Tags: Crispin Odey | Investors | Economy | Hedge Fund

Crispin Odey Sees 'String of Threats' to Global Economy

Crispin Odey Sees 'String of Threats' to Global Economy
Crispin Odey (AP)

By    |   Thursday, 07 January 2016 08:39 AM


U.K. hedge fund heavyweight Crispin Odey warns that investors could face a difficult year ahead amid a “string of threats” to the global economy.

The founder of Odey Asset Management predicts a possible devaluation of China’s currency and a potential property market bubble in the U.K. as well as concerns over the U.S. economy

He made the warning after profits at the hedge fund which bears his name fell by more than half last year. “Profits are tumbling, not rising, in most countries. Our firm cannot be immune,” he said.

Odey told the U.K. Telegraph that 2015 “was more difficult. China’s problems were starting to be felt globally but Europe was on the mend without being essentially healthy, and the US was strong but expensive.”

The fund manager, known for successfully short-selling banking shares in the financial crisis, added that tougher conditions were likely to persist in the current financial year and through 2016 amid a string of threats, the Telegraph explained.

“2015 ended with quite a lot of excitement still to be had," he said.  "Will the U.S. get rising interest rates and rising wages, the hoped-for environment for falling real interest rates? Will China find a way of escaping this slowdown or recession in construction and capital expenditure without being forced by high wage increases to seriously devalue the renminbi?" he asked. "And has Europe, including the UK, only rediscovered the housing bubble route to economic growth that got them into trouble in 2007 and 2008?"

To be sure, Odey isn't alone in his dire predictions.

American financier George Soros warned Thursday that weaker world markets, triggered by a slowdown in China, were showing signs of a financial crisis reminiscent of the 2008 crash.

Speaking at an investment forum in Sri Lanka, the magnate and philanthropist said China's flagging economy and subsequent devaluation of its currency were undermining global financial stability.

"We are facing a very serious transitional problem which is quite recent and it is, I would say, (something) that amounts to a crisis and we are at the beginning of that," Soros said.

"When I look at the financial markets, there I see a serious challenge, which reminds me of actually the crisis we had in 2008."

(Newsmax wire services contributed to this report).

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U.K. hedge fund heavyweight Crispin Odey, founder of Odey Asset Management, warns that investors could face a difficult year ahead.
Crispin Odey, Investors, Economy, Hedge Fund
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2016-39-07
Thursday, 07 January 2016 08:39 AM
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