Hedge fund billionaire Paul Tudor Jones says he’s eyeing Bitcoin (BTC) and gold as geopolitical conflicts and the likelihood of a recession increase.
In a new CNBC interview, the legendary investor says that he is favoring BTC and the precious metal as he anticipates economic trouble ahead that could send equities into an ugly correction.
“I would love gold and Bitcoin together. I think they probably take on a larger percentage of your portfolio than historically they would because we’re going to go through both a challenging political time here in the United States, and we’re going to go through – we’ve obviously got a geopolitical situation.”
Jones says investors will likely pour at least $40 billion into gold as recession approaches, and that Bitcoin also may have a place in cautious portfolios.
“More likely than not we’re going to go into a recession. There’s some pretty clear-cut recession trades. The easiest are: the yield curve gets really steep, term premium goes into the backends of debt markets, into 30-year and 10-year and 7-year paper. The stock market typically – right before a recession — declines about 12%. That’s probably going to happen at some point, from some level. And you look at the big shorts in gold, more likely than not in a recession, the market’s typically really long…
There’s probably $40 billion worth of buying that has to come into gold at some point between now and if that recession actually occurs. So, yes, I like Bitcoin and I like gold right here.”
The Tudor Investment Corporation founder says a recession will likely occur in the first quarter of next year due to the Federal Reserve’s hawkishness and the rising yields on long-term U.S. Treasury bonds.
“So, what’s happening is and why we’re probably going to go in a recession sometime in the first quarter of next year, probably because the bond market, simply through supply-and-demand, is going to deliver more rate hikes because we don’t have a clearing price yet for long-term debt. And so, those rate hikes are probably going to tip us into recession.”
Bitcoin is trading for $27,444 at time of writing, up 0.3% in the last 24 hours.
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