Apr 14, 2020
David Hunter, chief macro strategist at Contrarian Macro Advisors, has for some time predicted a final "melt up" stage of the market cycle before markets crash.
This stage is now underway as markets recover from an initial sell-off caused by the coronavirus (which Hunter admits he did not and could not have predicted).
What comes next is a "secular top that I expect to be the high-water mark for decades to come," he says. After markets peak around late summer, a "global deflationary bust" will ensue, with as much as 80% downside for equities.
Content:
(Spotify users can click on the timestamp to link to the segment
directly):
- Target of 4,000 for the S&P as part of "the final melt up" (2:23)
- The downside target. Forget the "reset narrative" in the short term (10:39). Markets should drop by 80% from the top (11:58)
- Unprecedented leverage doesn't leave policymakers much time (14:09)
- Background on David: 47 years in financial markets (18:46)
- The current crisis in historical context (26:35)
- Deflation allows for liquidity injections. Until it creates inflation (32:01)
- Discussing the potential political and social fallout from the coming economic crisis (36:12)
- How deflation will eventually turn to inflation (40:20)
- Discussion of the U.S. dollar's reserve currency status (45:56)
- Bullish outlook for gold and silver (51:37)
For more information on the guest:
- Twitter: @DaveHContrarian
Not intended as investment advice.