Paul Singer Says “Everyone Is In The Dark”; Warns Of “Sudden, Intense Market Breakdown”

Thursday, August 18, 2016
By Paul Martin

by Tyler Durden
Aug 18, 2016

While there have been some very prominent recent entrants into the billionbear club, such as BIll Gross, Jeff Gundlach, Carl Icahn and George Soros, who only recently switched from being bullish on the market to predicting gloom, one name has been a staple when it comes to warnings about the disastrous consequences of the new normal’s monetary policy: Elliott Management’s Paul Singer.

And, sure enough, in his latest letter he does not disappoint, dispensing with his usual dose of what Kate Kelly calls “bleakness”, warning that the bond market is “broken”, and when the unprecedented central bank actions of recent years can no longer prevent a market decline – which considering that both the BOJ and ECB are running out of monetizable bonds may be sooner than many expected – “the subsequent loss of confidence could be severe.”

As Singer admits in Elliott’s Q2 letter to investors, what the fund, up 6% YTD, is seeing, is “the most peculiar period we have faced in 39 years.” The details are familiar to those who have read Singer’s previous laments (most recently here) on central planning: too much central bank power, too much monetary debasement, inevitable inflation, and “when it happens it could be swift and impossible to tamp down.”

Not surprisingly, Singer touches on a very popular topic in a world of nearly $14 trillion in negative yielding bonds, namely the scramble for safety, and surprised by the “continued stampede” to buy such bonds, he says that today’s environment marks “the biggest bond bubble in world history”, leading him to declare that “the global bond market is broken.”

The Rest…HERE

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