With US markets seemingly shrugging off the latest PCE print and the Fed’s repeated phlegmatic stance on price pressures, US hedge fund manager Kyle Bass appears to have a significantly different interpretation of the current economic landscape.
In a recent CNBC “Closing Bell” interview, Bass, the founder of Hayman Capital Management, reiterated his claim that real inflation likely stands at around 12%, and that price pressures are increasingly evident “in every single aspect of life.” Bass attributes America’s surging prices to the Fed’s dovish monetary policies, which have pumped the most money into the economy in the shortest amount of time in US history.
The famed investor warned that inflation has gained a strong foothold in the US economy, and will likely persist for the foreseeable future. Even with the Fed beginning to contemplate a “talking-about-talking-about meeting“ regarding the potential tapering-off of asset purchases, Bass thinks that the central bank will not be able to downsize its balance sheet so easily. “We’re going to see prices stay high and move higher over time if the Fed continues to expand its balance sheet which I think it will,” Bass explained to CNBC.
When questioned about his substantially opposing viewpoint on inflation relative to Jerome Powell’s, Bass remarked: “Your bank account is the final determinant whether there is inflation or not.”
Information for this briefing was found via CNBC. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.