Famous for his contraire approach to investments and looking in the opposite direction to ?the herd? for money-making investment opportunities, Swiss-born Dr. Marc Faber delivered his brand of wisdom to an audience of money managers during a stop-off in Bermuda.

Over the past 37 years he has built a track-record for predicting market trends. On the whole he has got it right more often than not. His monthly ?Gloom, Boom and Doom Report? highlights his unusual investment opportunities and is available online on a subscription-only basis.

People pay to know what Dr. Faber is tipping next. No surprise then that the Chartered Financial Analyst Institute of Bermuda wanted to know his latest ideas.

Before his presentation at the Fairmont Hamilton Princess he spoke to about world markets.

The million dollar question was: Where will the smart money be going next? Would it be China, India, Vietnam, or one of the other emerging markets?

A direct answer, such as sticking a pin in a map of the world and Dr. Faber exclaiming confidently: ?Put your cash right there!? was, alas, not forthcoming.

Instead, like a whimsical astrologer, he spoke in general terms and allowed the listener ? and the reader ? to seek clues within his train of thought.

With Wall Street and other stock exchanges seemingly hitting record highs on a weekly basis everything is rosy, isn?t it?

Dr. Faber blows away some of the smoke that surrounds the bigger picture as he observes: ?Since 2002 everything has been going up. Stocks, bonds, commodities, gold are all up. But the US market has lost out relative to other markets like India, China and Vietnam.?

He also makes a point about the value of US stocks compared to the price of gold. Since the US market recovered from the tech-stock bubble bursting in 2000 the Dow Jones value is only half what it once was compared to the price of gold. So while the NYSE and NASDAQ are pushing records, an ounce of gold would now buy roughly twice as many units of stock as seven years ago.

So there is a false illusion within the current feel-good boom, Dr. Faber contends.

?It is possible for the Dow Jones to go up but the value of the US dollar to go down,? he said.

There is another dark cloud to worry about when looking at the US market, said the economist. ?We have had a rally in the US economy since 2002. It is the second longest stretch without a 10 percent correction. There was a rally that started in July 2006, after a small correction, and we have not yet had a two percent correction to that (as would have been expected).?

During the 1970s the Dow Jones would typically fluctuate between 20 and 25 percent. But recent years have seen ?ultra-low volatility?.

Dr. Faber warns: ?Something will happen. I think we will have a series of setbacks in the asset markets, something like 10-25 percent. The value of bonds will go down as interest rates go up.?

Bonds are a poor investment at the moment, in Dr. Faber?s view, although he can see the yield on bonds dramatically improving in the future.

So much for the US. But what about the rest of the world? What about the emerging markets and the so-called tiger economies of South East Asia, an area Dr. Faber knows well as he is based there.

?Asia is less correlated to the rest of the world markets,? he said, explaining that China now produces more aluminium and steel than the US, mostly for its own economic requirements.

Dr. Faber senses that investment liquidity has tightened and he feels there will be corrections within the booming stock markets of China, India and Vietnam.

?In the near-term I would say I?m cautious about those markets, ? he said, before correcting himself: ?No, not cautious, I?d say negative.?

Dr. Faber?s extensive background in world markets and investing stretches back to the early 1970s. He worked for White Weld and Company in Hong Kong from 1973 and then from 1978-1990 was managing director of Drexel Burnham Lambert (HK) before setting up his own enterprise Marc Faber Limited acting as an investment advisor, fund manager and broker/dealer.

Although he has a less active role in market investing these days, he continues to be an advisor and board member on a number of funds in the Asia region.

He is known to many for his 2002 book ?Tomorrow?s Gold ? Asia?s Age of Discovery?.

Explaining his own role in the world of investment and economic speculation he said: ?There are GPs who tell patients the big picture and tell them where to look and where to go to get the specialists they need. I?m a generalist, but in the world of investments. I try to identify fashion changes.?

Dr. Faber?s best moves have involved looking for investments in ?bust? economies, such as Latin America and Thailand 20 years ago. By seeking out such depressed opportunities he has witnessed investment returns of up to 40-fold. He has a record of predicting trends, although admits one he missed was the US bull market of 1991 to 1999.

?It is important to predict what is going to happen. There are some kind of relatively trivial rules that apply to investing, just like life. For one, you can?t have a corporation that grows faster then a country?s nominal GDP over more than short-term. It might manage 10 or 15 years growing at 20 percent per annum, but as it gets bigger its growth is tied to the country?s GDP,? said Dr. Faber.

He gives as an example the US giant Wal-Mart, which is so large that it is practically impossible for it to outperform the US?s own GDP growth. Dr. Faber currently sees investment bubbles almost everywhere and in almost every sector, from stocks to real estate to the art world.

He claims we are currently experiencing the ?biggest asset bubble in the history of capitalisation?. What a smart investor must seek out is where there is under-investment.

?A bubble creates an under-investment somewhere else. You have to look to see what has stock or commodity has not participated in the rally,? he advised.

The 1997/98 Asia market crash made stocks in the region very inexpensive.

?If you find something that?s inexpensive it has a good chance of making money. You are not going to make a lot of money from buying in a sector that is already doing well. The big money is made buying something that is totally neglected.?

And where might that be?

The answer appears to be a mixture of commodities and real estate.

?Cotton and sugar are cheap. Real estate in Iraq next to the US ?green zone? is cheap. There is cheap farmland in Argentina and Brazil. You have to scratch the surface to find something inexpensive,? he said.

So is the golden glow of the emerging economies really only a mirage?

Dr. Faber replies: ?When everybody thinks alike, nobody thinks carefully. We could have a big correction in the emerging markets. But the fundamentals are still good.?