On Druckenmiller’s view

His current macro view was the subject of an interview at the Sohn Conference and an article on TheMarket by Mark Dittli.

«Betting on a soft landing is a very very long shot»

A key statement by Druckenmiller can be summarized as follows:
Remember, normally a rate hike cycle does not end until the fed funds rate is above the inflation rate. That happens either because the inflation rate falls or because the fed funds rate rises: Currently, there is still a very, very long way to go.

More highlights

  • 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.
Sohn 2022 | John Collison in conversation with Stanley Druckenmiller

Georg Oehm

Entrepreneur with a faible for braces & shorts (as clothes and investments) who believes in personal development of people & proper and hard work to solve problems & organise projects. Focus on negotiations and investing – always with the end in mind.

Stay up to date

Sign up to receive the latest news and insights from Mellinckrodt.

You may opt out at any time.

© 2020 Mellinckrodt & Cie. AG ・ Zugerstrasse 74 ・ CH-6340 Baar, Switzerland


Willkommen – Welcome

Zugang zur Website / Access to the website

Die nachfolgenden Informationen sind nur für Personen bestimmt, die ihren Wohnsitz in der Schweiz haben. Mit dem Zugriff auf diese Webseite bestätigen Sie, dass dies der Fall ist.

The following information is only intended for persons who are resident in Switzerland. By accessing this website you confirm that this is the case.