S&P 500 has recovered from the plunge in the beginning of 2016. Many famed hedge fund managers published their own view on the stock market, and who has been right so far? We would like to review the predictions by great investors such as George Soros, Ray Dalio and Bill Gross.
The global deflation and low economic growth are the keys to investment in 2016. The weak demand from the decelerating Chinese economy has pushed down the commodity prices, and Europe and Japan are still struggling to recover from the recession.
- The commodity market crash leads to worldwide deflation: gold, crude oil, natural gas, copper and iron ore
Even the US economy has a symptom of a slowdown now, indicating it cannot support the rest of the world economy alone.
- 2015 4Q US GDP: the slowdown of the US economy becomes clearer, the exports sink due to the strong dollar
The advanced economies have already relied on the quantitative easing, and if even the QE cannot revive the economies, what would be the cause of such a strong deflationary force? Larry Summers, the former Treasury Secretary, called it secular stagnation.
Bill Gross, a famed bond fund manager of Janus Capital, explained in the Twitter account of Janus Capital about how to trade in the very volatile stock markets.
Earlier this year, Mr Gross also successfully predicted the bear market in German bonds and the plunge of the Chinese stocks. He is without a doubt one of the greatest investors who correctly understand the market situation before the Fed’s rate hikes, the opinion of whom is worthwhile to follow.