Odd Lots Bridgewater's Greg Jensen on Why Markets Have Further to Fall
17 snips
May 23, 2022 Greg Jensen, co-chief investment officer of Bridgewater Associates, shares his insights on the current turbulent market landscape, marked by high inflation and rising interest rates. He discusses the toxic mix of inflation and slowing growth, explaining why market prices remain overly optimistic. Jensen dives into complexities like stagflation, the delicate balancing act for the Federal Reserve, and the need for adaptive investment strategies. He also highlights the evolving dynamics between stocks and bonds amid deglobalization, urging listeners to rethink traditional portfolio approaches.
AI Snips
Chapters
Transcript
Episode notes
Bridgewater's Core Frameworks
- Bridgewater uses two core frameworks: discounting the future and understanding buyers and sellers.
- These frameworks help predict market changes and apply to various economies throughout history.
AI and Machine Learning at Bridgewater
- Bridgewater uses AI expert systems, translating human insights into algorithms for trading.
- Machine learning has limitations in economics due to small sample sizes and changing market dynamics.
Inflation Dynamics
- COVID accelerated the use of fiscal and monetary policy, creating demand without matching supply, leading to inflation.
- This inflation is sticky due to a wage-price spiral, diverging from the patterns of the last 40 years.