak of the global financial market crisis has not yet been hit, European Union economic and monetary affairs commissioner Joaquin Almunia told German daily Frankfurter, while European Central Bank Governing Council member Axel Weber said it was too early to give the all-clear on the financial crisis.

Faber slammed the Federal Reserve and other U.S. authorities for not being able to identify the 'gigantic bubble' in the housing market and the measures they have taken to ease the liquidity crisis.
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http://www.cnbc.com/id/23914826