The legendary investor who managed to predict the crises of the Puntocom bubble or the recent great recession (2008),
Howard Marksco -president of Oaktree Capital Management, and Financial Guru that managed to predict the crisis of the Puntocom bubble and the great recession of 2008, said that “This is the greatest structural turn since World War II.” On the possible consequences in the future, the specialist warned that, beyond a possible rise in inflation, The highest risk of the commercial war is that the dollar loses its status as a global reserve currency.
The important investor before making these predictions warned that, for a period of 25 years, the cost of lasting goods in the United States was reduced by 40% in real terms, which helped maintain inflation under control and allowed access to products at low prices for the entire population.
“That maintained inflation under control. It made the goods available at a low price for all Americans. If we do not have world trade, we do not have that benefit. Tariffs are designed to encourage national production. Who could imagine that most of the products produced in the United States would be as cheap as those that come from abroad? In other words, they would cost more, “he continued his analysis.
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For this expert, World well -being is maximized when each country does what makes it better and cheaperand then sell it to the countries that need it, who do other things and sell them to other people.
“This is how trade works. The good news is that the Italians make the pasta and the Swiss the clocks. PEro if we stop world trade and Swiss have to make their own pasta and the Italians their own watches, the world probably – well, perhaps it could be said that the people of both countries – will be a little worse. That’s what we are talking about, “he added.
Although Marks did not say it explicitly, Losing reserve currency status would imply that the United States would have serious difficulties in facing its debt. Currently, the demand for treasure bonds globally allows the US government to take debt at relatively low rates.
Source: Ambito
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