Gundlach, Chanos Criticize Fed

Feb 21 2014 | 10:59am ET

The Federal Reserve may have some fans in the hedge fund community, but they are not nearly so vocal as its detractors.

The central bank's stimulus programs helped stoke last year's big gains on Wall Street. They are also, as Duquense Capital Management founder Stanley Druckenmiller has pointed out, much better for the rich than for the middle-class and poor. Still, some of the rich are not especially appreciative.

"I don't really like the Fed very much," DoubleLine Capital's Jeffrey Gundlach told The New York Times. "I wish the Fed were not manipulating the market the way it is."

One of the Fed's cheerleaders is Bridgewater Associates' Ray Dalio, who has said that the stimulus programs have led to a "beautiful deleveraging." But Kynikos Associates' James Chanos says that is a mirage.

"The beautiful deleveraging has not happened," Chanos told the Times. "We are more leveraged as a society than we were in 2007, at the onset of the financial crisis."

"They've gotten themselves boxed into a corner," Gundlach says. "It is the same old game and we keep saying the same old things."


In Depth

Q&A: Star Mountain's Brett Hickey On Investing In 'The Growth Engine Of America'

Sep 22 2017 | 5:06pm ET

Lower middle-market companies form the economic fabric of the nation, but they can...

Lifestyle

CFA Institute To Add Computer Science To Exam Curriculum

May 24 2017 | 9:25pm ET

Starting in 2019, financial industry executives sitting for the coveted Chartered...

Guest Contributor

Don’t Overlook These 6 Hybrid Cloud Concerns

Sep 14 2017 | 6:27pm ET

Cloud-based technology solutions have made tremendous inroads into the alternative...