Nearly five months have passed since Marc Faber’s prediction of a 10% correction in U.S stocks. It hasn’t happened. Will the month of March be the charm?

Speaking with Margaret Brennan on Bloomberg Television’s Oct. 26 edition of “InBusiness,” Marc Faber, dubbed Dr. Doom, said, “We are in the inflation trade again,” underscoring “a weak dollar, strong precious metal prices, strong equity prices especially in emerging markets and now in frontier markets, plus strong industrial commodities.”

“So, I think a correction is overdue,” he asserted.

Three months later, the pony-tailed, eclectic, Swiss hedge fund manager—who features a medieval-style 17th century plague painting by Kaspar Meglinger, titled Dance of Death, on his Web site’s home page—reiterated his call for a 10% correction in U.S. stocks on Jan. 25.

“A correction is coming,” Faber said in an interview from Zurich on Bloomberg Television’s “Street Smart.”

However, “equities in the U.S. will go down less than emerging markets,” he stressed.  Faber expects a much steeper correction of as much as 30% in an overseas equities, which he has frequently said is a “crowded” trade.

Six weeks since Faber’s Jan. 25 interview, U.S. equities still remain relatively resilient in the wake of spiking oil prices, continuing housing price declines, and lingering questions of the U.S. economy’s ability to create jobs and robust consumer spending again without help from a generous Fed.

The Wall Street adage “climbing a wall of worry” has crept into analysts’ repertoire of responses to media questions concerning the S&P500′s stubbornness to relent to the threat of an oil shock to an anemic (at best) U.S. recovery.

But evidence of a crack in the wall may have developed, supporting Faber thesis of an overdue correction about to become due.

The watch dog blog of everything financial, ZeroHedge.com, posted an observation by Credit Suisse on Mar. 8, which suggests the divergence between the gold price and the price of the economic bellwether base metal, copper, could be signaling a tidal shift toward a risk-off trade is around the corner.

“As Credit Suisse points out, today the Gold/Copper ratio is up by over 4% to 3.32, which happens to be the biggest one day move since June 29, and confirms that not only the copper run may be over, but that derisking and the flight to safety trade is truly back on,” writes the site’s blogger, Tyler Durden (screen name).

An hour later, Durden added another “did you know?” factoid about the normal correlation between crude and stocks moving too far away from the mean, fueling the Faber thesis of a risk-on trading herd maybe ready to finally flee the burning building.  “The last time WTI to Stocks hit a correlation of -0.5 is just after the market peaked in late 2007, early 2008, as the market had started its decline, which culminated with the global sell off of everything not nailed down, bringing the S&P to 666,” Durden reminded readers of what he wrote in a post of a week earlier.

“If Brent confirms the WTI correlation, it may be time to run,” he stressed.

Maybe the gold/copper ratio and oil/S&P500 correlation are indeed hinting where hot money flows of the day are headed—or maybe, unprecedented money creation from a well-coordinated but desperate Fed will just create more and more fat-tail curves for traders to trip over.

Richard Russell thinks the latter is true.

“Richard Russell made a remarkable confession earlier this week,” MarketWatch contributor Mark Hulbert wrote on Feb. 11.  “He [Russell] said that he finds the financial markets to be so inscrutable that trying to time them is close to futile.”

Faber, himself, in an Apr. 27, 2009 Bloomberg interview said, “Don’t underestimate the power of printing money,” arguing that if the Fed wants higher asset prices, it will create another bubble if enough money is printed.

“The more things will go bad, the worse things become, the more the money printer at the Fed Mr. Bernanke will print,” added Faber.  “He will print endlessly. Even if things go bad economically you could have no revenues at companies and no earnings and stocks will go up because of money printing.”

So if oil runs to $150—predicted NYU economist Nouriel Roubini from his Twitter account in February—and stocks continue to at least rest on the wall of worry before climbing higher, maybe Faber will be correct about the Fed’s ultimate response to a threat of another 2009 swan dive, but will be wrong about the direction of stocks—for now.

With the NY Fed’s Permanent Open Market Operations (POMO) on 24-hour duty injecting a minimum of $3 billion per day into accounts of 18 primary dealers, what’s to stop the NY Fed from raising the stakes indefinitely as Faber suggests?  Why not $10 billion per day injected into targeted markets?  How about 20 billion?  There’s nothing standing between a Bernanke Fed and its primary dealer network.

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