John Paulson: Sell Bonds; Buy Stocks; Double Digit Inflation Coming

Sep. 27 2010 - 4:22 pm

It could be time to sell your low-yielding bonds and replace them with higher-yielding common stocks.

Multibillionaire hedge fund operator John Paulson, the investment genius who made a killing going short subprime mortgages a few years ago, told a standing room only crowd at New York’s University Club that double-digit inflation is about to rear its ugly head by 2012, killing the bond market, and restoring strength to equities and gold.

Paulson’s warning to sell U.S. government bonds is one of the latest signs that the most successful investors of this generation believe the run up in bonds is over. Paulson especially underscored the attraction of equities with earnings yields of 7%-8% compared to the 2.6% pittance available on 10-year Treasuries.

Paulson listed his favorite blue-chip stocks; JNJ (Johnson& Johnson) at a 3.8% yield; KO(Coca Cola);PFE, 4% yield., as well as C (Citigroup), BAC (BankofAmerica) and STI (Suntrust Banks) and RF (Regions Financial).

Paulson is a pro at buying the distressed bonds of bankrupt companies, and then converting the debt to equity in reorganization and benefiting from the potential run up. He mentioned one of his greatest plays — K-Mart, which emerged from bankruptcy at $10 a share and then skyrocketed to $190 a share.

His crystal ball is for 2% GDP growth for 2011 and 2012 and he warns that the Fed’s promise of quantitative easing should contribute to double-digit inflation over the next few years.

As this is the best time in 50 years to buy homes, Paulson advised his listeners, crowded into 3 separate dining rooms, to issue 30 year mortgages to buy a home as “your debt and interest payments get locked in at record lows, while the price of your home will rise.”

“If you don’t own a home buy one,” Paulson recommended; ” if you own one home, buy another one, and if you own two homes buy a third and lend your relatives the money to buy a home.”


「ジョン・ポールソンの過激なご託宣」 2010年9月30日
いまやカリスマ・ヘッジファンドとなったポールソンがＮＹ大学クラブの集まりで語ったことがネットで広がって話題になっている。かなり過激な内容で、結論からいうと、量的緩和政策の後遺症で米国は２０１２年に二桁のインフレとなる。投資家は年率２.６％程度の米国債は売り払って、株や金で保有すべき。株なら年率７－８％は見込めるという。
株の推奨銘柄は、ジョンソン＆ジョンソン、コカコーラ、ファイザー、シティーグループ、バンク・オブ・アメリカ、サントラスト・バンク、リージョン・フィナンシャルなど。
また、住宅購入も５０年に一度の好機だから、３０年の住宅ローン組めと言う。金利は歴史的低水準で固定しておけ。住宅価格は上昇する。マイホームの無い人は、ここで一戸買っておけ。すでに一戸持っている人は、もう一戸買いなさい。二戸持っているなら、三戸目を買って、さらに親類にマイホーム購入資金を貸し付けなさい、と。
そして金価格は、金融緩和で２４００ドル、オーバーシュートして４０００ドルと予測。ちなみに、彼の資産の８割はドル建てではなく金建てという。