The CSQ Podcast – How to Survive in Today’s Bear Market
In the latest CSQ podcast, Circle Squared President & CIO, Jeff Sica reviews the current dismal state of the markets highlighting interest rates, earnings, and hedge funds.
- The market is currently in a surge-plunge scenario
- Markets are over valued and artificially inflated by The FED
- The current market celebrates bad news, due to its addiction and dependence on economic stimulus – the worse the news the more likely The FED will keep interest rates low – which creates a challenge because artificially low interest rates distort asset prices
EARNINGS:
- This quarter was horrendous from an earnings standpoint
- Sooner or later the law of diminishing returns comes into effect and stimulus no longer works – like Japan’s model
HEDGE FUNDS:
- Last year’s massacre with the liquidation of hedge funds was the worst we’ve seen
- Assets in hedge funds fell by $64 billion – which is where some of the selling is from
- Hedge funds charged big fees and under performed
- People won’t pay for hedge funds if they can’t beat the indexes