Druckenmiller Urges Entitlement Reform To Keep Seniors From 'Stealing'

Mar 1 2013 | 11:33am ET

Stanley Druckenmiller has some harsh words for his fellow retirees: Stop stealing from your grandchildren.

The Duquesne Capital Management founder, who stopped managing outside money in 2010, has cast aside his reputation for media shyness to launch a campaign for entitlement reform. And, he warns, if he's not listened to, the U.S. will see a financial crisis that will put the last one in the shade.

Speaking on the day before $1.3 trillion in automatic spending cuts took effect, Druckenmiller, 59, said that the sequester is nothing compared to the ballooning costs of Social Security, Medicare and Medicaid.

"While everyone is focusing on the here and now, there's a much, much bigger storm that's about to hit," Druckenmiller told Bloomberg Television. "I am not against seniors. What I am against is current seniors stealing from future seniors."

Druckenmiller said that the growing number of retirees and the shrinking workforce were threatening to bankrupt the country, and urged young people to take action.

"Look at our young people who are obsessed with the environment," Druckenmiller said. "They are looking at the consequences of our actions 50 to 60 years from today."

"With the proper education and with proper voices out there, we could have 40 million kids marching down to Washington."

Druckenmiller acknowledges it won't be an easy fight.

"The seniors have a very, very powerful lobby," he said. "They keep getting more and more transfer payments."

Druckenmiller said he was compelled to abandon his usual taste for quiet in part because he felt he didn't do enough to warn about the financial crisis, which he said he predicted as early as 2005. "I had my 30 charts with colors and pictures and laid out for them why I though it was going to be a huge, huge problem from the U.S. economy and the U.S. financial system," referring to a speech he gave at the Ira W. Sohn Investment Research Conference on "all those silly instruments."

And he threw cold water on the current market rally, calling it unsustainable.

"The chances of this being a new bull market like 1982 aren't high because we're not attacking the crux of the problem, which is too much leverage and too much debt," Druckenmiller said. "I don't know the timing of when the markets will respond to this, but it will happen."


In Depth

Part II: Roubini Talks Risk, Recovery And The Threat Of A Triple Dip Recession

Oct 21 2014 | 12:41pm ET

In the second half of our interview with Nouriel Roubini, FINalternatives editor...

Lifestyle

Balyasny Pays Over $6M For Lakefront House

Oct 22 2014 | 10:29am ET

A venture headed by hedge fund manager Dmitry Balyasny just paid $6.2 million for...

Guest Contributor

Hedge Funds Weather A Data Management Perfect Storm

Oct 22 2014 | 12:28pm ET

From a regulatory standpoint, nearly every development since the crisis has placed...

 

Videos

Editor's Note

    Guidelines for Guest Articles

    Oct 22 2014 | 9:46am ET

    We are always looking for guest articles from hedge fund managers and buy-side firms.

    If you are interested in submitting a contributed piece for possible publication on FINalternatives, please take a look at the specs. Read more…

 

Futures Magazine

October 2014 Cover

Demeter: Family affair

David and James Hamman launched their fundamental Livestock and Grains Program in March of 2010 but it really was decades in the making.

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.