Wonderful interview with Howard Marks who runs Oaktree Capital stateside, its a great read and the key points I gather from it are:
- The level of economic activity, anecdotal as you describe, is not an indication of health in the future. It is an indication of health in the present. The question is, what are the implications for the future?
- So, what that says to me is that even the Fed and the central banks with all their powers can’t create inflation when they want to.
- With interest rates as low as they are, if you stick to totally safe investments you can’t make any money. So they are not thinking bullish but they are acting bullish.
Source: Business Outlook