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“We believe that reflection will show that the champion of headaches in the US stock market is the period that is currently playing out.”
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It’s billionaire Paul Singer of Elliott Management who points out that the stock market made the shark jump right in a January 28 letter to clients, as reported by Bloomberg on Friday.
The stocks limited a great week on Friday with sharp losses as interest rates slowly and then suddenly rose, and investors also became concerned about high valuations in everything, from so-called meme stocks, which are swept higher by investors looking at Reddit merged into bonds. , which may take into account increased inflation expectations.
US long-term US government bonds have achieved their largest monthly yield increase since 2016, meaning the price of risk-free fixed-income bonds has been hammered. And investors are worried that the Dow Jones Industrial Average DJIA,
the S&P 500 index SPX,
and the aviation and technology-powered Nasdaq Composite COMP,
facing a difficult road ahead as higher lending rates make speculative stocks less attractive.
Singer in any case believes that the market has failed and warns that the bet on bitcoin BTCUSD,
and many valued companies such as the manufacturer of electric vehicles Tesla Inc. TSLA,
which, according to his estimate, is being put forward by an investment servant will eventually lead him and his team to declare to Elliott, ‘We told you so.’
Bloomberg reports that Elliott Management, which focused on the pandemic crash much earlier than the other investors, made money every month in 2020, even during the March massacre. Stocks reached the year at 23 on the same month.
Elliott, who manages more than $ 40 billion, recorded annual gains of about 13% in his 44 years, beating the S&P 500 index. According to Forbes, Singer’s net worth is now $ 3.6 billion.
Even before the advent of the coronavirus disease COVID-19, Singer was preparing for a big drop in the market. Back in 2017, he raised $ 5 billion for a rainy day fund in preparation for what he described in a letter as a time when ‘all hell’ breaks loose. At the time, the market was in a period of calm and drifting stubbornly, in part due to investors’ tendency to buy VIX VIX with leverage,
products and treated market declines as opportunities until that trade exploded.
It is unclear what the hell looks like for Singer now, but it is clear that he maintains less favorable economic and market prospects, even if the rollout of vaccines and pandemic legislation is the prospect of a good recovery from the worst pandemic. . in more than a century more likely.