The chance that the global economy falls into a recession stands at 100 percent, says Swiss money manager and Gloom, Boom and Doom editor Marc Faber.

Global investors remain focused on Greece, where a messy exit from the eurozone could rattle the world economy.

However, there are bigger threats lurking on the horizon to which the world is turning a blind eye.

Editor's Note: I Wish I Were Wrong — Economist Laments Being Right. See Interview.

"As an observer of markets — whenever everyone focuses on one thing — like Greece and Europe — maybe they miss issues that are far more important — such as a meaningful slowdown in India and China," Faber tells CNBC.

Factory output in China has been weakening, Faber says, which should ring louder alarm bells than it has.

The HSBC Flash Purchasing Managers Index for China fell to 48.7 in May from 49.3 in April, the seventh straight month that the index has come in below 50, a level indicating a contracting economy.

Expect a broader reaction in the stock market as time goes on.

"There are more and more stocks that are breaking down — economic sensitive stocks and companies that cater to the high end," Faber says.

"That suggests to me the economy is likely to weaken, and the huge asset run is likely to come to an end with significant asset deflation."

"I think we could have a global recession either in Q4 or early 2013."

When asked what were the odds, Faber replies, "100 percent."

Turning to Europe, Faber says he doesn’t expect Greece to abandon the euro, at least in the near term, though such a move would offer market relief by ending agonizing uncertainty as to whether the country will stay or go.

"Although it wouldn’t be good for banks and insurance (stocks) in general I think markets are oversold and with an exit — markets will rally," Faber says.

Calls for all eurozone member nations to issue a single debt instrument, with all governments underwriting and financing the placement, have grabbed headlines lately.

The issuance of the so-called Euro Bonds would help ease debt burdens in beleaguered countries like Greece.

However, European paymaster Germany has been chilly to the idea on the grounds that it unfairly asks some countries to take on debts owed by others, would raise interest rates in healthy economies and would arguably encourage Greece and others to ramp up spending again now that Germany is shouldering more of the bailout.

Germany will likely come around and take part in such an issue, Faber says, as the alternative of Greece leaving and pressuring the larger Spain and Italy to consider following suit is too great a risk.

"What I think will happen is that Germany will show more flexibility and issue more Euro Bonds," says Faber, adding he likes dollar-denominated assets and gold for now.

Fears that the eurozone's economic woes will at least drag on the global economy at best persist.

The Paris-based Organization for Economic Co-operation and Development (OECD), a 34-member international economic organization, is forecasting global growth to come to 3.4 percent this year from 3.6 percent in 2011, though the fragile global economy could easily be blindsided.

"The global economic outlook is still cloudy," OECD Secretary General Angel Gurria told reporters recently after unveiling the organization's latest economic forecast, Reuters reports.

"At first sight the prospects for the global economy are somewhat brighter than six months ago. At closer inspection, the global economic recovery is weak, considerable downside risks remain and sizable imbalances remain to be addressed."

Editor's Note: I Wish I Were Wrong — Economist Laments Being Right. See Interview.