Billionaire Paul Tudor Jones said that the Federal Reserve is done raising rates and that stocks will end the year higher even as the economy slows.
(Bloomberg) — Billionaire Paul Tudor Jones said that the Federal Reserve is done raising rates and that stocks will end the year higher even as the economy slows.
The Fed “could probably declare victory,” said Jones, founder of Tudor Investment Corp., in an interview on CNBC. He added that inflation has been declining for 12 straight months and “that’s never happened before in history.”
Even though Jones said the economy could enter a recession in the third or fourth quarter, he’s expecting that stocks will end the year higher.
“I’m not rampantly bullish because I think it’ll be a slow grind,” he said, comparing the period to June 2006, when the Federal Reserve stopped raising rates and stocks rose for another year.
Jones is forecasting a multi-year trading range, much like his fellow billionaire Stan Druckenmiller, and he agrees with the Duquesne Family Office founder that AI will lead to a bifurcated market of big winners and big losers.
“I do think that the introduction of large language models, artificial intelligence, is going to create a productivity boost we’ve only seen a few times in the last 75 years,” he said, adding that it could add a 1.5% gain in output a year for the next five years.
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