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“We believe that a retrospective look will show that the champion of impatient madness in the US stock market will be the period that is unfolding right now.”
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This is billionaire Paul Singer of Elliott Management, who suggests that the equity market has almost skipped the shark, in a Jan. 28 letter to customers, Bloomberg reported Friday.
Shares on Friday culminated in a blunt week with heavy losses as interest rates have gone slowly and then suddenly, and investors are also worried about high valuations in everything from so-called meme exchanges, which investors crowd on Reddit to bonds. , which may be facing high inflation expectations.
U.S. government bonds, long-standing, recorded their biggest monthly gain since 2016, meaning the prices of risk-free fixed-income bets were hammered. And investors are worried that the Dow Jones Industrial Average DJIA,
the S&P 500 SPX index,
and the high-flying, technology-powered Nasdaq Composite COMP,
face a difficult path ahead, as higher lending rates make speculative stocks less attractive.
In any case, Singer believes the market is out of service and warns that Bitcoin betting BTCUSD,
and high-value companies such as electric vehicle manufacturer Tesla Inc. TSLA,
defended in his estimation by a multitude of investments, he will finally have him and his team at Elliott declaring, “We told you so.”
Bloomberg reported that Elliott Management, which was preparing for the pandemic’s stock market crash long before other investors, made money each month in 2020, even during the March carnage. The stock benchmarks reached a one-year low on the 23rd of this month.
Elliott, which manages more than $ 40 billion, has posted annualized gains of 13% in its 44th year, surpassing the S&P 500 index. Meanwhile, Singer’s net worth stands at $ 3.6 billion, according to Forbes.
Even before the onset of COVID-19 coronavirus disease, Singer had been preparing for a major market crash. In 2017, he raised $ 5 billion for a fund for rainy days in preparation for what he described in a letter as a time when “all hell” was coming off. At that time the market was at a standstill, remaining stubbornly afloat, due in part to investors’ propensity to buy leveraged VIX VIX,
products and treat market falls as opportunities, until this trade exploded.
It’s not clear what Singer’s hell is like now, but it clearly holds less than favorable outlook on the economy and the market, even when vaccine implementation and pandemic relief legislation make recovery possible. solid of the worst pandemic in more than a century most likely.