Clarium Capital's Peter Thiel told Reuters that he's preparing for deflation in an interview recently.
The video is below.
Here's what he's thinking:
- The proper view right now is deflationary, we're not headed towards a runaway inflationary situation.
- The consensus seems to be on the inflationary side. People are nervous about the government printing money. But that's not right.
- The economy is going to have a slow recovery for a number of years.
- There might be a double dip recession.
Investment tips:
- Don't go long equities
- Government bonds are probaly fine
- The dollar is probably fine
- Avoid gold
He says to look 40 miles outside of major cities (SF, NYC), and remember that you're still in the housing bust. "There are lots of problems."
Then he waxed nostalgic for the good ol' days.
If the whole US was like Silicon Valley, we'd be in good shape. But now, the entire US is not driven by technology, is not driven by innovation.
The model of the US economy is that we are the country that does new things. But over the past few decades, that's changed. Now we have people that do crazy things, like weigh 600 pounds. We have to get back to being the country where people do things that are new.
We're headed towards government austerity in a lot of countries, we're not going to eep on piling on debt, but growth is going to be slow.
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