Marc Faber, who writes the Gloom Boom & Doom Report newsletter, has a flare for the dramatic. He once recommended framing a $100 U.S. bond to teach our children a lesson about the perils of inflation. But he has made some good calls over the years, such as to dump stocks a week before the October 1987 crash. He even shorted stocks in 1999 (it was a bit early) and went bearish before the crash of 2008.

Interestingly enough, Faber is actually getting optimistic, especially about the U.S. and Europe (this is according to an interview on CNBC). He likes the traction in the economies. In fact, it does look like the global economic recovery is a reality.

Before you read this, please take your optimistic hat off and put on your pessimistic one. Marc Faber, editor of Gloom, Boom and Doom sets forth his ideas of the future.

His central theme is that the U.S. and Europe will default on their sovereign debts. Standing alone, this is a powerful statement. He explains that governments of developed countries hold huge debt relative to GDP and unfunded liabilities that will become due. Governments will be forced to print money before they default.

Two contrarian signs that a market bottom is approaching have raised their heads. The first is the always somber Marc Faber, the famed proprietor of the Gloom, Boom & Doom Report, who said late last week that the current down-drift in stocks is the beginning of a global bear market.

The second is the increasing chatter that the massive U.S. budget and trade deficits are going to come back to haunt the U.S. economy.

Mr. Faber's bearish pronouncements and the general call by economists and other pundits saying this is the time that the trade deficit is going to crush the U.S. economy almost always coincides with a bottom of the US market.

For the most part, virtually every indicator suggests the U.S. market is approaching a bottom. However, a good contrarian indicator, the AAII Index that measures individual investor sentiment, has stayed stubbornly high. Actually, bullish sentiment has been increasing during this market's decline.