On Druckenmiller’s view
Seine aktuelle Makro-Sicht war Gegenstand eines Interviews auf der Sohn-Konferenz und eines Artikels auf TheMarket von Mark Dittli.
«Betting on a soft landing is a very very long shot»
Eine zentrale Aussage Druckenmiller’s kann wie folgt zusammengefaßt werden:
Vergessen Sie nicht, normalerweise endet ein Zinserhöhungszyklus erst, wenn die Fed Funds Rate über der Inflationsrate liegt. Das geschieht entweder, weil die Inflationsrate sinkt oder weil der Leitzins steigt: Aktuell ist der Weg dahin noch sehr, sehr weit.
- Highly highly probable that the bearmarket has ways to run
- Probabilities of soft landing are pretty remote; expecting it goes against decades of history
- When inflation came over 5% it never came down without raising FED Funds rate over CPI (means 8% acutally) and never came down without a recession
- Doesn’t know when recession will occur. 2 Trillion excess savings were able to influence that
- Price vs news is a very weakend tool compared to 20 years ago.
- Learned in Bear Markets to morph in Bonds, Commodites, Treasurys and avoid stocks. He made most money in bear markets. This time bonds may be different. Something like this never happened before. – Bonds are not attractive, but shorting them as 6 months ago seems less attractive. Same with stocks: being too aggressiv in shorts can be very very risky in Bear marktes. Currently he is looking from the sidelines.
- Expects to reopen his stock shorts when markets allows the possibility. Fixed income much more complicated. Currency might get more interesting.
- He would be surprised if in the next six months he would not short the dollar.
- Foreign exchange looks interesting. Energy also and commodities.
- On crypto: you cannot build 2 trillion in wealth, take one out and say that does not matter. Correlation between crypto and NASDAQ is high for obvious reasons.
- He is sympathetic to what Charly Munger says on crypto, and Mill Miller the same. Would be very surprised if Blockchain isnt a real topic five years from now.