John Malone says he’s buying hard assets like housing in bet on currency devaluation

John Malone of Liberty Media

Michael Kovac | Getty Images

Liberty Media president John Malone said the tough assets looked attractive as unprecedented coronovirus stimulation led to depreciation in currencies.

“We survived it [pandemic] Due to heavy fiscal and monetary stimulus, “Malone said in an interview that aired Thursday with CNBC’s David Faber.” And I believe that this will cause the devaluation of currencies, which will increase in value in hard assets … currency. I’m not sure I’m gonna call this inflation, but it will look and feel like inflation. “

To support the economy through the epidemic, the Federal Reserve slashed interest rates near zero and vowed to buy assets under its quantitative easing measures. Meanwhile, lawmakers passed a landmark $ 2 trillion coronavirus relief deal in March, which provided incentive checks and other aid measures to Americans.

“And I think we’re seeing it in housing. It’s an unreasonably low interest rate environment, which has now become necessary to avoid bad problems,” Malone said. “It is hard for me to believe that this will not be followed after a period of currency devaluation.”

Malone believes that the sheer volume of incentives will reduce the value of the currency, making hard assets more attractive. Real estate refers to tangible property including real estate and commodities. The DXY US Dollar Currency Index has fallen more than 10% to a March high.

“I’m trying to invest or diversify into difficult assets,” Malone said. “You know, I think the things I bought last year, I’ve bought … enough interest … Abundant housing, mainly in the US”

Record low mortgage rates are boosting demand for home purchases. Sales of newly built homes reached a 14-year high in August amid a home culture of living with a coronavirus epidemic.

Malone said that he too is getting into property like farming.

He said, “I bought irrigated fields because the commodities were cheap and the farm was on a low cycle in value. And I always wanted to do some irrigated farming, so now I’m growing potatoes.”

Subscribe to CNBC PRO For special insights and analysis, and live business day programming from around the world.

Related Posts