But for Mark Spitznagel, founder and CIO of the private hedge fund Universa Investments, all of these ideas are merely attempts to find a story to explain how “it’s different this time,” when the reality is that history tends to repeat itself, or at least rhyme.
“It’s not different this time, and anybody who says it is really isn’t paying attention,” Spitznagel said in an interview with Fortune, adding “the only difference is the magnitude of this bubble that’s popping is bigger than we’ve ever seen.”
Spitznagel has claimed for years now that the Federal Reserve helped blow up the “greatest credit bubble in human history” with years of loose monetary policy—and he’s warned that all bubbles eventually pop, giving him a reputation as a perma-bear that he’s tried hard to shake.
Even now, with most Wall Street experts turning bullish this year, the veteran hedge funder is worried about the economy. He believes the negative impacts of the Fed’s monetary tightening in a period with elevated levels of corporate, consumer, and government debt have simply been delayed.
Government spending and debt are on an unsustainable course but the market bubble might be less than it appears.
The DJIA closed at about 40,660 on Friday — up almost a third from the last day of trading in 2020, when it was 30,606. But inflation has depreciated the dollar by about 20% since the end of 2020, which makes Friday’s DJIA 32,528 in constant dollars.
A 6% return after more than 3.5 years is nothing to brag about but you can bet Harris-Walz will be doing just that.