Tudor Jones Says Stocks Should Terrify Yellen

[marketsurfer]

Billionaire investor Paul Tudor Jones has a message for Janet Yellen and investors: Be very afraid.

The legendary macro trader says that years of low interest rates have bloated stock valuations to a level not seen since 2000, right before the Nasdaq tumbled 75 percent over two-plus years. That measure -- the value of the stock market relative to the size of the economy -- should be “terrifying” to a central banker, Jones said earlier this month at a closed-door Goldman Sachs Asset Management conference, according to people who heard him.

Jones is voicing what many hedge fund and other money managers are privately warning investors: Stocks are trading at unsustainable levels. A few traders are more explicit, predicting a sizable market tumble by the end of the year.

https://www-bloomberg-com.cdn.amppr...s-says-u-s-stocks-should-terrify-janet-yellen

 

[comagnum]

I wonder who may be shorting the market?

 

[BONECRUSHER]

Can anyone else tell me the last time stocks made all time highs year after year when the economy only grew 2% or less year after year?

 

[ET180]

Can anyone else tell me the last time stocks made all time highs year after year when the economy only grew 2% or less year after year?

Agree, I think this is a bubble that won't end well...or we just have low/negative interest rates forever.

 

[lawrence-lugar]

"Last edited by a moderator: Today at 5:27 PM"

What did the moderator moderate? ...ET should have an optional (maybe temporary) window link to include the original unedited message post,

As for the topic discussion...I learned a long time ago...to ignore, or stop reading, market forecasts opinions;
Just because you see someone who's old and in a suit...that doesn't mean they are a sage of successful wisdom.

 

[dealmaker]

Billionaire investor Paul Tudor Jones has a message for Janet Yellen and investors: Be very afraid.

The legendary macro trader says that years of low interest rates have bloated stock valuations to a level not seen since 2000, right before the Nasdaq tumbled 75 percent over two-plus years. That measure -- the value of the stock market relative to the size of the economy -- should be “terrifying” to a central banker, Jones said earlier this month at a closed-door Goldman Sachs Asset Management conference, according to people who heard him.

Jones is voicing what many hedge fund and other money managers are privately warning investors: Stocks are trading at unsustainable levels. A few traders are more explicit, predicting a sizable market tumble by the end of the year.

https://www-bloomberg-com.cdn.amppr...s-says-u-s-stocks-should-terrify-janet-yellen

Pared Tudor Fees Still In Hedge-Fund Royalty Zone
byBreakingviews

Even hedge-fund royalty isn’t immune to weak performance. Paul Tudor Jones’ $10 billion firm, Tudor Investment, is cutting fees to 1.75 percent of assets and 20 percent of gains, according to the Wall Street Journal. That’s finally inside the archetypal “2-and-20,” but it’s still above the industry average.

The typical cut taken by hedge funds is slowly shrinking. Newer funds were charging 1.5 percent a year for management and taking about 19 percent in performance fees as of last September, according to Preqin. For many investors, however, that remains far too big a payday in comparison to the scant returns they have received.

The average fund delivered a bit over 5 percent net of fees in 2016, according to Hedge Fund Research. That was an improvement over a loss of 1 percent in 2015 and a slim 3 percent gain in 2014. But it’s uninspiring to pension funds, endowments and other investors. Though it’s not a direct comparison, they know that a Vanguard fund tracking the S&P 500 Index returned 12 percent last year and an average 9 percent over the past three – net of fees of just 0.02 percent.

This is one reason why Californian pension giant CalPERS dumped its hedge-fund portfolio. It’s why some old-timers have closed shop while others, including Brevan Howard, have cut fees drastically. And it’s why Tudor already reduced fees and slashed its staff last year after investors took money out, unimpressed by several years of roughly flat returns, according to the Journal.

There’s optimism in some quarters that the skill that made investors rich and Jones a billionaire – and once able to charge up to 4 percent of assets and in some investment structures up to nearly 30 percent of gains, among the highest fees in the hedge-fund industry – will again come into its own. The idea is that stocks and other investments will perform on their individual merits rather than responding en masse to monetary policies that have kept interest rates ultra-low for years.

Pessimists might counter that the $3 trillion hedge-fund industry is now crowded and much copied, and that a lot of information is far more easily available than it used to be. By sticking at it with hefty fees, though, Jones is betting he can relive at least some of his glory days.

 

[lovethetrade]

Every boom cycle is unique. There still needs to be a trigger that's fundamental to the current environment, that causes the boom cycle bust.

In 2000, there was an excess supply of overvalued junk dot coms that weren't actually worth anything.

In 2007, it was due to the sub-prime mortgage crisis.

Overvalued stocks is usually a requirement but not a cause.

What's unique about the current environment that could cause the stockmarket to burst? Automation, unemployment?

 

[Gotcha]

"Last edited by a moderator: Today at 5:27 PM"

What did the moderator moderate? ...ET should have an optional (maybe temporary) window link to include the original unedited message post,

This is the same guy who so often posts a reply, so you get the email, and when you check out the reply, he has already deleted it. Its simply incredible that Baron gave him vendor status. If I was a vendor here, especially from any trading firm, I would be appauled to be in the same group as him. His journal is nothing but fairly tale, and if the mandate of ET is to promote trading, which we would assume should be profitable trading and doing it right, then promoting this idiot goes completely against what a trader should actually be doing. Sure he has an uncanny ability to drum up business and page clicks, but he is exactly the opposite of what a trading community needs. Baron giving Surf vendor status is like Trump asking the Russians to help him win the election and then wondering why it all blows up in his face later.

 

[marketsurfer]

This is the same guy who so often posts a reply, so you get the email, and when you check out the reply, he has already deleted it. Its simply incredible that Baron gave him vendor status. If I was a vendor here, especially from any trading firm, I would be appauled to be in the same group as him. His journal is nothing but fairly tale, and if the mandate of ET is to promote trading, which we would assume should be profitable trading and doing it right, then promoting this idiot goes completely against what a trader should actually be doing. Sure he has an uncanny ability to drum up business and page clicks, but he is exactly the opposite of what a trading community needs. Baron giving Surf vendor status is like Trump asking the Russians to help him win the election and then wondering why it all blows up in his face later.

Another little scared sleuth boy who never added any value to this site and is too broke to donate to the "cause" as a vendor. Lmfao!

 

[Gotcha]

Another little scared sleuth boy who never added any value to this site and is too broke to donate to the "cause" as a vendor. Lmfao!

You want me to add something? Tell you what. I will call the CME for you and ask them to let you cash in your March YM contracts since you didn't know about rolling them over.