Billionaire investor Ron Baron says he’s never owned bonds and almost never holds cash – ‘I’m always investing’

Ron Baron warns that inflation will inevitably cut the value of money in half every 15 years.CNBC

  • Billionaire investor Ron Barron says he has never owned a government bond before.

  • He said this was caused by rising inflation and rising U.S. debt.

  • Barron’s estimates that inflation could cut the value of money in half every 15 years.

Billionaire investor Ron Barron said he has never owned bonds before and is investing cash amid inflation and the growing size of the U.S. debt.

exist Interview with CNBC on FridayThe Barron Capital chairman said he is “very optimistic” about the market and is buying assets “every day.”

But he then pointed to the impact of government spending and borrowing on inflation and the ability to repay debt.

“The way they pay it back is not that the government pays back any debt. They pay it back by devaluing your money,” he said.

He estimates that inflation must halve the value of cash every 14-15 years, since inflation accelerates by about 4%-5% per year over the long term.

When asked about buying bonds, Barron responded: “I’ve never owned bonds… and I don’t have a lot of cash. I’ve always invested. Every time I have an opportunity to buy more bonds, I buy more.” of.”

His avoidance of bonds comes at a time when federal deficits are ballooning and financial markets have less demand for new U.S. debt.

Thursday, a Treasury auctions $24 billion in 30-year bonds Investors responded mutedly, forcing primary dealers to fill the void and pushing yields higher. Treasury issuance weakened last month.

With deficits expected to remain large, Bank of America predicts that total public debt balances could rise to $50 trillion over the next 10 years from the current $33 trillion.

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