Spend some time over the weekend listening to Hugh Hendry and David Einhorn, who were participating in the Economist’s Buttonwood Gathering this week.
Nice to hear from some non-cheerleaders. Smart and provocative.
Hendry is very bearish on the creditor nations of Asia — China and Japan. Money quotes:
We are in the death spiral of mercantilism…
The creditor nations in Asia have to short their own currencies…My fear, at the end, you get a short squeeze…
I go to Japan…It’s hard to believe equities and properties have fallen 80 percent over the past twenty years…
The impossible is happening today in Japan. Some of the largest Japanese corporates are on the verge of bankruptcy…
Sandwiched between Hendry and Einhorn is a great discussion on China.
Greg Ip interviews David Einhorn about 56 minutes into the video. Einhorn is very critical — as we are — of current U.S. monetary policy. Money quotes,
…We at the point where incremental easing is slowing down the recovery…
…the lower rates drive up the cost of commodities… it takes income out of people’s pockets…
…not being able to earn a safe return on savings is causing people to hoard savings rather than consume…
Click here for full interview
Right on, David.
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