Marc Faber Says U.S. Rescue Plan Will Fail to Avert Recession

Investor Marc Faber said any proposal to rescue the U.S. financial system will fail to avert a recession in the world's largest economy.

Any stock rally in the event that a package is approved will be temporary and should be used as ``an opportunity'' to sell, said Faber, who predicted the so-called Black Monday crash in 1987. U.S. lawmakers voted yesterday to reject a $700 billion plan worked out by congressional leaders and the administration of President George W. Bush.

``The rejection of the package is good because it shows that some people in the U.S. are still sane,'' Faber said in a phone interview. ``A bailout will not buy the U.S. a way out. The government is less powerful than markets in fixing this mess.''

Faber, publisher of the Gloom, Boom & Doom report, told investors to sell U.S. stocks a week before 1987's so-called Black Monday crash, according to his Web site, and recommended buying gold at the start of its six-year rally. He manages more than $300 million.