Influencer and hedge fund manager Ray Dalio gave his thumb’s up to equity markets, referring to a goldilock (perhaps also synonymous to bubble) economy and a beautiful deleveraging as he also suggested central banks to let it (nascent inflation) go a little further to allow the bull market to enter its last phase... the melt up mode. He suggested central banks to not break the camel’s back which he sees at around 4% interest rate. When asked when to pull out of stocks, he said ...”that is my game”. Our advice: Make sure it is yours as well! Interestingly, bonds, stocks and gold all rallied together which is unusual and emblematic of melt up conditions already (looking at a chart of the s&p vs. its 10 y bull trend.... this is evident). Bonds were strong from the morning, supported by BoJ pushing back on the mere suggestion it might be about to start normalize interest rates likely out of fear of triggering a JPY rally (in a particularly weak dollar context) or a bonds selloff that would rapidly cause fiscal problems. That is a fertile ground for the gold complex, both bullion and stocks because inflation might be knocking at our door...
Below is thw way we like to be positioned right now on a tactical basis.
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