Billionaire hedge fund manager Paul Tudor Jones expressed concerns about the stability of financial markets during President Donald Trump’s second term. In an interview with CNBC, Jones pointed out significant changes in the fixed income, foreign exchange, and equity markets over the past eight years.
The Treasury is now issuing a record amount of debt, more than double the figure in 2017. Foreign ownership of U.S. equities, debt, and real estate has also doubled as a percentage of GDP since 2017. Jones warned that a 30% correction in the stock market would only bring it back to being slightly overvalued.
Jones noted that the average price-to-earnings ratio of the S&P 500 is currently around 25, compared to 19 in January 2017. He expressed caution, stating that the current macroeconomic situation is precarious and will require careful management to maintain stability in major asset classes.
Jones’ warning comes at a time when the financial landscape is undergoing significant changes, with the Treasury issuing record amounts of debt and foreign ownership of U.S. assets increasing. The imposition of tariffs by Trump has already caused market fluctuations, and any further instability could lead to a significant market correction.
Source: https://in.benzinga.com/markets/25/02/43756824/market-instability-looms-in-trumps-second-term-warns-paul-tudor-jones-theres-no-room-for-mistakes