“So we have an asset bubble. Now that’s not just in tech stocks; it’s in everything.”
A recent statement quoted by one of the men responsible for making a trade that “broke the Bank of England” in 1992. This one single trade was placed against the British Pound and netted his firm over a billion dollars in profit.
Now, the same man, Stanley Druckenmiller, is voicing his concerns about the current conditions of the markets and economy and how they compare to the ones of previous market crashes.
“Like the Dotcom Bubble, current tech valuations are speculative.”
But he doesn’t feel this way about every stock, especially stocks whose companies deliver justifiable value.
However, it’s not to say that certain stocks like Amazon won’t experience their own volatility should the market correction present itself in the future.
When asked what he believes to be the largest threat to the equity market, Druckenmiller had this to say.
“Without a doubt: inflation is strong enough that the Fed responds to it.”
The second catalyst he believes will be the causing of a correction? Geopolitical tensions on the rise.
Like all savvy investors, Stanley does not solely rely on his research and findings alone; he leverages resources and platforms like Ned Davis Research, which happens to be extremely bearish on the US Dollar and extremely bullish on gold.
The market seems to be torn in two where on the one hand, astute, experienced investors are calling for a correction, and on the other hand, smaller retail investors with little to no proven track records believe the hype train will continue.
In September of last year, Druckenmiller told MarketWatch he thinks that the current stance of the Fed is “dangerous” and that, “‘right now, we’re in an absolute raging mania.”
“I think we could easily see 5 to 10% inflation in the next four or five years.”
While no one can be certain what the market will do tomorrow or in the months to come, being prepared is the best strategy one could do to protect their wealth.
Do you have a strategy in place? Call American Hartford Gold today at 800-462-0071; we can help.