A 'Black Swan' investor warns of an epic debt bubble - and says stocks are overvalued and set to plunge
. He predicted steeper borrowing costs would hinder economic growth, force governments to restrict their spending, and lead to central banks keeping interest rates lower then they'd like.
Universa's founder and chief investor also panned the Fed for cutting rates to almost zero and buying excessive amounts of bonds during the COVID-19 pandemic. The central bank's loose monetary policy may have staved off a recession, he said, but it also drove up asset prices and debt levels to dangerous highs — paving the way for a much bigger disaster down the line..
, as evidence that valuations are stretched. He also recommended retail investors avoid betting against the market or stocking up on haven assets like gold or US Treasuries to weather a downturn, as he views their own rash decisions such as panic-selling as a greater risk to their portfolios.to invest in a low-cost, broad index fund like a S&P 500 tracker. Given the legendary investor and Berkshire Hathaway CEO's endorsement, Spitznagel said, it's"probably pretty good advice.
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