1/11/2021
What Do Bill Ackman, Ray Dalio and Paul Tudor Jones Predict for 2021?
CMC Markets (01/11/21)
Most analysts and investors agree the markets will pick up as vaccinations make it possible for life to return to normal, but not before the second half of the year. Bill Ackman, CEO of Pershing Square Capital Management, goes so far as to suggest major companies could see their share prices rise higher than before the virus hit, because they could have an even bigger market share. He believes the virus will continue to be “a fright and a disaster” for the first three or four months of the year. Then, with the accelerating distribution of Covid-19 vaccines and the release of pent-up “animal spirits,” Ackman suggests businesses and their consumers will be raring to travel and spend as we head into summer and beyond. All of which, added Ackman, is even better news for well-capitalized major organizations where the pandemic has driven many of their smaller competitors out of business. Jason Donville, CEO at Donville Kent Asset Management, agreed that vaccines plus pent-up demand would lead to a period of “super-growth” in the early summer. Tudor Investment Corp. CEO Paul Tudor Jones believes retail stocks will come good in the second half of 2021, while a continued combination of financial stimulus, low-interest rates, and the vaccine shot will boost shares across the board. Ray Dalio’s Bridgewater Associates endured an even worse 2020 than many of its rivals after admitting it kept missing opportunities to reposition. Dalio doesn’t doubt the economy will recover, but warns of the longer-term fall-out for companies of reduced productivity. Dalio said longer-term recovery from the Covid-19 crisis is more likely to be impacted by an imperfect storm of the United States' worsening inequality, political polarization, and mounting debt, all of which he says are at extreme levels not seen since just before the Great Depression. The evolution, Dalio says, is that of “three big forces underway”: gaps in wealth and politics, the production of debt and money by central banks, and the rise of China as a new world power. “If we don't have broad productivity and employment, we're going to have a continuation of the worsening, greater polarity," said Dalio.
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