Billionaire hedge fund manager Paul Tudor Jones II recently shared his investment strategy, revealing that he is heavily invested in both gold and Bitcoin. Jones explained that he believes inflation is inevitable, regardless of the outcome of the 2024 US presidential election. During an interview on CNBC’s “Squawk Box,” Jones expressed his confidence in his portfolio’s ability to withstand rising prices.
Jones stated, “I think all roads lead to inflation. I’m long gold. I’m long Bitcoin. I think commodities are so ridiculously under-owned, so I’m long commodities.” He also commended Bitcoin for its performance during the economic uncertainty caused by the pandemic in 2020. Jones emphasized that he remains bullish on Bitcoin, and his firm has taken significant long positions on the cryptocurrency.
One of the driving factors behind Jones’s trading strategy is his expectation that former President Donald Trump will win the US elections in November. The price of gold recently hit a new all-time high of $2747.40, marking a 37% increase this year. Meanwhile, Bitcoin is currently priced at $67,154.65, reflecting a 52% increase in 2024, according to data from CryptoSlate.
Jones highlighted the trend among young investors who are turning to inflation hedges like Bitcoin and tech-heavy investments such as the Nasdaq during times of market uncertainty. He expressed concerns about the US attempting to inflate its way out of mounting debt, a strategy that has been seen in other heavily indebted nations throughout history.
The Congressional Budget Office (CBO) projects that deficits will continue to rise, reaching $2.8 trillion by 2034, up from $1.8 trillion in fiscal 2024. US debt is expected to reach 122% of GDP by the same year. Jones believes that the proposed tax cuts and spending from both major political candidates will contribute to inflation and lead to higher interest rates.
Given his outlook on inflation, Jones stated that he has no plans to hold fixed-income assets, and he is actively shorting the back end of fixed income. He believes that fixed-income assets are currently priced incorrectly, given the inflationary pressures at play in the market.
In conclusion, Paul Tudor Jones II’s investment strategy reflects his confidence in gold and Bitcoin as hedges against inflation. His approach is driven by his belief that inflation is inevitable, regardless of political outcomes, and he is positioning his portfolio accordingly to navigate the challenges of rising prices.