Billionaire hedge fund manager Paul Tudor Jones says he loves bitcoin. Noting that he can rely on math, the famous hedge fund manager said, “Bitcoin appeals to me because it’s a way for me to invest in certainty.” Jones also shared his investment strategies in response to the Fed’s policy.
Paul Tudor Jones on Bitcoin, Fed Policy, Inflation
Paul Tudor Jones, the founder of asset management firm Tudor Investment Corp., explained to CNBC on Monday why he loves bitcoin. He told me:
I like bitcoin. Bitcoin is mathematics and mathematics has been around for thousands of years. 2+2 is going to equal 4 and it will be for the next 2,000 years. Therefore, I like the idea of investing in something that is reliable, consistent, honest and 100% sure. Therefore, bitcoin appeals to me because it is definitely a way for me to invest.
“I look at the difference between the Fed in 2013 and the Fed in 2021… I look at the difference between Trump and Biden,” Jones said. “Do I want to believe in human nature and have the same credibility and consistency?”
Asked if he likes bitcoin at its current price, Jones replied:
I prefer bitcoin as a portfolio diversifier… the only thing I know for sure is that at the moment I want to hold 5% in gold, 5% in bitcoin, 5% in cash, 5% in commodities I am
The famous hedge fund manager admitted, “I don’t know what I want to do with the other 80%.” “I want to wait and see what the Fed is going to do because what they do will have a big impact.”
The 5% allocation is a significant increase from their earlier allocation of between 1% and 2% that they revealed last year.
He further shared, “I have a defensive position in bitcoin to protect myself, my family, and my wealth over time.” He also said that he no longer watches the price of bitcoin, which means he is a trader.
Jones also offered his thoughts on inflation and the upcoming Federal Reserve meeting. He said the Fed meeting this week could be the most important meeting in Chairman Jay Powell’s career, and “certainly the most important Fed meeting of the last four or five years.” Clarifying why the meeting is so important, he said:
This is because we have so much incoming data that challenges both their mission and their model. So how they react to that will be extraordinarily important and I think for investors how they should deal with their portfolio going forward.
Jones explained that consistent consumer price index readings put price pressure well ahead of the Fed’s 2% inflation target. However, Fed officials have been emphasizing that the current readings are tentative and are unlikely to last. Jones disagreed, emphasizing that “this is an intellectual anomaly that risks damaging his forecasts on inflation if they are wrong.”
Referring to recent economic data showing higher consumer prices, Jones said: “If they [the Fed] Treat these numbers, which were physical events, they were so physical, if they deal with them casually, I think it’s a green light to bet heavily on every inflation trade. He further opined:
If they say, ‘We’re on the way, things are good,’ then I’ll just go into the inflation business. I would probably buy commodities, buy crypto, buy gold.
Jones, on the other hand, predicted: “If they’re certainly right, if they say, ‘We’ve got the data coming in, we’ve accomplished our mission or we’re too fast to accomplish our mission at employment’. are on the way from,’ then you’re going to have a taper tantrum.” He concluded: “You are going to get a sell-off in a fixed income. You are going to get correction in shares. That doesn’t mean it’s over. “
What do you think of Paul Tudor Jones’ comments on bitcoin and Fed policy? Let us know in the comments section below.
image credit: Shutterstock, Pixabay, WikiCommons
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell any products, services, or companies, or a recommendation or endorsement of any products, services or companies. bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the Company nor the author is responsible, directly or indirectly, for any damage or loss alleged to be caused by or in connection with the use or reliance on any materials, goods or services mentioned in this article.