원문 보기
but first dan druckenmiller ceo of duquesne family office stan just wrote a new op-ed in the wall street journal in his words the fed playing with fire clinging to an emergency policy after the emergency has passed chairman powell courting asset bubbles and and stan in the past you have pointed out that the fed has stayed a little bit too long i think after the financial crisis with emergency accommodation but you seem to have taken your criticism up to a new level to the point of if you combine fiscal policy that we're seeing with the monetary policy it's the the scariest combination in the post world war ii period in your view certainly the most radical policy by a long shot that i've ever seen relatively economic circumstances let's not forget that ben bernanke at the peak was doing 85 billion dollars a month we are now back to normal normalization on gdp we're above trend on retail sales funny last year at the economics club around this time i said that a v recovery was a fantasy i couldn't have been more wrong but this is all about risk reward i understand why the fed and congress did what they did at the time i think it was the right decision on a risk-reward basis but when the facts change you have to change and the facts have changed dramatically since then and yes i don't think i can't find any period in history where monetary and fiscal policy were this out of step with the economic circumstances not one stan you talk about how quickly the job market has come back and he pointed out retail sales a lot of other things that are almost pre-pandemic levels and in normal situations you might think that the fed would be talking about an interest rate hike right now and you point out it's 32 months the other statistic that i saw you point out was and i don't have it right here but the amount of of asset purchases that the fund has or that the fed is orchestrated just in in a very brief period of time it eclipses what we did through the whole financial crisis for the seven eight years after the financial crisis what is that in six weeks last spring um we did more qe more more purchasing treasuries than we did the entire time the nine year period from 2009 to 2018.
frankly joe i don't have a problem with that we were in a black hole no one knew where we were headed what i have a problem with is the fed is expected to do two and a half trillion of qe after after vaccine confirmation and after retail sales um reach trend and we're above trend so the the the black hole didn't occur that's wonderful we're all happy but we're still acting like we're in a black hole in fact uh the economy accelerating could your producers bring up the chart of retail sales is that possible yep i think we yeah we've got them all ready uh that we can bring up there there it is i think it's up now us nominal retail sales okay so if you look at this this is a chart of retail sales the last 20 years and as you can see they grow about three percent a year and after the last the great financial crisis it took about six years to get back to trend if you look at the current recession it's like nothing we've ever seen a sharper decline but then within six months you were back to to trend level and you see check one that's the first stimulus package that's the one i have no problem with i think it was the right risk award which was right at the bottom but look at check two and check three when they're coming not only are we back to trend we're now 15 above trend to put that in perspective retail sales grow at about three percent a year so we are five years worth of demand above trends there's some pull forward here away from travel but it's not 15 so when you look at this chart and then you look at the fed policy and all the stimulus and them talking about the hole we're in i just think it's totally inappropriate let's talk about the dollar and 85 percent of the transactions are still done in in the dollar you pointed out in a recent speech that you think we've crossed the rubicon are you comfortable saying with what you said there that that for the first time in your career you think we lose reserve status at some point i'm comfortable with it that's my central case as you know joe i can change my mind but yeah um you said that to some extent the fed is enabling the fiscal transfers it's not to some extent they couldn't be doing this without the fed the fed is monetizing their activity i mentioned all the qe after vaccine confirmation and retail sales we've had 850 billion of direct transfers 575 billion of them came after retail sales were above trend 575 of the 850 billion i'm old enough to remember the the bond market vincent lannies i used to be one of them without the fed buying i don't know what the exact number is i think it's 60 percent of all the debt issued that the bond markets would be totally rejecting this so they are enabling this massive expansion in fiscal policy and the problem is if you end up getting inflation and frankly even if you don't the debt is going to be so big you remember i did my entitlement talks eight or nine years ago that's all happened except for one thing the interest rate level so we're right now in the corrupts of when the demographic when the baby boomers accelerate in terms of of getting medicare medicaid social security that stuff right as we're doing that we just put six trillion of new debt on again all enabled by the fed these guys could not be doing it bond rates would go to a prohibitive level so my my issue here is in the future um as we go forward if you look at you have chart five up there let's get it i think we can do it uh which one uh it's federal spending social security major health care programs federal spending percent of gdp this is the cbo this is not me okay and they're saying if 10 years go to 4.9 which is their normalized projection the interest expense alone will be close to 30 percent of gdp every year that's basically what we just spent on the covert emergency in the last year there is no way we can afford to have 30 percent of all government outlays be be toward interest expense so what will happen is the fed will have to monetize that when they monetize it um i believe it'll have horrible implications for the dollar and that's why i said in that speech yes that i think it's more likely than not within 15 years we lose reserve currency status can we go to the chart on the dollar specifically because i think this is really important last spring in the midst of an equity market meltdown and i've been trading for 40 years and i've never seen anything like this right in the middle of an equity market meltdown the bond market went down 18 points one day and everybody thought it was macro traders like me and others that were rejecting the the implications of the cares act the fed did a deep dive and by hindsight foreigners sold a trillion dollars a trillion of treasuries overnight as we were proposing the cares act they've continued to sell treasuries ever since then why is that important because for 20 years treasuries have been the go-to asset of foreigners to hedge global portfolios with in every case whenever you had a problem in the equity market or in the world economy they fled to treasuries and they fled to the dollar last spring that was violated so since then they've continued to sell treasuries so what we've gone from is for 20 years an average flow of 500 billion a year into treasuries from an outflow out of treasuries uh so when you have a 700 billion dollar current account deficit our estimate for the year you need capital to flow in to offset that if you just erase 500 billion inflow and turn it into an outflow you see the pressure will put on the dollar a reasonable person might ask well if that's true why did the dollar not go down from march to july very simple um who was the biggest beneficiary of coven obviously the massive digital transformation companies google microsoft not so massive but zoom those kind of names what country dominate in terms of those names the united states of america so the 500 billion dollar outflow out of bonds was offset by a massive inflow from from world central banks from sovereign wealth funds into our equity market by july they had become that had become pretty much in the market the relative prices had gone up and frankly the vaccine profile was starting to look better so that is when the dollar peaked as that offset started to diminish and as you know joe the vaccine tends to cause a rotation out of growth stocks into value stocks our big advantage over here are the growth stocks so that's why i think the pressure on the dollar is going to continue
Comments 0