Dr. Marc Faber spoke with Fox Business today and staked out a bold claim for markets and central bank policy in the second half of the year.

Dr. Faber remarked “If you look at the performance of Treasury bonds (post Brexit) they would indicate that there is a sense that the economy is weakening and that there are problems in the financial system. Also if you look at the performance of European banks stocks, they are horrible performers. Clearly Brexit means more money printing from central banks… I think before the years ends we will have some form of QE4 in the US.”

Replying to the rebuttal that Fed officials assign low probability to a recession this year, Dr. Faber continued “all recessions have come unexpected to most strategists and economist and certainly to most government officials… The fact that they (the Fed) assign a low probability to a recession does not give me any comfort at all. The problem will be that if there will be no additional QE around the world, not just in the US but around the world, asset values will stop going up… The recession is not going to come from the economy per say but from asset price deflation.”