Following are excerpts from the unofficial transcript of a CNBC interview with Tudor Investment Founder and CIO and Robin Hood Foundation Founder Paul Tudor Jones on CNBC’s “Squawk Box” (M-F, 6AM-9AM ET) today, Tuesday, October 22.
Legendary investor Paul Tudor Jones: I am clearly not going to own any fixed income
Tudor Jones On Being Skeptical Of Elections
Certainly the markets are saying he’s going to win. I think they’re heavily skewed by Republicans, so I don’t know if I necessarily believe the betting markets. But I don’t have any great insights. I really don’t. I would be more skeptical of them than I would normally. It is the same way – look in football betting, you can get a huge home bias where the line doesn’t reflect reality.
Tudor Jones On Tax Cuts
I think under Trump the deficit goes up by 500 billion per year. Under Harris’ plan, it goes up an additional 600 billion plan per year. I have a feeling all of those are just pipe dreams. I think the chances of any of those being enacted –
ANDREW ROSS SORKIN: You mean that the tax cuts that they are putting on the table during the campaign?
TUDOR JONES: Those have zero change of being enacted in my mind. I think the markets unequivocally – the debt markets for sure. The Treasury market won’t tolerate it.
Tudor Jones On Having A Minsky Moment
Will we have a Minsky moment here in the United States and U.S. debt markets – will we have a Minsky moment where all of a sudden, there’s a point of recognition that what’s going to happen or what they’re talking about is actually fiscally impossible, financially impossible.
Tudor Jones On Fixed Income
I am clearly not going to own any fixed income and I’m going to be short the back end of fixed income because it’s just completely the wrong price.
Tudor Jones On The Next Administration
You’re going to have to have the smartest and the most sensitive President, Treasury Secretary, that Treasury Secretary damn well better be from Wall Street and know markets. It cannot be a corporate who does not understand the plumbing of the financial system.
ANDREW ROSS SORKIN: Who do you think is going to get you that Treasury Secretary?
TUDOR JONES: I don’t know. And frankly, let me say one last thing, our Fed Chairperson, our Fed Chairman and the next Chairperson after that, the three of them have to be brilliantly connected to be able to stick this landing. Because again if I look at debt to GDP, the path we’re on, it’s rising faster than the ocean.
Tudor Jones On Deficit Spending
You can also say one of the reasons the U.S. is so dominant is because we fast forwarded so much future income by spending so much in a deficit standpoint and it’s really occurred, to be frank with you, the guy that started it was Trump. He inherited a 3% budget deficit in 2016. In 2019, it was close to 5% pre-Covid, before Covid then of course, Biden gets in and sees what Trump has done and says let me raise you one with the inflation reactivation act and here we are today.
Tudor Jones On Expire Tax Cuts
You have to let those expire, that’s $390 billion. We’re going to have, again, we’re going to be broke really quickly unless we get serious about dealing with our spending issues.
Tudor Jones On Roads To Inflation
Every 100 basis points, given where our debt to GDP is right now, every 100 basis points is worth about $90 billion a year to the deficit. $90 billion. So yes, if we’re trying to stabilize debt to GDP, we want to run the most dovish monetary policy that we can without letting inflation become too much of a tax on the citizenry. So yes, all roads lead to inflation. That’s historically the way every civilization has gotten out, they have inflated away their debts.