The Fed “could probably declare victory,” said legendary trader Paul Tudor Jones in an interview on CNBC this morning, pointing out that inflation has been declining for 12 straight months and “that’s never happened before in history.”
However, that ‘good news’ for The Fed is not necessarily good news for stock market investors as Jones warned the economy could enter a recession in the third or fourth quarter.
“I’m not rampantly bullish because I think it’ll be a slow grind,” he said, comparing the period to June 2006, when the Federal Reserve stopped raising rates and stocks rose for another year.
Jones echoed fellow billionaire Stan Druckenmiller’s views of the equity market going nowhere for years, trading in a range, but also was positive on AI:
“I do think that the introduction of large language models, artificial intelligence, is going to create a productivity boost we’ve only seen a few times in the last 75 years,” he said, adding that it could add a 1.5% gain in output a year for the next five years.
Finally, however, the billionaire hedge fund manager saved his most noteworthy comments for Bitcoin.
He said while that he is still holding some of the cryptocurrency – and will always hold – it is a small portion of his total wealth, with his biggest fear the dis-inflationary environment discussed above as well as the anti-crypto sentiment from Washington:
“Bitcoin has a real problem because in the United States, you have the entire regulatory apparatus against it.”
As CoinDesk reports, the hedge fund manager’s comments suggest his sentiment toward bitcoin has cooled somewhat since saying in 2020 that he could see himself allocating as much as 5% of his assets to BTC in the face of monetary debasement by the Fed.
Jones is right though as crypto has become politicized like everything else in the land of the free…
PTJ: “bitcoin has the entire US regulatory apparatus against it”
-> bitcoin is a political/2024 play
— zerohedge (@zerohedge) May 15, 2023
There is at least one politician who is fighting back against the control efforts of the Biden admin with regard digital currencies.
As CoinTelegraph reports, Florida Governor Ron DeSantis signed a bill restricting the use of central bank digital currencies (CBDCs) in the state, according to local news sources.
The governor urged state lawmakers in March to draft the bill.
The new law prohibits the use of a United States federal CBDC “as money within Florida’s Uniform Commercial Code (UCC).” It also bans the use of CBDCs issued by foreign governments and calls on other states to use their commercial codes to institute similar prohibitions.
Florida Bans a Central Bank Digital Currency https://t.co/S8UfWrLZyc
— Ron DeSantis (@GovRonDeSantis) May 12, 2023
At the signing ceremony for the bill, DeSantis said he was spurred into action by U.S. President Joe Biden’s administration’s studies of the new financial technology.
“I don’t think they would have done that if they don’t intend on implementing this,” he said.
Were a U.S. CBDC to be issued, it would be “a massive transfer of power from consumers to a central authority.”
DeSantis also saw the potential introduction of a CBDC as a threat to cryptocurrency:
“I think they want to crowd out and eliminate other types of digital assets like cryptocurrency because they can’t control that, so they don’t like that.”
The law takes effect on July 1.
Tyler Durden
Mon, 05/15/2023 – 15:00
