đșđž US elections could trigger a 'Minsky moment' bond market crash as Paul Tudor Jones bets on bitcoin: analysts
The U.S. elections could trigger a âMinsky momentâ crash for the bond market, analysts at Presto said, heightened by both candidatesâ âfiscal extravaganceâ and rising debt levels.
Renowned investor Paul Tudor Jones said he was bullish on bitcoin, gold and commodities amid the risk as âall roads lead to inflation.â
Analysts at trading and financial services firm Presto said the U.S. elections could trigger a âMinsky momentâ bond market crash, with implications for other assets like bitcoin.
Presto analysts Peter Chung and Min Jung made the warning following Paul Tudor Jonesâ interview with CNBC on Tuesday, in which the renowned investor said he was bullish on bitcoin, gold, commodities and Nasdaq stocks amid the risk.
âWith the US debt-to-GDP ratio rising from 40% to 100% in the last 25 years and likely to reach 124% to 200% in the next 10 to 30 years, the U.S. election could trigger âa Minsky momentâ where bond market wakes up to the problem and demands much higher compensation for funding the deficit (i.e. a bond market crash),â the analysts wrote in a report.
đž âAll roads lead to inflationâ
The risk of a bond market crash is heightened by both Republican candidate Donald Trump and Democrat Kamala Harrisâ promises of âfiscal extravaganceâ and rising government debt levels, Chung and Jung argued. Inflating their way out of the problem is the only solution, they said, echoing Jonesâ view that âall roads lead to inflation.â
During the CNBC interview, Jones, an American billionaire hedge fund manager and philanthropist known for his successful prediction of the 1987 stock market crash, also said he would own âzero fixed-income,â meaning no allocation to fixed-income securities, such as bonds, in an investment portfolio.
