INTERNATIONAL. Speaking on CNBC Squawk Box Europe, Marc Faber the Swiss fund manager and Gloom Boom & Doom editor and publisher said on Fiday that asset markets are "terribly oversold" now, while investors are going overboard into the US dollar and US Treasuries.

"What you could see in the next three months is a very strong rebound in asset markets, in equities, followed by a selloff in bonds and eventually a selloff in the dollar," he said.

"I still like gold," Faber said, because it is cash and not the liability of someone else.

He however warned the assets that held up very well in the current crisis may not perform well near term. "If we get a rebound in equities, it is conceivable that people will sell assets that held up well and try to put their money in distressed assets,' he said.

“Gold price could easily drop to US$700 per ounce before it enters into a rise but one will see much higher gold prices eventually because paper money is over time losing its purchasing powers in the world. It’s very clear that every currency is losing its purchasing power in the world", Faber told India's CNBC-TV18 last month.

Faber also believes that the gold mining exploration sector is extremely at depressed levels and even if gold falls, gold mining exploration companies will go up.

Governments and central banks around the world are providing liquidity and that will eventually have an impact, Faber said.

And once the buying starts the rally is likely to be "stronger than people expect" given that financial institutions are sitting on so much cash, he added.

"I think the intervention by the government in the past and at the present time has created more volatility, not less, and so right now we have deflation, we have colossal deflation in asset prices," he told , noting that equities alone have lost US$30 trillion globally.

The Gloom Boom & Doom editor warned that if markets remained down for a longer perid, the current crisis may end up being worst than the 1929 depression.

Statistically a rebound should happen, but if it doesn't "the air is out" and the world faces an economy "worse than the depression of '29 to '32," he said.

"I would prefer agricultural land to property in a financial centre."