Photo: Dealbook screenshot
Stocks surged yesterday after Ben Bernanke announced that the Federal Reserve would assign unemployment rate and inflation rate thresholds to guide monetary policy.But as Bernanke gave his post-announcement press conference, the rally evaporated, and stocks basically ended flat for the day.
Some pundits were quick to blame the chairman for the sell-off.
Not so fast, says UBS’s Art Cashin.
It just so happened that at the same time Bernanke spoke, hedge fund heavyweight Ray Dalio was preaching gloom at the New York Times Dealbook conference. Cashin says traders think Dalio should share the blame. From this morning’s Cashin’s Comments:
The Other Guy – Some traders felt that Mr. Bernanke should not be blamed/credited with all of the equity pullback. They point to some particularly downbeat comments from hedge fund icon, Ray Dalio.
Speaking at a New York conference, Dalio said that most financial assets were already “fully priced” and many are overvalued.
The next good play may be shorting bonds as rates may rise in late 2013 (what about the Fed and its new targeting?).
When pressed whether there is any asset he might still invest in, he thought there might still be some room in agricultural property in Australia. Not a very broad selection. Some felt the Dalio comments contributed to the afternoon evaporation.
Business Insider’s Joe Weisenthal was at the conference covering Dalio, who presented a rare set of circumstances that would be bad for markets. Click here for his notes.