- We would see low double digit losses by year end.
- What We Should Expect from Upcoming FED Rate Cut
- Bitcoin Is Better Than Stock
Bitcoin – During a CNBC Fast Money Episode, the chief investment officer and managing director of Morgan Creek Capital Management, Mark Yusko, was asked about how much and how long he sees us in the bear market he claimed we are in.
Mark said the previous prediction he made last October that we would finish the year down low single digits actually came to realization.
This year, our opinion is we would be getting a couple of bear market bounces and afterwards, the year end will be featured with low double digit losses and a possible reason for that is the upcoming credit crisis of 2020, he said.
“So I think you know 12 to 14 percent by the end of the year wouldn’t surprise me at all”, Mark averred.
While reinventing his stand on OEM’s (Original Equipment Manufacturer), the investment officer said since September the CARBS (China, Argentina, Russia, Brazil and South Korea) have been ahead of the S&P (Standard & Poor’s) as the latter remains down a little bit.
The likes of Brazil and China are nicely up, and Argentina is going slightly forward.
It has just been reported that oil prices are probably heading slightly lower. South Korea is in free-fall and it is among the ‘four horsemen of the growth apocalypse.’
“So you got copper prices, Dr. Copper, you’ve got 10 year yields you got oil prices and the Cosby when those four things are declining like they are now you’re usually going to have GDP surprise to the negative earnings surprise the negative in stock surprise,” Mark stated.
What We Should Expect from Upcoming FED Rate Cut
On the side of EEM (Emerging market currencies) currencies, Mark said since the past 12 months, the currencies have been a great drag on E.M. returns and Dollar rally seems to be peaking out.
While taking this as reference, Mark said he expect a roll over for the second half due to the weakness around the price of oil.
The Morgan Creek official was later questioned that with the terrible growth of apocalypse and possible rate cut coming from FED, what should be expected.
Mark said the growth apocalypsce is hyperbolic. We should envision one end up for the second quarter, maybe lower for 3rd, recession sometimes late this year and early next year and then shower recession like that of 2001.
In Mark’s opinion, FED, whenever they proclaim closeness to rate cut than hike, they are only echoing more problem. Therefore, we are kind of close to economic weakness than strength.
Low interest rates gestures economic weakness.
“So anytime that the Fed has paused and gone into rate cut mode after a rate hike cycle look back they did it in 2001”, Mark said.
The rate cut they did in 2001 and 2008 were succeeded by drop in markets and a recession, a Global Financial Crisis.
Morgan Creek Investment Officer Says Bitcoin Is Better Than Stock
Mark averred that Bitcoin is better that stock. In December when Bitcoin was $3,100, he was asked about the future of the currency, and he replied: “We’ve issued the Morgan Creek digital crypto challenge we will take bitcoin over the next 10 years starting on January 1st,” and whoever is interested in the other side ‘million dollar charity bet just like the buffet style bet,’ Morgan Creek has got no takers.
And really, Bitcoin afterward went cool with over 100% addition this year while S&P is just up by 14%.
“Going forward from here even over the next year over the next 10 years is not going to be close. Bitcoin is a great diversifying asit has very low correlation. It should be in everybody’s portfolio”, Mark ended his interview.