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State Investment Officer: Stocks Headed for 40% Correction--Thanks, Trump Tax Cuts! [View all]
South Dakota’s veteran investment officer Matt Clark usually brings good news. But at Thursday’s meeting of the South Dakota Retirement System Trustees, he said the state’s pension investments are flat so far this fiscal year:
State investment officer Matt Clark said the SDRS portfolio through the first five months of this fiscal year has earned “roughly around zero. So there is no return.”
Clark said stocks that SDRS owns out-performed last year and are running behind this year. Only about half of the SDRS portfolio currently is in equity investments. Asked to look ahead, he said, “Unfortunately, we can’t be optimistic at this time” [Bob Mercer, “As Investment Chief Sees Storm Clouds Ahead, SDRS Trustees OK a Record Cost-of-Living Hike,” KELO-TV, 2021.12.02].
Clark said stocks that SDRS owns out-performed last year and are running behind this year. Only about half of the SDRS portfolio currently is in equity investments. Asked to look ahead, he said, “Unfortunately, we can’t be optimistic at this time” [Bob Mercer, “As Investment Chief Sees Storm Clouds Ahead, SDRS Trustees OK a Record Cost-of-Living Hike,” KELO-TV, 2021.12.02].
Clark predicts the situation won’t improve in the near-term as the market must correct itself from over-valuation driven by the Trump tax cuts:
By his calculation, the U.S. stock market is at 166% of fair value and he expects the market will be hit at some point by a 40% loss. “The markets never stay overvalued forever.”
Clark said federal tax cuts helped keep Wall Street prices inflated, and now that Congress is spreading trillions in COVID-19 and infrastructure relief, inflation has reached Main Street and Walmart too [Mercer, 2021.12.02].
Clark said federal tax cuts helped keep Wall Street prices inflated, and now that Congress is spreading trillions in COVID-19 and infrastructure relief, inflation has reached Main Street and Walmart too [Mercer, 2021.12.02].
Read more:
https://dakotafreepress.com/2021/12/04/state-investment-officer-stocks-headed-for-40-correction-thanks-trump-tax-cuts/
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