Hedge fund manager Bill Ackman is betting on the economy’s comeback, saying that not even the Delta variant of the coronavirus will derail it. This according to a recent article in Chief Investment Officer.
Regarding the new strain of the virus, Ackman said, “I don’t think it’s going to change behavior to a great extent. You are going to see a massive, in my view, economic boom. We are going to have an extremely strong economy coming in the fall.”
Ackman argued that the new variant is less deadly than other strains and that the U.S. could reach herd immunity more quickly as people recover from it. Regarding the investment landscape, he predicts that bond yields will rise in the second half of the year, and that represents a buying opportunity today: “I would borrow as much as you can in the long-term fixed rate on the basis of today’s rates.” He expects short rates to rise faster than people anticipate, noting, “Coming to the turn of the year, I think we are going to have meaningfully higher yields as people realize the economy is going to make a big recovery.”
But not everyone agrees, the article notes, citing a Wall Street Journal survey of economists in which participants said they expect economic growth to start cooling.
Ackman, however, is reportedly moving heavily into recovery stocks, including hotels, restaurants, and retail.
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