Hedge Fund Titan John Paulson Bullish On Bonds And Equities, Inflation Concerns Remain

The Market Oracle ^ | 12-9-2009 | Trade _Mark

Posted on Thursday, December 10, 2009 9:08:42 AM by blam

Hedge Fund Titan John Paulson Bullish On Bonds And Equities, Inflation Concerns Remain

Stock-Markets / Investing 2010
Dec 09, 2009 - 09:59 AM
By: Trader_Mark

John Paulson... super bull? Goodness. To some degree I find "whale watching" a bit overrated, but after being the most obvious winner of the mortgage meltdown, and then piling into gold ahead of a huge run ... Paulson's moves are watched by the investment world very closely.

One of the hottest investors on the planet is now chock full of bonds - especially the moral hazard kind (i.e. backstopped by US government). And has his highest net long exposure in "a long time".
No one will be correct forever, but it does make you stand notice...especially since his success is based on actually making big macro calls rather than building an army of computers co-located as close as possible to a stock exchange, so he can surge ahead of your order by 4/1000ths of a second to make mad money. Via Reuters:

Billionaire hedge fund manager John Paulson said on Tuesday he still sees compelling long-term returns in equities even after their sharp run-up this year, while holding no short positions in the credit markets.
"Today our net long exposure is perhaps the highest it has ever been in our portfolio," Paulson said during a luncheon presentation at the Japan Society.
Paulson, who has run his own hedge fund since 1994, has become a star investor after correctly predicting the sub-prime credit crisis in 2007. That reaped him a $3 billion profit.

[snip]

* Even as credit and equity markets looked attractive, he did reiterate his concerns that over the long-term inflation will be a problem because the government's mountain of stimulus cash will be difficult, politically, to withdraw from the economy.

* "Therefore we are concerned about high rates of inflation in the future. As an investor I became very concerned about having my assets denominated in U.S. dollars," he said.

[snip]