Sunday Morning Coffee

Ray Dalio was the feature interview in Barron’s this week. Below I highlight a few especially useful points made.

The boundaries of the old highs and the boundaries of the lows in the stock market and in the economy will be with us for a long time.

We are entering a period of time in which relations will be more challenging for the U.S. and China. It isn’t healthy that the two biggest countries in the world have a very big debtor-creditor relationship. There is going to be a tendency by both countries to blame each other and be antagonistic.

Our portfolio is mostly skewed to Treasury bonds, gold and emerging-market currencies, especially Asian currencies. We also hold commodity assets that are limited in supply and that high-growth emerging countries need. I want to minimize my exposure to the major developed countries’ currencies — the U.S. dollar, the euro, the British pound and the yen.

3 Comments

  1. Roger,
    vitaliy Katsenelson of contrarian edge had been saying that we will be in a range bound market for 17 years from the 2000 top. He explained that going back to 100 years of stock market history after a bull move like 1981-2000 what comes next is a range bound market, and should last for 15-17 years. He has been on the money so far. He has made some bad calls stock wise like buy jtx and plunges to 1.40, but market wise he been ok.
    Jeff from Milan, Italy

    Reply
  2. The $US is the Rodney Dangerfield of currencies, but whenever there’s a crisis, guess who gets kissed.

    Reply
  3. Just a couple of points:

    First: There seems to be a glaring inconsistency in Mr. Dalio’s stated portfolio. How can he hold Treasury bonds in any meaningful amount and not have significant dollar exposure? Something does not make sense.

    Second: Mr Dalio is not worried about inflation yet. The article review did not mention any holdings of US TIPS. As of late, TIPS have gotten pricey: 1.7% yield on a 15 year security. I read an article around the first of the year about the bond manager at Stevens Inc Investments in Little Rock Arkansas. He sold their TIPS positions because they had gotten to expensive in relation to other types of bonds. So what happens to TIPS prices when the big players feel they need to hold inflation protected assets? Are they headed higher or will they cycle back down to more historical levels?

    Reply

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Sunday Morning Coffee

Ray Dalio was the feature interview in Barron’s this week. Below I highlight a few especially useful points made.

The boundaries of the old highs and the boundaries of the lows in the stock market and in the economy will be with us for a long time.

We are entering a period of time in which relations will be more challenging for the U.S. and China. It isn’t healthy that the two biggest countries in the world have a very big debtor-creditor relationship. There is going to be a tendency by both countries to blame each other and be antagonistic.

Our portfolio is mostly skewed to Treasury bonds, gold and emerging-market currencies, especially Asian currencies. We also hold commodity assets that are limited in supply and that high-growth emerging countries need. I want to minimize my exposure to the major developed countries’ currencies — the U.S. dollar, the euro, the British pound and the yen.

Submit a Comment

Your email address will not be published.

WP-SpamFree by Pole Position Marketing