Billionaire hedge fund manager Paul Tudor Jones II revealed he is investing heavily in gold and Bitcoin (BTC) as he expects inflationary pressures to persist regardless of who wins the 2024 US presidential election.
Speaking on CNBC’s “Squawk Box” on October 22, Jones emphasized his belief that inflation is inevitable and explained that his portfolio is now positioned for rising prices. He stated:
“I think all roads lead to inflation. I’m tall gold. I am long Bitcoin. I think commodities are so ridiculously under-owned, so I’m long commodities.”
He also praised Bitcoin’s performance during the pandemic-induced economic uncertainty in 2020. He added that he remains “long” on Bitcoin, and that his firm has also taken long positions on the flagship crypto.
Jones said his trading strategy is driven in part by expectations that former President Donald Trump will win the U.S. election in November.
Gold prices hit a new all-time high of $2,747.40 on October 22, marking an increase of over 37% this year. Meanwhile, BTC costs $67,154.65 as of now, up 52% by 2024, according to data from CryptoSlate.
Jones highlighted that many young investors have sought inflation hedges through tech-intensive investments like Bitcoin and the Nasdaq, a strategy that has been successful amid market uncertainty.
Avoid fixed income
Amid inflation fears, Jones believes the US will eventually try to dig its way out of mounting debt, mirroring the historical developments of other heavily indebted countries.
The Congressional Budget Office (CBO) projects that deficits will rise to $2.8 trillion by 2034, up from $1.8 trillion in fiscal year 2024, with U.S. debt expected to reach 122% of GDP by the same year.
Jones believes the proposed tax cuts and spending from both major political candidates will further fuel inflation and lead to higher interest rates.
The billionaire is therefore not optimistic about holding fixed income assets and states:
“Obviously I will not own fixed income, and I will be shorting the back end of fixed income. Because it’s just the wrong price.”