Ken Griffin’s 2020 financial crash view is based on the longest secular bull market in history abruptly ending sometime between 18 to 24 months.

Ken Griffin, CEO of the hedge fund firm Citadel (1990) with $27 billion in assets under management, has joined a growing number of heavyweight money managers firing off distress flares.

David Tepper’s has recently warned of a 20% stock pull-back, Warren Buffett’s famous indicator (known as the Market Cap to GDP ratio) is flashing red and Jim Rogers sees the next bear market will be the worse in our lifetime.

“Ken Griffin, CEO of the hedge fund firm Citadel (1990) with $27 billion in assets under management, has joined a growing number of heavyweight money managers firing off distress flares”

 

Ken Griffin’s 2020 financial crash is based on the end of this “artificial “binge”

Put another way, the winding down of the Fed’s accommodative monetary policy which pumped trillions of dollars into the financial system through its bond purchasing activities, known as quantitative easing QE will be the death nail of this artificial bull market.

If there is a silver lining to Ken Griffin’s 2020 financial crash forecast it is that price discovery rather than the Fed’s currency creation will sow the seeds of the next great bull market cycle. If so, that would be a positive move back to normality, price discovery will determining asset prices again.

“the Fed’s accommodative monetary policy which pumped trillions of dollars into the financial system through its bond purchasing activities, known as quantitative easing QE will be the death nail of this artificial bull market”

 

But why is Ken Griffin’s 2020 financial crash forecast approximately 18 to 24 months and not now?

Here is the good news for those investors who believe that this aging bull market still has legs, the current Trump administration has unlocked “animal spirits,” according to Ken Griffin. But those “animal spirits” are all American.

The US corporate tax cuts have repatriated more than $350 billion in profit and that is great news for American productive capital but not so good for (British) offshore tax-havens and their cheap source of capital for speculative activities. The US tariffs on EU and China will spur American manufacturing but that will be to the detriment of other major global manufacturers such as China and Germany. So those “animal spirits” are all stars and stripes and that is precisely why I believe we will see this continue divergence in the performance of US stocks, US assets with the rest of the world.

However, while the Trump administration could be winning at home it is also creating powerful enemies (financial elites and foreign industrial class) abroad and that could throw up many wild cards.

“My position today is very much focused on managing the tail risks for that… we are late in the cycle, the animal spirits have been unleashed and when these corrections occur they happen with very little notice” – Ken Griffin

So Ken Griffin’s 2020 financial crash forecast underpins the billionaire investor’s strategy going forward.

Indeed, Ken Griffin admitted that he’s already managing his fund for the next economic downturn. “My position today is very much focused on managing the tail risks for that… we are late in the cycle, the animal spirits have been unleashed and when these corrections occur they happen with very little notice”, he said.

Ken Griffin’s 2020 financial crash video.

TRADING SOFTWARE

Dan Loeb targets Sony. Dan Loeb is an activist investor and founder of Third Point, which oversees about $14.5 billion in assets.

Last year the activist investor viewed Campbell soup as a bargain when Third point reported that the soup maker could fetch a takeover value of $52 to $58 per share.

A year later and the activist investor Dan Loeb targets Sony

Dan Loeb's activist hedge fund Third Point is raising an investment vehicle to generate between $500 million and $1 billion so it can continue to buy Sony shares, according to a recent report in Reuters.