Paul Tudor Jones: If Fed Ignores Prices, “Go All In” on Inflation Trades

Paul Tudor Jones: If Fed Ignores Prices, “Go All In” on Inflation Trades

Last month, billionaire hedge fund manager Paul Tudor Jones told CNBC that he’s paying close attention to the Fed given the rise in consumer prices.

If the Fed treats the economic data nonchalantly, he said, “I think it’s just a green light to bet heavily on every inflation trade,” adding he would “probably buy commodities, buy crypto, buy gold.” But he argued that markets would be unsettled if the Fed seems poised for a course correction.

[Note: The upshot of the Fed meeting, which took place on June 16th, was that rates would remain at near-zero, there could be two rate hikes in 2023, and no decision has been made on ending bond purchases.]

According to the article, Fed chair “Powell and company have maintained their highly accommodative monetary policy approach,” and central bankers have been “steadfast despite criticism that massive bond buying at near-zero interest rates is no longer necessary because the economic recovery is well underway.”

Jones argues that the Fed’s inflation views put its credibility at risk. “The only thing I know for certain,” he said, is “I want 5% in gold, 5% in bitcoin, 5% in cash, 5% in commodities. At this point in time, I don’t know what I want to do with the other 80% until I see what the Fed is going to do.”

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