Interesting comments here from Ray Dalio at the Dealbook conference. This the is first glimpse at the fund manager’s 2013 outlook. Business Insider has provided a nice summary:
- Yields can’t go down anymore.
- Austerity is coming.
- Economy is running out of steam.
- QE is losing its efficacy.
- Rate turn probably finally coming late in 2013.
- The world is still in deleveraging.
- Sounding bearish: Risk premiums are likely to expand.
- It all comes down to interest rates. As an investor, all you’re doing is putting up a lump-sump payment for a future cash flow.
- In all deleveraging, you get through them by having an interest rate that’s lower than the growth rate.
- The big question is: When will the term structure of interest rates change? That’s the question to be worried about.
- Effects of QE diminishing as we do more rounds.. We’re facing austerity. And growth is flagging. This is an unprecedented risk the economy is facing. A slowdown with very little room to maneuver.
- The yield curve is certainly at the bottom. And so we’re squeezed on where they’ve gotten us in terms of.
Read more here.
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.
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